Transcripts For CNBC Squawk Alley 20180104

Barrels, i believe, so you can see these prices are floating around where they were at this point. 61. 69, carl, is where we stand at this point. Thanks, back to you. Thank you for that. Jackie deangelis good morning, everybody, 8 00 a. M. At tesla headquarters out west, 11 00 a. M. On wall street, and squawk alley is live good thursday morning, welcome to squawk alley. Im Carl Quintanilla with courtney reagan, john fortt here at the New York Stock Exchange a lot going on take a look at the markets right now. Historic milestone passed. The s p and nasdaq hit some record highs, as well. Number of tech names hit alltime highs netflix, amazon, facebook, google, microsoft, ebay, and a lot more dan morgan is a portfolio manager. What a day, guys dan, do you think these first couple days of the new year are giving us a clue as to how the year is going to go overall . Well, im really encouraged, carl, by the pack the Technology Sector is doing so well. As you know, we saw a big selloff in the last couple weeks of december in terms of the year end. You saw a lot of profit taking on some of the names you just mentioned, so its very encouraging to me to see, you know, the leaders in technology doing very well and kicking things off as you know, tech was one of the leading sectors in 2017 but had profit taking in the last month of the year. And for all of the complaints about lack of exposure to the benefits of tax reform, uncertainty over repatriation, are those concerns all allayed, margin pressure, anything like that, dan . I dont think so. I mean, i still think that things are very, very positive the big things we always get are the big things built into the markets, so can the market keep going higher, i think theres a lot on the table from the things you just mentioned that can cause a catalyst Going Forward to continue the strength my biggest worry is the fed is going to dampen this thing out with rate increases and were going to get into the Fourth Quarter and people are going to start worrying about a recession. Were not there yet, but it will be interesting to see what happens with the yield curve with the fed funds rate and how the ten year reacts. Jeff, i want to ask dan this, as well, because intels a big holding of his, i believe, but what do you make of this action in chips so far this week . Intel down considerably, amd up on concerns about this vulnerability, not just in intel chips, but across many types of High Performance chips that are out there. What do you make of it so, you know, i would agree with a lot of what dan said so far, and i do think technology has done well based upon the fundamentals and what makes us nervous is if you get negative divergence where the sector continues to do well, but the data is getting worse. So i think you have to be specific and we own a number of Chip Companies broadcom, micro chip, for example, and i think the data on this front, whether its in the wireless sector or some of this infrastructure, the data center, these are trends that are not fads they are not going away. So i would use these as buying opportunities on selloff and we think the fundamentals within chips, which is just a component of technology, continue to be really solid all right and shares of intel do continue to trend lower, as we mentioned. New reports, ceo brian crkryzanc sold off stake in the company after the massive security flaw before it was made public. It was a scheduled sale, though, so not as if he just decided to sell and it was caused by this issue. I spoke with kryzanich yesterday about the defect and the industrys response. Its not a flaw, its working like it should we have learned that you can get access to that memory, but we have a mitigation, so were saying go ahead and patch this we havent seen any case of this actually being executed, and we have a fix dan, i believe intels your largest holding. Brian kryzanich was trying, i think, to sound as if this isnt a huge deal, but investors not necessarily feeling that way this morning what are you doing with intel . Are all of your questions about this issue resolved at this point . Well, john, you know, its obviously a big issue and led to renewed strength in amd and weakness in intel. Its something that will pass and well get through this other Companies Like microsoft and google are also affected those stocks are trading close to alltime highs. I would agree with your other guest. The fundamentals within semiconductors, and you and i have talked about this before, youve got machine learning, the buildout of the cloud, all these things in place that are really extremely positive that really echo back to the 1990s to have these kind of catalysts in place for semiconductors, so i think intel will get through this it is a large holding for us we look at it more of a dividend play we also own texas instruments, Applied Materials and some of the other, you know, semis in that space those things are all very positive i think well get through this and move forward and i expect technology to continue to do well jeff, technology has been doing very well through 2017 so far were seeing nice runs and, of course, were talking about the chip stocks, but beyond the chip stocks, looks like your portfolio, under 30 , is in technology you suggested potentially buying opportunities for the chip stocks beyond that are you looking to going in deeper in the technology stocks, and if so, where beyond the chip sector well, we do have diversified holdings were pretty comfortable, we have an overweight within technology, so weve already talked about semiconductors. Some of the chains we have liked, we sold amazon. Again, negative divergence where valuation continues to get richer the stock moves up, yet earnings estimates cut in half at amazon, for example. So you want to be specific and very selective, and quite frankly other areas that are very mundane within technology, visa, for example, payment processing, card networks. 