Transcripts For CNBC Squawk On The Street 20240622

Than annihilated overnight. U. S. Futures surging after Chinas Central Bank announced they are going to a similar jump in futures after china announced a rate cut but that 441 point rally in the midday session was wiped out by the end. The blue chips closing down 205. The s p has lost 2 trillion in market cap over the past seven sessions. You did not like yesterdays open. Do you like this one in. I think there will be a better time if you want to buy. I think there have been some bargains created. Thats a big difference. I think yesterday is funny. We should have been down one . Yesterday europe was pushing the euro down. Interest rates werent that good. Interest rates not that good. We have a couple things i like. Schlumberger is the greatest in the oil patch. Theyre making an acquisition. Weve been waiting for consolidation there. The actual individual components of retail that have been strong. I think the last 45 minutes were a access of buyers. My only problem is why isnt there a total absence of buyers again today. China is selling treasuries aggressively. Why do you think that . They sold 100 billion in two weeks. And i think they still probably have about 1. 2 trillion. This money is coming from somewhere. Is that part of supporting the currency now . Theyre supporting, theyre injecting currency, money, i think to help the banking system. Thats positive, but at the same time we have a lot of fed heads talking. Now, we have dudley whos a smart man. I worked with him at goldman sac sachs. He is not a man known to be able to say i want to throw some fire, some settling on the fire. That could be calming. I think some people are reading dudley as saying were looking at everything. Dudley is one of the guys who looks at everything like j pal. The last fed guy controls, dudley is not a person who has come out and historically had no common sense in stocks. I think this is a better run than yesterday. But the euro is still wrong, and Interest Rates are not right, so when youre buying it up today youre saying that yesterday cant happen again because we had a successful retest. I think you get a better moment. Its better than yesterday. Because of the china being a serious country and because of the takeover bid but its still not great. Leaseman has made his way to jackson hole. We know you are net dovish. You dont want a hike. I want them to say we dont need a hike right now because theres a lot of world turmoil, but understand that we believe that things are uncertain. But when they get certain, we are going to act. Thats kind of what i want. But theyre never certain, and, in fact, there were so many times they could have acted and didnt that many people will look at lost opportunities now to have given us 25 basis points in join when the world looked better than it did now. We have paid for a hike in all of this volatility. Dont chicken out now. One of the things thats happened is were building in a hike. When we build in hike, whats happened is we go back to a 2011 play book. Its the one ive been using. We have italy and spain. I think thats a good analogy. Port gull about to fail in terms of their sovereign debt. You drop 17 . Were almost there. Roughly the fall of 11. Were almost there. If you havent bought anything, you have to buy something. I prefer to buy it some point intraday where the futures arent totally in control. The dow theorists are out today with the transports down 19. 8 from the all time high. So if the transports were to go into bear market today a lot of people are using technical. Bull bear comes out 31 bull down from 37. Thats the most negative its been in a fiveyear low. The oscillator i use is almost minus 8 other than the 2008, 2009 period when you had to cover shorts and buys. People think there was a successful retest because we held at the intraday low for monday. These things get people excited. I think you should be buying high quality stocks and pay good dividends on the way down. I dont like up 400. Its silly. The market is not working right. I wonder if theres been a bit of erosion in the confidence in the market. We talked about it monday after the flash crash, but also a number of stories this morning and goldman out with a note about etfs and the pain they took as they composed and recomposed themselves and how that occurs, and how important they are overall to this market. Perhaps we dont talk about them but they are the market in many ways. I know, and these machines cant function. The one thing i can argue is companys corporate treasurers should recognize the big and balance. Its not like when you have a sell off like yesterday its not like people come in and are a little more ready. Thats why i say okay, look. Maybe you wanted to be in at 245 when the selloff was about to start. You come in at the opening, and theres some stocks that are down so much that the opening may not affect them, but recognize the futures are in the opening and it doesnt matter whats happening with the individual stocks. If you want to own a stock, you can wait a little bit. A great chance yesterday. We know youve been looking at domestic stocks, stocks that are thats what i like. Now people are asking, all right. What if the severity of the decline in stocks starts to have an affect on Consumer Sentiment and spending and then those domestic stocks are affected . Thats why i wanted them to hold off on the rate hike. When you start questionigettings about consumer confident on a good best buy Conference Call because of the stock market, they say listen, so far not so bad but you have Consumer Confidence in oil in texas, it wasnt so bad for toll. The toll quarter wasnt as bad as people think. Toll was okay. Best buy was great. Abercrombie was good. The actual data so far does not support that. And an s p is down 6. 6 for the last 12 months is going to impact Consumer Confidence . Theres volatility recently. If youre look at volatility, it says im not going to buy up 300 for the dow, but you know what . Is the market is at one point down a lot or from that high, not down but down a lot from that high, take a look. Take a look. Remember, yesterday was jarring to the confidence, and, yet, the buyers came back. Theres somebody out there who continues to own. I just want to wait a little bit because at the end of the day, at 330 when the buybacks stop and the etfs went nuts, there was no one there. So if you want to buy, wait until midday and then come back at the end of the day. Do you have a problem with the notion that bear markets are character rised by very sharp rallies that dont live . Just what david and i were talking about before the show started. This is really unhealthy. You come in, whatever you bought yesterday at 330 if youre a trader, youre going to flip it at the opening. Look at these. Apple is a big cap stock. Can we agree on that . That stock is trading in increments that are, frankly, insane. The company is doing well in china. We got that from tim cook on sunday night. Sunday night into monday morning. And we know schlumberger is in the hardest hit area, decided they would not be buying cameron if they felt things werent about to get better. That was significant. I always look to them to know more than everybody else. Thats a really data point. It is. Its interesting. Oil has been where were worried. Yesterday we had bhp on. China came out saying we see a slow down. He said by the indicators shes followed, he believes its the number in terms of the growth of the chinese economy. You and i both were surprised by that. But that is what he said. So he was he seems like a nice man. Nice man. How do you know, though . Schlumberger knows with the future holds but bhp does not . I think schlumberger realizes there might be a moment where cameron has a lower nurmt. I think they think others arent going to be able to merge. That deal is facing a great deal of opposition as a result of the divestitures themselves and how are you going to create . Are you going to find somebody to buy to create a competitor. Slummchlumberger is baker us well get to more after the break but this deal does not have overlaps so doesnt have the antitrust concerns. Back to the market. Im calling people and looking at the dislocations, are we going to see any funds blow up . Im not hearing much of that and not hearing really any impact on fixed income. If youre trying to trade bonds, theres not much going on, that is true, but in terms of plumbing of the financial system, everything seems to be fine. Spreads have widened. Energy is a complete disaster. Beyond that, not much, and i think when you want to look further beyond what the impact is of this volatility, you look there. Youre not going to find anything similar to what we saw, of course, seven years ago. Thats why i dont like, again, a lot of 2008 analogies. Tick kavasa, he said, dick, i dont mean to put words in your mouth, but the fed rate hike, as you go down, it says were having a fed rate hike and its less of an impact. He said something that was smart that made me rethink. He said we could go up on a fed rate hike at this point. Were down so much, to use a 2009 analogy, at one point were 4 off how much we went down and that was after the 2011 debt crisis. That is a second worse Case Scenario and were pretty close. When we come back, goldmans head of commodities on whats next for oil and where china fits into the mix. Take a look at the premarket. Rule 48 invoked again at the nyse for a Third Straight head. Were back in a minute. A lot of cross currents today. Looking at a shanghai that was down only 1. 3. Dudley speaks in about 45 minutes. Well get to that throughout the course of the hour. We have a large deal in the Energy Sector. Slumb slumber jay buying come ran international. The deal valuing cameron at the open at 66. 36 a share. That is a 56 premium. Although not its 52week high. 600 million in the second year after the deal closes. Jim, you were talking about it earlier. I can tell you the fact that they were even able to pull this off during the week of volatility that we saw while leading up to the announcement this week and last week, they originally, i think anticipated they might have a monday announcement. You can imagine why they werent able to get it down. And then in the face of oil prices and whats been doing on there. In some ways cameron can view it as a derisking trade. 80 of the consideration is in stocks. Youre still going to have an opportunity to participate in the potential benefits of the combination if youre a cameron shareholder. 20 is being paid to you by slumber jay in cash. While theyre busy trying to getting approvals. Slumb slumber shea, they got this thing done quickly. It got done in a week. Lets keep an eye on their shares. As we know, in this robust market for the m a, the kwie acquirers stock prices oftentimes go up. Others see that and say i want to do a deal too. I was shocked by this. You said last night not youre sufficient in some others like conoco. Raymond james put out a thing saying things are okay. Slumber jays stock is down from a super cycle note. Remember the fracking stance . The stocks, theyre giving away their stock at an inexpensive price. What i like is that this says drilling is going to continue and we have to be competitive against others. Thats halliburton. Halliburton is doing this frack now pay later stuff. Theyre giving you easy terms to keep drilling. Schlumberger is the industrys First Complete drilling and Production Systems integrates implement ri surface offerings through software optimi optimizing. They take care of most of it for me. I buy the land theyre brilliant. This deal is so good for them. When they heard baker and halliburton getting together i was like that could be more competitive than schlumberger. Theres obviously some sense they know more about the oil market than anybody besides the sa saud saudis. The saudis are the reason were doing. Would it shock me for them to pump less . Theyre already having to watch their budgets. Theyve been doing Public Offerings of debt. Schlumberger looking at the long term. Theyre not playing for tomorrow or the next day. Theyre playing for years to come. Theyre the smartest guys i deal with. They built a fabulous company. Look, they know more than we do is what im saying. When we come back, well get cramers mad dash and count down to the opening bell. One more look at futures. Well see how the opening bell goes. Looks to pop open to the up side. Can a business have a mind . A subconscious. A knack for predicting the future. Reflexes faster than the speed of thought. Can a business have a spirit . Can a business have a soul . Can a business be. Alive . Two trains leave st. Louis for albuquerque at the same time. Same cargo, same size, same power. Which one arrives first . Hint its not the one on the left. The speedy guy on the right is part of an intelligent system that creates the optimal trip profile for all trains on the line. And the one on the left . Uh, looks like itll be counting cows for awhile. So maybe the same things arent quite the same. Ge software. Get connected. Get insights. Get optimized. To folks out there whose diabetic nerve pain. Shoots and burns its way into your day, i hear you. To everyone with this pain that makes ordinary tasks extraordinarily painful, i hear you. Make sure your doctor hears you too i hear you because i was there when my dad suffered with diabetic nerve pain. If you have diabetes and burning, shooting pain in your feet or hands, dont suffer in silence step on up and ask your doctor about diabetic nerve pain. Tell em cedric sent you. Well get started with trading in about seven minute. Looks like a positive open, the s p up perhaps as much as 49 points. Looks can be deceiving as we know. Stay tuned. Match the last 20 minutes of trading as well. Lets get to the mad dash. An upgrade of google. I like this kind of upgrade. Discipline created the alphabet with the Venture Capital arm. The stock ran up. Those who recommended at the top, didnt help. Yesterday the stock was up and reversed and finished down five. Now, in a perfectly timed upgrade at Goldman Sachs goes from hold to conviction buy because they waited the whole way down. Thats my kind of analyst. Coming in at the low. This is about mobile sales strong talks, mashrgin boosts. Heather bellini has this right. She waited and pulled the tr trigger. Congratulations to someone who didnt get caught up and waited for the right moment. The stock down yesterday in whats known as an island reversal. The technicians said it was done and Heather Bellini comes. Heather is going to join us later on today. This is cool. She mentions in june titled dear ruth, welcome to google. Heather is the ax in google and shes not a selfpromoter so im promoting her. Someone has to do it. Well watch that closely. Its a high profile upgrade on a week with a lot of upgrades. A gutsy time. People went home on google and said were dead. Bellini said im alive. Finally, i guess my chance. Good analyst. The opening bell on this wednesday just minutes away. When you get up to 50 off hotels with travelocity, it means you can also afford to get up to 50 swedisher swedish massages. Making it the place to find a place for labor day. Go and smell the roses . Of fixodent plus adhesives. They help your denture hold strong more like natural teeth. And you can eat even tough food. Fixodent. Strong more like natural teeth. Fixodent and forget it. Youre watching squawk on the street live from the Financial Capital of the world. The opening bell in 2. 5 minute. Just as a refresher, the s p is down six straight days. The dow with it worst monthly performance since 2009, and on a point basis were down 2,023 points in august. Weve never had a month where the dow has fallen 2,000 points. September is historically down. And that makes people want to get out ahead of the 1 . I keep coming back to the analog. If its as bad as it was in 2011, i dont think it is. Youre within 5 of the bottom. I dont know. If you havent bought anything, youre probably making a mistake. Yesterdays closing was so bad that you really had that wow. The number of new lows yesterday was straggering. I dont expect a quick bounce back. Verizon, 5. 4. Im getting. 2. Ge was turned and was down. Some of the names in that late turn, but fwrarankly, ge was nop a great deal anyway. The yield is almost 4 , not quite. This is not bad. Thats not bad to see some of these you were great. Why, with a tenyear at 2. 13, what would stop you from buying verizon . Fear. Fear, plain fear. They were not facing the problems that at t was. . No, 5. 4. I dont know about you. You dont cut your bill. It never goes down. 172 thats what it was. Per month. Yeah . Is that a family plan . Wow. Im looking at some of the other yields. This was put together last night after the bill. You mentioned verizon was above 5. I wrote them down. Itll come to me. Mcdonalds near 3. 5. These are truth. Ge 3. 95. Exxon 14. 