10 revenue growth, double digit, almost 20 earnings growth, really attractive and levered to that Consumer Spending that continues to be strong so broadly we like it, but we want to be selective and i think were comfortable with the amount of overweight that we have right now visa, one of the slew of names setting alltime highs today. Guys, thanks so much see you next time. Contessa brewer joins us from boston right now. I hope youre staying warm i think i have a foot of snow on me already. Really, we have just seen the snowfall increase dramatically visibility has dropped dramatically in fact, im at copleys square. You cant even see across the square at this point its interesting how the wind funnels differently on different sides of the park. On that side it is gusting so hard, the snow hits you in the eyeballs and really stings so this is part of what people are dealing with if theyve got to be out and about today. The roads, as you can see, are treacherous, and there have been an army of snow trucks and plows coming through here, salting, trying to move the snow. They just cant keep up with it. We did just see the fedex truck go by, city buses are running, but people are urged to stay off the roads or use mass transit if they have to get into work today. Transportationwise, if people were trying to dodge the blizzard, its too late. Flights are grounded at logan airport. Up about 700 Flight Cancellations on the day roughly 3,000 flights have been cancelled nationwide, according to flight aware. The trains, amtrak is operating on a modified schedule, and the commuter trains in boston have been upgraded to do a good job of dealing with Winter Weather the throughway, theyve lowered speeds on i90 through massachusetts. Power situation, they are expecting 90 of customers to lose power for 72 hours. Part of the problem is the trees are frozen they are expecting downed trees to complicate the situation. Then, of course, the blizzardforce winds coming in i wanted to mention there is an archaeology conference in boston today, taking over a lot of these downtown hotels. And its apparently going on as scheduled, because im hearing a lot about archaeological digs or whatever, theyve got the people here already, so business as usual for some for others not so much, guys courtney thank you very much, contessa hopefully, you stay warm and safe out there thanks so much for your report from boston. Well, for more on graysons impact on the travel sector, were joined by gordon bethune, a cnbc contributor thanks so much for being here with us. Hopefully things look warmer where you are in texas just a little right you have a lot of past experience with storms like grayson. This one perhaps a little different because of the winds, but in general, look, it snows in the winter. Often on the northeastern seaboard, but it still does disrupt travel flight aware says Something Like 3,000 flights have been cancelled. So if youre looking at the Airlines Financial impact, how big is it . How many storms does it take to be material . Only thing that stops is the revenue input. All the costs continue, so, obviously, its going to hit the bottom line. This could be big, as was harvey on the flooding here those catastrophes, 50 to 100 million for a company would not be unusual today, the storms are cancelling a lot of flights cant get the crews or the ground workers to the airport, nor can the passengers, so its significant. Very significant beyond the snowfall, there are some pretty strong winds in some cases, you know, hurricane strength how different is that to deal with for an airline than a typical winter storm thats mainly just the snow impact . Well, first experienced big airports like newark and laguardia does meter in the traffic because you reduce the number of runways available, may increase spacing, so wind is a factor that will sometimes close the airport because they just cant operate in those conditions gordon, is the weather getting more extreme from where airlines sit from a business perspective . Is there data that airlines are looking at and considering about how often this is occurring, incidents like this, versus how often it happened in the past . We look at that, i mean i was there and its not measurable, because its not regular, so it does not be consistent year over year like a trend you could plot, but at the same time theres more people traveling, so the impact is bigger as far as magnitude of revenue and commerce lets just be glad this thing wasnt over the holidays it would have really been hurtful. Gordon, im curious as a ceo, how granular