5. Exxon, i thats interesting. Those are interesting to me. Apple, i dont know. Theres the bell and a look at the s p. At the bottom of your screen. The United States Tennis Association at the big board and players marty fish celebrating the u. S. Open. It begins monday. At the nasdaq, yahoo mobile. Yahoo. Some of the internet napes held up at the close. Theres a lot of camps putting money to work. One of the camps is the worldwide recession. They want to own netflix and amazon and facebook. Those companies are still levered to their own internal growth, accelerated revenue growth. Theres a lot of people who say those are the big joke stocks at this point. They have not proven to be jokes. Their earnings are good. Netflix in the case of no china. Google in the chase of no china, and amazon, saying amazon numbers are good. Nike, taking it to a positive. Marathon. Marathon is such a buy, because, obviously, the price of oil, theyre buying oil at probably 30 in some cases. They have a midwest refinery, and youre still paying pretty high thats a winner. Jpmorgan takes this to overweight, 61 target. That was a good call. Are you still thinking that 30, though . I think that we have the inventories, the inventoryings. The work i do, and a lot of it is augmented by rbm. Its the finest oil analysis. Theyre saying were not going to go back to where we were. Theres too much production. You need to know, are the saudis this yemen war, its extremely expensive. Will the saudis have to say we need Prices Higher because as much as we hate the fact that the u. S. Is talking to iran, the yemen war is costing us a fortune. Egypt got its butt kicked when it went up against yemen. Its fair to say its a mess over there in a lot of different ways but yes. They have to spend a fortune on armament. And they have a fairly large welfare state within the country to try to support. Thats why its interesting that they tapped the bond markets this year in a way they hadnt in many years. All they have to do is take their foot off the pedal and they have more money. At what point do they say weve broken the u. S. , with schlumberger and cameron, its not going to stop them. Production is flat in the u. S. Maybe the saudis dont win and maybe thats the only thing that can make the oil situation. Oil has to stabilize theres so many defaults that are going to happen. Id like to pick up on that. I think youre right. And what i am hearing is were getting closer now to where youre going to start to see defaults in the Energy Sector and even bankruptcies of Public Companies because the hedges, the hedges that have been on at many of these oil companies, the smaller ones in particular that are protecting them to a certain extent or at least masking the underlying weakness in their cash flows are going to come off. Theyre going to roll off. And then youre going to be fully exposed, and suddenly the banks that are lending to you because, in fact, if you follow me, because of the hedges youre not actually suffering as much financially. Suddenly you will be, and those banks are in a much better position. Theyre not going to close their eyes to you not making your Interest Payments the way they might have a few years ago because theyre like i dont want to hear it. Instead theyre going to come in and say see you later. Lets get this done and restructure. Thats coming. The carnage thats taken place is astonishing. You get a chance for a lift here. Have you taken a look at chesapeake. I think its a sale. Chk over the last year. I mean, this was a 30 billion company. Its now 4. Well, its not a huge amount of debt. Oil company, we know its natural gas because we remember the days. Theyre all oil now. There it is. Thank you. I think the exxon dividend is absolutely safe. My travel trust owns stock ox sen tall. And pretty much everybody else has to stop pumping, cut cap ex, or sell. But theyll do that. A lot of the Companies Want to preserve the dividend. You get the lift in some of the ancillary companies and i dont want to own them. Just like yesterday at this time, two stocks in the s p are in the red. Everything else in the green. And its interesting. You look at a merck today, close to the top. The first dow component to go red in the middle of yesterdays session. What was that . Why merck . I spent a lot of time on merck last night. There was nothing. There was nothing at merck that happened. There was no fundamental reason they turned . No. I know that group well. All these groups are lock step in the futures. This is exactly thats where i say, you know, look, if you have something that shouldnt be up or you know is doing badly, sell it now, buy it back later if you want to be a trader but you have to put money to work when its down, not up. Does the fact that yesterdays rally failed make you like todays wbetter or worse. The technician in me says we held the panic low. The panic low. Yes. It was incredible how we held it. I got the dollar very strong again. I dont like that. Interest rates arent that good. Youd better have a good case about why you want to buy something. Goldman, this is a regional call, but they maintained their regional overweight on china. They think a lot of the concerns have been priced in. They say buy names that are levered to structural reform and fiscal tim yu fiscal stimulus. Does that make you nervous . I think it could go down 1,000 points. That would be back to where it was this week last year. I think it has to repeal the whole move. I think its a nasdaq 2000. I did a lot with the companies that are in the index. They sell at more than 100 times earnings. What does that remind you of . Those are the sock pickup trucks to yo puppets to you. When you look at the companies individually, its off p putting. Theyre so expensive. Chinese equities. Yes. Mentioning those, by the way, alibaba shares rup a bit this morning. But they passed through and below the ipo place. The technicians love a stock that has fallen 50 . They love that. Alibaba was in the 120s last, when i was there on singles day, november 11th, 2014. Let me know when you go to china next. Again, i just want to say, dow up 300. Stra transports up. This is terrific, but its a long day. It is great. What happens if they dont hold at the end of the day. What do you hang your hat on tomorrow . Maybe it is that china is ejecting a lot of money. I think the shenzhen is way too high. Remember yesterday europe held. Why . The euro went down big. We were up 3 at the opening. Why . Because the euro went down . We need a weaker dollar. Now the stronger euro, did you see lvmh, weak china yarks stronger euro. Theyre getting clobbered. Ill be in florence, and i am going to buy everything they have for sale, and ill bring you back ties that will blow your minds. You are always generous. When is that taking place in soon . Yes. Its called my honeymoon. Ive delayed it twice. The market has to go down. Just take your honeymoon. Take it and enjoy it. My first week off this week, full week. All this tumult, we havent talked about twitter in days. Theres plenty of agonizing amongst shareholders. It was down all day yesterday. I figured its been a while. We have to mention it. 25. Also right below the ipo price. Im forgetting where it went public, but it was 26. So youre suggesting nothing. Just mentioning it. Just mentioning it . Theyre still looking for a ceo, as we know. This may be a good nice. Why . Abercrombie has no ceo and look at the numbers without a ceo. Unbelievable. Can you imagine . Maybe the trick is to not have a ceo. That was an unbelievable quarter for them. Every single month was up. There is no ceo. It was amazing to see that kind of performance without a ceo. Who knows how they could do with a ceo. It could help them. They do have an interim ceo right now. Be fair. I dont know. Thats a very troubled situation. Rather astute fellow. Jcpenny had a good quarter. Express beat. Thats a blue moon. Macys. When are we going to get back to macys . When are we going to start hearing that people are unhappy with the stock at 57 . Aboctivists have been shellacked in this market. I thought you said pacifist. No. Not quite as large as we listed it at because some of its inexpensive stock there. Im going to say what youre not supposed to. Some of those stocks went from expensive to inexpensive. The dow is inexpensive but people think earnings arent going to be there. Most of the stock estimates are not going to be cut in the dow. The thing i dont get, jim, i dont get we have this big selloff, and you have the tenyear yield rising. Why where is the race, the rush . I think thats the chinese selling. I think theyre just, lets raise some capital. Lets redistribute capital. My head writer, cliff, says they have a lot of helicopters. Theyre real. Theyre not propping up that junk. They have a lot of stuff to pay for. The names of some of the companies and then you go look at them and theyre 100 times earnings. They bought a huge stake in a penny stock. Theres a Hydropower Company and the Chinese Company came in and bought a ton of it. Thats like, wobistics, the one that tony soprano. I looked at that company and said this has all the same fundamentl talls. Before we get to bob, if i can mention the mlps. A lot of our viewers own them, i think, and they have been a place to go to get great yield. Now its turned around. My travel trust is buying one right now. Really ugly, jim. Pulling the trigger. What is it . Energy transfer partners. You are buying pte. Etp. Its an inquisitive company. But the need for natural gas pile right now is extraordinary. Everybody has to have pipe to louisiana in texas because were going to be exporting. This is not oil. We cant export oil. Etp is levered to the natural gas export. Look at that. If you look at a twoyear, thats an ugly chart. One mans trash is whatever. This is a stock that just reported a good in your opinion. This is not a plains. This is a wellrun company. Is it going to go down more . Then its at 10 . My trust will buy more. The trust needs some income. All the dow components are in the green, but of course a very sharp decline from the intraday high already. Bob is on the floor. I was just talking to one of the guys here. Five to one advancing. Gap up 40 points in the s p n. Its yesterday. It looks like yesterday. Lets hope we dont have the close of yesterday. Overnight we were strong. We were strong going into the european open. We were up 10 points in the s p futures. And we moved in and it got stronger as we went into the european open. We moved up after 8 30 when durable goods number came out. Love the durable goods number. It supports the idea that solid durable goods, the chinese economic linking to the u. S. Is less than expected. I think we should emphasize that point. That was an important number. Germany, gap down at the open. It quickly rallied and was in slightly negative territory. There it is. Most of europe is fractionally to the up side. Its either side of positive or negative. Let me put up where were at right now and this is a little bit simplified. Its important to remember that a lot of stock has been sold in the last five days. And an awful lot of protection has been bought. You dont need to be overwhelmed with the numbers but theyre enormous. And sentiment indicators, all the numbers are off the chart. I struggle how describe how crazy the numbers are. I asked how far the s p is from the s p 50day moving average. Its a got indicator of where were not. Were 4. 5 standard deviations. Its so rare. Its never happened except once. Since 1980, it happened in 2011 when the s p cut the rating of the u. S. And one week later we were im 7. 5 on the s p. The russell 2,000 was 10. 4 . And energy and materials were higher in the week after that. Well have a trader talk out on that. But this only happened once in the last 30 years. Take a look at the dow leaders and the tech leaders. Google up, amazon up, netflix up, facebook, and apple. Speaking of dow leaders. Look at the dow. You can see merck in the pharmaceutical area. Verizon in the Consumer Services area. Jpmorgan in the banks. Home depot in the Home Improvement area and even oil. Its an across the board rally were seeing. Chevron and the oil group, jim was telling you about the tell with schlumberger and cameron. Thats an interesting deal. Were talking about roughly 12 billion in cash and stock for them, for cameron. What happened with transocean, theyre seeking to cancel the third and fourth installments of their dividend. They pay a dividend of 4. 9 , theyre talking about cancelling that. The chevrons said theyre going to keep their dividend but the oil drillers and services have not made any pledges and youre seeing some of them backtrack on that. Were holding up on the gains. Thank you, bob. We will keep our eye on that tenyear. Lets get to rick at the cme. Hi, rick. The tenyear and the 30 year, ill start out with what i think is the most important chart youll see on my hits today. This is a oneweek chart of the s p futures. I picked them because from a time perspective it trades more often and makes these charts look better for the off hours. Youll notice that we definitely did not correlate. We were very indirectly correlated about twothirds of the way through that chart. The 30year has been stubborn. Actually the whole treasury complex has been stubborn, and i think theres a way to market whisper. As i look at this, this isnt me talking. As i read the markets, i think theres a potential temporary all clear for stocks. Why . I think the only hedge that really works historically for the stock market are treasuries. They havent cooperated but theyve led the way on most of the big dynamics of the economy. Look at a twoday of tens. Popped above when we traded yesterdays high. Love the twoday charts. Open up march. You can see where it stopped and made sense. The 30year is even more stubborn and five to 30s is nothing but steepening hovering around the 139 level. If we look at foreign exchange, remember, simon hobbs nailed this a couple of days ago. Excellent job, simon. The carried trades, its carry cover. Whether its the euro or the yen, but the euro in particular, all of a sudden, its lost a lot of handles in the last couple of sessions. Year to date chart, check it out. In the end, it might not be an all clear for forever but it might be an all clear for now. Thats the way the lineup is when you look at the trades most closely associated with nervousness in the market. Well come back to you in a while. Rick in chicago. When we come back, rbcs mark mahaney on why hes raising the price on netflix. Up almost 40 points on the s p. Back in a moment. 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We still have to get through dudley in about eight minutes. Oil inventories in a little bit more than a half hour. Well get to stop trading with yim jim in a moment. It took Serena Williams years to master the two handed backhand. But only one shot to master the chase mobile app. Technology designed for you. So you can easily master the way you bank. No students ever been the king of the campus on day one. But youre armed with a roomy new jansport backpack, a powerful new dell 2in1 laptop, and durable new stellar notebooks, so youre walking the halls with varsity level swagger. Thats what we call that new gear feeling. You left this on the bus. Get it at the place with the experts to get you the right gear. Office depot officemax. Gear up for school. Gear up for great. Time for cramer and stop trading. Dow is nicely down 100. I like that. Let it come in. Accidental high yielders. Eaton came in today at 4 . Ge yesterday at 4 . And i want to focus on procter. Look. I know procter is going to miss the quarter. Theyre not doing that well but they have a lot of levers and a good Balance Sheet. They can break the company up and the yield is 4 . Buy procter at 4 and put it away and they figure out what to do. Goes to 4. 5 , its a real company with real companies. It does a lot right. They charge too much for gillette. Thank you, schick for sending me a new razor. They did not. They did. Quintanilla is harder to spell than cramer, maybe. There it is. At 5 , procter is a bow wrapped up gift. Thats the way you need to look at it at home. I hope procter goes to five, because i can put it away. Whats on mad tonight . You want a temperature of the consumer . Its pvh. Manny chirico does a wonderful job. Once again, im not crazy about any market that opens up. Procter and general mills, as it goes down, you buy them. Dont buy them up. Nothing up is sustainable. Jim, well see you tonight. All right, guys. Its going to be another long one. Its so long. 3 30 is a long time from now. When we come back, bill dudley from the fed will be speaking and more on this mornings rally. Will it have staying power . The dow is up 316. trader vo i search. I research. I dig. And dig some more. Because, for me, the challenge of the search. Is almost as exciting as the thrill of the find. announcer at scottrade, we share your passion for trading. Thats why we rebuilt scottrade elite from the ground up including a proprietary momentum indicator that makes researching sectors and Industries Even easier. Because at scottrade, our passion is to power yours. More and more, data is visual. In fact, the number of mris has increased by ten percent a year. And a radiologist might view a thousand images to find one tiny abnormality in shape, contrast or movement. Because its so challenging, a Research Project is teaching ibm watson to see. In the future, it could help clinicians spot key patterns quickly and precisely. Ibm watson is working to make healthcare smarter every day. Can a a subconscious. Mind . A knack for predicting the future. Reflexes faster than the speed of thought. Can a business have a spirit . Can a