is your attention to daily operates in an event like this are you getting hourly updates, does scheduling and operations give you a report at the end of the day . How close are you to whats happening on the ramp . Obviously, i get the reports when they do things like cancel flights. Well talk about that. Well make decisions as a group and thats what airlines are doing today. Some of it is getting information from the faa saying they are going to cut the number of flights allowed or stop traffic altogether and finally, ive flown in the past few days through chicago. It was a mess. A lot of mechanics, multihour delays whats more challenging, the maintenance element of this or more of the scheduling getting people, as you said, to the right airport at the right time carl, its like a modern wristwatch any of the parts will take the whole thing out. It doesnt help if we have the airplane available but no passengers at the same time, mechanically and all the other ground issues still need to work, so all of that has an effect and its a negative effect on revenue hopefully, things get back to working order pretty soon and everyone stays safe in the meantime thank you so much, gordon bethune, thank you for joining us good luck getting home. When we return, bala Balaji Srinivasan on what to expect from cryptocurrencies in 2018 more squawk alley after this we are keeping our eye on the dow run past 25,000. But one asset class not participating, bitcoin down, lets see, 3 , 2. 5 , 4 . Depends where youre looking but as weve seen, that can change at a moments notice. Lets bring in balaji balasrinin from San Francisco good morning good morning. What are your thoughts on the state of bitcoin right now there is that big plunge to near 10,000 i think it was right around christmastime, and its rebounded since then whats moving bitcoin around so much well, i mean, its just inherently highly volatile, one of the things where its an internationally traded instrument, and so youve got all of these Different Countries and so somebody twitching in korea can affect prices in the United States. But year on year, you know, the asset class from one year ago, bitcoins up 13x, etherean was up, so thats Pretty Amazing for year on year growth. So its useful to look at the longterm numbers versus the daily stuff, where sometimes its hard to find an explanation. So where are you investing, then, cryptocurrencywise, and how has that environment been influenced by the volatility in not justbitcoin, but a number of different names in the space . Thats a good question. So, you know, personally im, you know, early investor in bitcoin, etherean, applications are good teams behind them right now we dont have the same metrics. With startups you have monthly active users or lifetime customer value, things like that we dont have that sophistication of metrics yet for coins beyond raw market cap, so because of that what i try to invest in our top teams with great cripping yptography and c sciences has that really changed the game at all for more Mainstream Investors to be able to play in the cryptocurrency yeah, custody itself is something a lot of people will pay for. If youre not a sophisticated cryptocurrency investor, you want somebody else to handle the private keys and so on some say that defeats the point, but its like training wheels. You just have the financial stake and eventually take custody yourself so absolutely, i think thats the first signal of a lot more sort of mainstream inspiration with the existing Financial System all right lets bring in mitch greene from leading edge Capital Investors also expecting a number of ipos coming through the pipeline this year we had the news from spotify yesterday, confidentially filing to go public not too long from now. Uber released its timeline for an ipo several weeks ago all of these could possibly provide another boost to the tech rally so, mitch, spotify planning to go out in a way that is unusual. What impact do you think that will have on the tech space, depending on if others follow suit how closely will that be watched . I think it will be watched very closely, actually its, obviously, a unique way to do it. You dont typically hear about ipos going where a company is not issuing new stock. For existing share holders, as we are, we think its a great idea we dont face dilution in the ipo at all spotify is an interesting company, though, for a couple of reasons. In order to do this, you need not only to have a very strong Business Model, one. Two, you need to not raise new capital, and, three, you need to have a very simple business to understand, because youre not going to have a traditional road show and i think one thing that could really help spotify, spotifys Business Model is really number of subscribers times average price they pay i think youre going to see a huge amount of retail demand from the stock, as well, that should not be underappreciated no different than, you know, than netflix sees or Companies Like roku. Were super bullish on the ipo mitch, is the threat of big licensing penalties i dont know if its an existential threat, but at least the retail demand i dont think so. The we first invested a couple years ago, we thought one of the big risks was, you know, could they reach agreements with the