business have a soul . Can a business be. Alive . Good wednesday morning. Welcome back to squawk on the street. Im Carl Quintanilla with sara eisen, simon hobbs, david faber at the new york stock exchange. It looks like a repeat of yesterday. The question is whether the similarities last into the close when we had the massive collapse on tuesday. For now the dow is up 310. All the components in the green. Watching oil and bonds closely as crude has dipped into the red. Lets get to the road map. While the market rallies, investors are looking for any clues about a possible Interest Rate hike. Well hear from bull dudlill dua moment. Only two sectors are positive. We will pick through the big names in consumer discretionary. And netflix going up from 125. Goldman sachs head of commodity will join us with his take on the big move in oil. Now, to new york fed president bill dudley speaking now. Investors are close cannily watchi watching everything they say. Joining us now, our senior economics reporter steve liesman. What can you tell us . Reporter simon, thanks very much. Bill dudley in the written remarks that hes reading right now makes comments only on the area in his district. He says it is doing well. He says there are pockets of weakness. He sites the fed coverage which has been on the decline and puerto rico as well. He points out new york city job strength saying its linked to tech, not wall street. Jobs in silicon alley. He makes no comments on the National Economy or policy in the written statements. Were awaiting a q and a and we expect questions to be made on monetary policy. We got some data today that highlights the puzzle for the fed. The u. S. Economy has been doing reasonably well amid the market turmoil, july durable goods beating estimates up 2 . Way better than the estimate. June revised up as well. Capital spending by business 2. 2 . This sets the scene for the u. S. Economy going into this downturn. We expect it to come off somewhat when we begin to get data from the downturn. But at least the table was set reasonably well going into this downturn. On the fed our cnbc fed survey shows that forecasters pushing later, pushing out into the future. The time for the first fed rate hike seen as december 2015. That is three months later than originally forecast in our july survey. You can see when they expect the feds Balance Sheet to decline also pushed ahead three months. The rate coming down, the final rate now seen at 2. 8 which would make it one of the shallowest rate hikes weve seen in a long time. Waiting for that speech by the q and a action with dudley coming up in a few minutes as well as the commentary were going to get from here and where the fed stands on the rate hike. Maybe interesting to hear whether dudley sees the recent market volatility lynned inked policy or emerging markets. Somebody wrote overnight if they came through with a rate hike now, it would be like putting a match to the fire. The market is so volatile at the moment. So much depends on what they do. Maybe a move in settlement. Maybe a move, people say now in october. Do they come forward . Do they feel the need to Say Something to the market . Can they Say Something to the market at this stage that would define where theyre going . I dont think so, simon. I think they said what theyre going to say. Theyre data dependent. You factor in some potential difficulties for the u. S. Economy from whats happening overseas. You factor in the concern for market instability. Someone wrote and said while markets in the current state, thats going to be the dominant factor for the fed right now. But if markets calm down, if we bounce back and if the data is good, three weeks from now, perhaps the fed may decide its okay to move but i like the idea of october perhaps as a possibility. Its still on the table, simon, until the u. S. Economy shows some effect of this market tumult but the big issue is inflation, and we know were going to get a deflationary impulse from the global overseas weakness and the commodity weakness and the strength of the dollar. Thanks, steve. In the meantime, all ten s p sectors are in the green. An early surge putting markets in the krterritory. Lets bring in the head of sales. We are going to take the q and a live when it begins. We think its in about 15 minutes. Does he speak for the board . Is he a bridge to what fischer might say on saturday . Well, he certainly is one of the most important members of the board. I dont think fisher, himself, knows yet what hes going to say on saturday in terms of nearterm policy. Remember, the title of fishers speech is about inflation. So the great bulk of the remarks is going to be about whats happening to commodities prices and whats happening with core inflation. Lets not forget. The feds focus is on core inflation unlike other central banks, theyre not focusing on the total Consumer Price inflation, but i think from fischer, youre going to hear more about inflation, and maybe a few hints about the fed, but i think theyre going to keep their options open. Its not clear to me what the markets want from the fed at this point. Do they want the fed to hold off until next year on an Interest Rate hike in does that cause a market rally or does the signal come from china . Frankly, i think they want them to move. Into the fed makes a decision to move, sayre arra, i think the m react positively. Talk about data dependency from a time line perspective, thats the next focus. I think the fed needs to make a decision and move in september. I think it would be a very bullish thing for the markets. I think traders, investors would take it in a positive light, and i think the market would continue to move, to higher levels. I think people are set up for it. I dont think thats a consensus view from that a fed rate hike in september is bullish fortunate markets. Higher Interest Rates is giving investors anxiety. No doubt. Were looking at 25 points or less move in rates. I think you have it all over the map now as far as what some of the bigger banks are looking for whether its settlement ptember october or december. I think the market has been so fixated on this move in rates. Were talking about a slight move. Were not a zero Interest Rate economy right now. Going to 25 basis points, three months earlier or not isnt necessarily going to change anything except an overhang. An overhang thats been on investors minds for a long time is when theyre going to act. Im telling you, once they act, youll see a reaction thats positive. In the meantime, a lot of people are bitterly bdisappointd that yesterday we were unable to maintain the gains on the market, and they eroded toward the end of trading. What color, from your perspective, can you give on this and the fact that we cant seem to bottom here. I think yesterday was interesting. The market held around at a certain level for most of the day, midday. I think what we saw was a tremendous amount of Short Covering early on. Some adding to long positions. Anybody that had a sell ticket on their desk was really waiting. They anticipated the market was going to move higher. I think what happened was the Retail Investor, there was soft redemptions. We saw 3 . 6 billion of redemptions on the close. I think when the Retail Investor decided to place orders around that 2 30 time frame, that was a massive imbalance. It dislocated the market. I said yesterday on the show, i believe that we saw the lows a couple days ago, and today were turning around. I dont think were going to have that imbalance to the sale side today. I think the Retail Investor sold yesterday and its basically finished. Durables today, the upward revisions, the beats, we had confidence yesterday. Obviously a lot of the employment measures. You say they emphasize genuine momentum in domestic activity. How bullish are you trying to sound. How bullish . Tomorrow theyre going to revise the gdp for the second quarter. I think it will be revised up to 3 , and given the way the durables reports look today, you could be running another 3 quarter this quarter. You were in the september camp predicting a rate hike. Have you changed your mind . We havent changed. We were saying its a toss up, that its 50 50. The fed fund futures are in the high 30s right now. A lot can happen between now and then. Well be sensitive to what happens to the employment numbers a week from this coming friday, and it looks like youre probably going to get another decline in the unemployment rate. Whats the effect of the market falls on the economy and if david is right that you have a Retail Investor thats selling as its selling. When economist look at the wealth effect on consumer spendi spendispen spendi spending, its only a few pennies on the dollar. Theres not an immediate change in Consumer Spending. I would not look for a major reaction to the consumer to whats happening with stocks right now. Theres a reaction, and some investors portfolios but theyre distinguished between that and the overall Consumer Confidences. Thanks so much for helping us kick off what will be a long and busy day. Well see you later on. Thank you. With the dow up 343, up next, consumer discretionary, one of the only two sectors thats barely holding onto positive gains for the year. Sort of on the unchanged lines. Well name opportunities that lie in retail when we come back. Hi my name is tom. Im raph. My name is anne. Im one of the real live attorneys you can talk to through legalzoom. Dont let unanswered legal questions hold you up, because were here, were here, and weve got your back. Legalzoom. Legal help is here. No sixth graders ever sat with but your jansport backpack is permission to park it wherever you please. Hey. Thats that new gear feeling. This week, these folders just one cent. Office depot officemax. Gear up for school. Gear up for great. It was one of the last s p sectors to turn red, consumer discretion just turning positive for the year. This morning the star of the group is anner cobercrombie f. Theyre up 12 . We have a Specialty Retail analyst at oppenheimer. This is a stock that lost 60 of the value in the last year. Have you seen improvement today . Absolutely. It was a feared stock coming into the fingerprint for sure. 35 of the float is short. That helps explain some of the move today, but it is encouraging to see the younger hollister brand show sequential immaterial proouchlt. Comps were down one. In the u. S. They comped flat talking about denim and tops. There is a resurgence of denim across the industry. Abercrombie seems to be benefits from that. The older Abercrombie Fitch brand is struggling. American eagle put out a good quarter. Is this coming back to live and are there opportunityiesopportu . We continue to like american eagle. Double digit comps while selling apparel. And the denim recovery is really driving that business as well. And we think that brand, equity, has been less tainted, Abercrombie Fitch. As a result of the market washout, what represents the best value in it was interesting that kors was a leader yesterday. The overall handbag was one of the most feared in the space. Those three stocks are down 40 . Remind us who those are. Kors, kate, and coach. That performance has been really quite terrible. Kors looks extremely cheap, if you think the estimates are attainab attainable. We still have concerns about their overall profitability being so high and eroding from those high levels, but certainly there appear to be some encouraging signs in the handbag space overall. The npd data showed some improvement this past month. I think overall, its been not a lot of newness in the category. We are starting to see some inflection points with that. So maybe that bodes well for some of those stocks. As far as the macro goes, going into the holidays, you have gas prices coming down. But you might have stock prices coming down. So whats the more powerful driver for spending . I think overall with the u. S. Consumer, were just not seeing a lot of demand when it comes to apparel. I think in general, the accessories and the handbags spend is outperforming that of apparel. Theres not a ton of newness outside of what we said on the denim category. Driving some of the apparel purchases. We think its going to be tricky, so youll have to be selective with the stocks. Consumers still favoring their cars and homes. Heart. The durable cycle continuing and the savings rate is still elevated. What about the Global Consumer . The story of the week has been a reset of global expectations lower. Who is most exposed to emerging markets in china . Coach, actually, 14 of their sales give or take, comes from china. You are seeing some of the benefit on a sourcing side. However, that coach has actually talked about so that will offset or help offset some of the top line volatility. I know ralph lauren, gap, they have international exposure. Is that priced into these stocks . We think for the main part, yes. With the stocks, again, underperforming pretty dramatically. Coach, actually, continues to be one of the few that we continue to like. 5 dividend yield is certainly very attractive. All right, and consumer discretion is trading higher, about 1 on the broader rally. Thank you for coming in. Well also talk to the kate spade ceo on the show tomorrow. Thanks for having me. If youre tuning in, a reminder that well take a live q and a from bill dudley. Reporter jeff, thanks for joining us during this volatile end of summer period. I want to start with oil. What set off this huge slump that weve seen in the last week and all the volatility that oversupply news not new. The weakening of china. This has been an existing story for a while. Theres a couple of factors that extend upon whats going on in the oil markets themselves. Its the focus shifted to whats happened in china. Theres a correlation between whats happening in china and the commodity story broadly. It extended into the broader Financial Markets. What about base metals . Weve seen copper and aluminum hitting lows. Weve heard from some Mining Companies that are troubled. Whats going to happen there and what could pull the companies out of the slump . I think when we look at whats happening in china, we look at across the entire commodity complex, the area showing the weakness command are things like iron oar, steel, copper and coal. You dont see the weakness in demand in energy. Gasoline and diesel, a perfect example. Gasoline demand is up 17 year over year. Diesel is 2 . Its the cap ex, industrial oriented. Things tied to the heavy industry in china thats being hit. Gasoline, are we going to see the savings that people are enjoying getting into Consumer Spending rather than just saving. It takes somewhere between 6 months and 9 months. We hit the trough in january, february, march, we should see the implications in late Third Quarter or fourth. Oil, youre bottom right now officially is 45. You were expecting to see that in october with some downside risk. Why havent you revised that sooner. We blew past that already. We came up with that range really based upon the idea to create financial vesz in the market. We calculated that 40 at six months starts to show shifts in behavior. The market needs to trade below the levels to establish a shift so we start to see a rebalancing of the market. We saw this autumn or next spring, do we blow out things in the u. S. Down to 20 a barrel. With you saying that, you mentioned a 20 handle, why theres spekepticism about your price target. We like to think about it as an average over a period. You can have spikes and down sides. I think the key point is to find a price level that creates Financial Stress on the industry and that price does it. And the 39 where we are today, its beginning to shift behavior. Were going into what i understand is a robust refinery maintenance season. It could dprez nonprices. We have credit talks that companies are having with bangs around october. We could see restructuring. Some people are seeing bankruptcies . I think youre being spot on. Looking at the two types of risks, one is Financial Stress. Especially when you get the redetermination of credit happening in october. But the other one, i think thats more important is operational stress. Does the surplus just overwhelm the system such that you cant deliver another barrel and youre forcing the shut ins. Its a race between which two get the market. If the operational stress doesnt get it, by spring its a serious issue. Oil, your price target is 10. 50. Gold. I look at nobody the interested in selling it or buying it. It gave upmost of the rally it achieved over the last week or so following the devaluation out of china. Going forward, if we continue to see improvement in u. S. Economic growth, were not too far off the 10. 50. Very good. Jeff, thank you so much. Back to you guys. Thank you very much, kate. Enjoying that conversation there. We got news that monsanto and syngenta are halted as stocks. Monsanto bid for syngenta. In the meantime, were building away from losses we had half the initial losses at 433 on the dow. Were heading back up. The potential for the day is a live q and a with bill dudley. Well bring that to you after this break. But it is not the device that is mobile, it is you. Real madrid have about 450 million fans. Were trying to give them all the feeling of being at the stadium. The microsoft cloud gives us the scalability to communicate exactly the content that people want to see. It will help people connect to their passion of living real madrid. No students ever been the king of the campus on day one. But youre armed with a roomy new jansport backpack, a powerful new dell 2in1 laptop, and durable new stellar notebooks, so youre walking the halls with varsity level swagger. Thats what we call that new gear feeling. You left this on the bus. Get it at the place with the experts to get you the right gear. Office depot officemax. Gear up for school. Gear up for great. Bill dudley of the fed is speaking. Were still waiting for the q and a. When we think he may perhaps address equity markets. When that happens, well bring it to you live. Welcome back to squawk on the street. We just got the number out from the government on weekly inventori inventories. Crude inventories down about 5. 5 Million Barrels. That was more than the original expectations but confirming what we heard from the American Petroleum institute after the close yesterday. Distillates, including things like diesel, up 1. 4 Million Barrels an gasoline stocks were up about 1. 6 Million Barrels. Very interesting week given the fact that a the a lot of participants were expecting a build. The widen refinery coming back online monday and were seeing relief at the pump in places like illinois and the midwest which had seen a gas price spike. Illinois down 0. 10 a gallon from a week ago. Well above the average at 2. 94 a gallon. Dw gasoline coming under pressure. Weve seen continued volatility when it comes to the crude price because the fundamentals overall continue to be very difficult. Nonetheless, this is supportive. Now over to sue for a news up in date. Thank you very much. Heres the news update for this hour. Two journalists were shot and killed during a life interview in virginia. Alson pa Allison Parker and adam ward were covering a story when the shots rang out. They know who the shooter is and are in pursuit. They believe hes a disgruntled employee of the company. They are discussing a commitment to the transpacific partnership. The president also apologized over the suspected eaves dropping by the nsa. Donald trump clashed with a reporter. He was escorted from the room. He was later allowed to reenter the room and ask questions. A giant wall of dust rolled over phoenix yesterday. The giant dust storm can be seen in this time lapse video moving across the sky. It was generated as an intense thunderstorm moved across that area at the same time. That is your cnbc news update this hour. Lets get back to squawk on the street. Simon. Thank you very much. The good news is that the market has been rising from here. We had dipped below a gain of 200 points which is important because its less than half the open which was up 433. Ma mirroring whats happened in recent sessions. Still awaiting importantly what the new york fed president has to say. . Lets take the q and a live now. I asked that you please give your name and your publication or media outlet when you ask your question. With that, mike. Yes. Id like to ask you about september. What would be the calculus for the september meeting. You say its more compelling or less compelling depending on the data. Is there a matrix of things youll be looking at and how important is the performance of the stock market in this . When we say that from my perspective, what were going to do is data dependent but thats not just about the Monthly Economic releases that come out. Theyve been pretty positive if you look at what we got over the last couple of days. Consumer confidence showed a good inkreecrease. Durable goods was positive. You have to look at the other things that could affect the Economic Outlook. Were concerned about the outlook. How is the economy going to perform in the future. Its not just today. Its all the things that affect the outlook beyond the next few months. And i think there, you know, International Developments and Financial Market developments have relevance. They can impinge and affect the economicout look. To me its a broad set of information. When i say data dependent, i mean all those things. U. S. , Economic Performance with respect to growth, employment, inflation. Whats happening in the interNational Economy. And then Financial Market development because that can affect Financial Market conditions which also can have either positive or negative effects on u. S. Economic growth. Jonathan with reuters. Can you elaborate on inflation and how the market turmoil affects your confidence that the recovery will carry on in the second half. If you look at the inflation data weve got ten over the las few months. The inflation is low because of the drop in Oil Prices Last year into early this year, and on a year over year basis. And then the core rate of inflation thats higher. If you look at it, its been running about 1. 3 on a year over year basis. What we expect Going Forward is we dont expect oil prices to fall indefinitely and the dollar to appreciate indefinitely. At some point those affects should fall out in terms of their impact on the inflation terms. When that happens, we would expect some of the things impressing inflation will be transitory so inflation will start to go back up. The inflation news, i think is its not been particularly surprising in terms of what weve seen. Theres two influences. One influence pushing inflation down. Stronger dollar, weaker commodity prices, but then the firming of the economy and the tightening of the labor market. So far it looks like the core inflation rate has been stable. Now, how could International Development affect this in well, obviously one thing thats happening in the Global Economy is were seeing a slow down in chinese growth. Thats a significant implication. And its creating strains on other emerging market economies. The dollar while its been weakening a little bit against some of the major currencies has strengthened against some of the major emerging economies. Whats the implications of this turmoil on the goods and services we import and how does it affect the inflation outlet. Thats how well be thinking about it. Reporter how would you character rise the recent selloff in the stock market . Do you see it as a correction or something worse . And how would it affect . Could it derail, if you could explain the ways it could derail the u. S. Recovery in. I dont have a view on why the stock market is doing what its doing. You know, obviously shortterm stock market volatility doesnt really have significant implications for the u. S. Economic outlook, because the consequences for peoples views on whats going to happen to their wealth over time it isnted by the shortterm volatility. The stock market has to move a lot and stay there for it to have implications for the u. S. Economy. Basically, economists look at the stock market not because we care about the stock market directly in terms of the impact on the u. S. Economy, but through the socalled wealth effect. So, basically, households in the u. S. Have wealth in a variety of different places. They hold bank deposits. They hold bond mutual funds and equities and they have a lot of housing wealth. And Household Net Worth affects peoples desires to spend or save, and so when Household Net Worth goes up, what you typically see is the savings rate drops and that provides forward impetus of the economy. A prolonged drop in the stock market would have some consequences for household wealth. And that might might, not necessarily, might weigh on peoples willingness to spend versus save. And that could have implications for the outlook. But i think history has shown pretty clearly that the stock market movements have to be persistent to have those affects. That shortterm volatility doesnt have much implications in terms of how people talk about what their wealth is over the medium to longer run. Reporter you used the words less compelling describing lift off for policy normalization. Giving all the market volatility and the devaluation of the yuan, does december or october seem more compelling to you. Ive said many times in the past that i hope we can raise Interest Rates this year, because that would be a sign that the u. S. Economic outlook is good and that were on track to achieve our dual mandate objective. We said we wanted to see further improvement in the labor market and we want to have reasonable confidence that we can meet our inflation objective. Theres a lot of things that shape that view. Lets see how the data unfolds before we talk about when it will occur. Reporter in april you said, i want to shift a little bit to talk about bank examinations. In april im sorry. No this conversation, were not going to discuss this. This is for the regional economy and the u. S. Economy, so we can talk about that offline. I dont even have the ability to ask the question . Were going to talk about it offline. Please stay on topic. Any other questions . Reporter could you say a few words about the opening on monday and the ways in which the market drops. Theres been talk about it being unruly . Traders talked about memories of the flash crash and so forth. Were you worried about the big drop . I dont think its appropriate for me to comment on the stock market. Thats not the province of federal bank reserve in new york. Reporter have the events of china over the last few weeks changed your view fundamentally on whether they might be able to navigate the economic slowdown or if its the risk of a hard landing thats increased there. Its hard for me to assess. Id direct your question to the chinese authorities. China has a challenging task ahead of them. Theyre trying to reorient their economy toward consumption and maintain a strong growth rate that can generate Employment Opportunities for their people. Thats difficult. And i think everyone understands thats difficult. The good news is that the people there are very capable, and they do have quite a bit of resources in terms of what they can do in terms of policy tools to use to help facilitate the transition. I think im reasonably confident in their ability to do so, recognizing that it is difficult to reorient an economy from investment to consumption which they have made clear thats their goal. Reporter have you seen anything early in any sort of data or anything that you look at that suggestions that maybe some of this financial turbulence is having an affect on the wider economy and if not, what do you look for, and if not, then why are you even mentioning this . Well, im mentioning it because the what i care about are all the things that could impinge on Economic Outlook. Thats not how the economy is performance but about what the economy will do in the future. T to the extent they could impinge, theyre relevant. I think its unlikely that youre going to see the effects of any of this in the Economic Data immediately. I think the first piece of data where you might start to see a little bit of effect is the university of michigan is going to release their Consumer Confidence numbers and they survey up to close to when they actually publish the survey. It will be interesting to look at that report and compare it to the recent conference readings on Consumer Confidence. That might be one place to see a little bit of an impact. The employment report is the other one that. Thats based on the survey. Its based on the survey the week of august 12th. Theyll be stale in terms of judging impact. I would also think these things dont play out like that. What were seeing is not a u. S. Problem. This is not something thats starting on this is very different than the financial crisis. The financial crisis was very much about us. Sub prime mortgage lending, securities, collateral, securities that turned out to be highly toxic. That was about us. This isnt about us. This is about developments abroad. I think what we have to assess is how the developments abroad would impinge on us. Were going to turn it over to the regional economy now. James . Reporter james with news day. I think my question is for president dudley and mr. Ore. Im wondering about long island and their economy. Long anld keeps thinking that was bill dudley speaking to reporters, taking candid answers, i would say, providing some answers of why a september rate hike looks, in his words,less compelling, talking about the International Developments and the sympttock market sell off impacting. Lets go to steve liesman. Steve, clues on the fed timing . Looks like september is off the table, right . Reporter i dont think its off the table. In fact, i want to play for you some sound that dudley had just before we cut in with cnbc where he did use the word less compelling but held out the possibility that, hey, if the data goes the way they hope it go goes, it could still be on the table. Take a listen. At this moment, the decision to begin the normalization process seems less compelling to me than it was a few weeks ago but it could become more compelling as we get information on how the u. S. Economy is performing. Reporter so, sara, i push back only on the notion of on the table. Its less on the table than it was before. They talked about the effect on inflation. Also saying that he sees the focus of this really about overseas economies, about emerging market economies, about commodities, about china, and less about the u. S. And so its not something thats u. S. Focussed. Theyre going to wait and see and he didnt see an overwhelming impact from whats happening overseas on the u. S. Economy. You know, another take away is toward the end when he said he hoped there would be a rate rise during the course of the year. He hoped there would be a rate rise. I want to point one thing out. We fell about 70 points in the dow, and obviously were volatile and theres a fight over market levels. Were down about 70 points and that was during a period of time in which he played up the pressures of underlying inflation. Should we mark that as well. Reporter i think youre well to point out the notion of this is really what the fed wanted to do this year. And, probably, still wants to do, is to raise rates this year. When he says i hope we can raise rates. Hes talking about the issues out there. He hopes that job growth is strong enough. He hopes inflation starts coming up toward the target so they can raise rates and he hopes growth is efficient for the u. S. Economy to withstand rates. I think thats what the central banker wants to happen. I also think it underscores how uncomfortable they are being at zero. They want to be able to make this move. Weve talked about that a lot, and these developments in the market overseas what the dollar are clearly setbacks for those intentions. It gives us a picture of what the debate is inside the fed and that is on the Economic Outlook and how the International Developments impact that. Well leave it there. A lot more coming from you throughout the week. We have to get to other breaking news here. For the last half hour, shares of monsanto and syngenta halted. They abandoned the bid after the raised offer i reported on yesterday was rejected again by syngenta. That raised offer to 470 franks and included a raised break fee from 2 billion to 3 billion. Not enough to meet the financial expectations of syngenta. And this morning monsanto said it will abandon its pursuit of that company. Always hard to pull off an unsolicited bid. It would have put together these two companies in the agricultural arena. Monsan monsanto, as i reported yesterday, was facing rising resistance from some of its large shareholders to its continued bidding for syngenta. The shareholders telling me we would much rather watch the Company Given the decline in the stock price over the last couple of months since it began the pursuit, wed much rather see monsanto buy back stock. In fact, in the release, say it will resume the implementation of its approved Share Repurchase program as soon as practical. I can tell threw are expectations of people close to the situation that in fact they will also increase is the amount of share these are willing to buy back under that program. Perhaps meeting some of their shareholders in terms of what their ask has been for monsanto to do were seeing the stock reopen here. I believe its reopened for trading, up rather sharply. Perhaps reflecting of course happiness from their shareholder base. Thatter theyre moving on and will use an underlevered Balance Sheet for capital for repurchase of shares as opposed to continuing what was a failed attempt to get syngenta. A very large deal syngenta was having a lot of concerns on the antitrust front. That stock is up and the Broader Market is still up sharply. The dow is up 260 off the highs of the day, but still looking at a 1. 7 gain by the dow. And 1. 6 for the s p 500. The roller coaster continues. This red hot stock has already doubled in 2015, its also been one of the most volatile trades on the street. How do you trade netflix now . Find out on trading nation. But theres more squawk on the street coming up. No students ever been the king of the campus on day one. But youre armed with a roomy new jansport backpack, a powerful new dell 2in1 laptop, and durable new stellar notebooks, so youre walking the halls with varsity level swagger. Thats what we call that new gear feeling. You left this on the bus. 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