three major labels, and they have and as we talked to numerous music executives all throughout the industry, spotify is the reason music is growing. Streaming is the reason music is growing, and spotify is the leader in streaming. Taylor swift originally was on it, went off for a long time, and recently came back, you know, a few months ago maybe thats like the house of cards moment netflix had. We think the artists, the vast majority, really appreciate it we also think theres a huge opportunity for emerging artists by being able to go direct to their fans weve heard from many people in the Music Industry all the artist insights and analytics that spotify is able to provide to artists is absolutely incredible somebody can drop a new album and literally, you know, within minutes or days provide artists with, hey, where are people listening, people are listening to it in mexico city the most, buenos aires, amsterdam, and they can literally schedule tours around that and promotion events and things like that. Thats never been able to be done i want your take, balaji, because originality hasnt been necessarily meaning success. What do you think its going to take for spotify and other Startup Companies with original ideas to succeed in this era of huge competitors like apple, google, amazon, and so forth i that ones for balaji sure, sure. Spotify is ahead of apple music, they have 140 million actives. One interesting, you know, sort of angle here is that because of the recent tax bill, a lot of capital is going to come back from overseas. I think this year youre going see a Record Number of acquisitions so it may not just simply be the innovator wins or big company wins might be the big company buys the innovator with the huge amount of cash thats going to flow in. Certainly happened to beats when apple snatched them up. Balaji, mitch, thanks for joining us today for sure, thanks so much for having me. As we go to break, check of where we stand on the markets. Dow awfully close to session highs. Off just a touch, but well above 25,000 for the First Time Ever. Coming up next, breaking bad, more from the latest episode of our interview with bob odenkirk now starring in the post. Stay with us with a clear advantage. Fidelity, where smarter investors will always be. 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You know your family. We know Senior Living. A place for mom. You know your family. We know Senior Living. Together well make the right choice. We sat down with bob odenkirk to discuss his new movie and a light it shines on journalism, a profession thats been under attack. Take a listen. One of the things i love is to show young people in this movie a bunch of adults who are journalists, who have given their life to this career, and who are working very hard to get a story and ask what story matters and what part of the story matters and whats legitimate about the story lets do our jobs find those pages i might have something. Must be precious cargo. Just government secrets journalism has been run down so much by President Trump, and i think its great to show a group of journalists working hard and caring about what they do and maybe its a way to balance out the conversation about fake news and stuff the New York Times was barred from publishing any more classified documents dealing with the vietnam war well be at the Supreme Court next week. Meaning well, we could all go to prison nowadays so much stuff is outsourced and done individually and people have blogs and one of the great things about that is, an individual can go places that a corporation or group has a hard time getting into, but they dont have that process. Where they are refining the story, building it out, and double checking it and so here they are in the movie the post, journalists presented doing their job and we see what their job is as a group and challenging each other and getting the best out of each other and getting the story. And maybe getting it more right or at least more thoroughly than a person alone can do. I guess theres a point to both, but right now were just overwhelmed with information and theres so many places for people to source the information to get information, but you dont know whos legitimate and whos taken the care to put it out. The case of real news organization, they are putting that effort in spielberg was asked who the movie is for, and he said for people who spent the last 13, 14 months starving for the truth. Yeah, well, thats more political than i would be, because, honestly, i dont think its a partisan film at all. Interesting bit about odenkirk, he made his living as a comedy writer, snl, he wrote the chris farley character living in a van down the river hes playing with house money as an actor, now nominated for a golden globe in his role on better call saul. Hes got thoughts and fingers on lots of different thoughts taking on the environment for writers, hes had a role in netflix projects yes interestingly, we had a discussion, which well hear about later, about entertainers and whether or not netflix and apple tv, streaming, has become so packed with content that youre not as visible because of the challenges of curation got to watch binge for that information. Over to seema mody. Whats so interesting about today is this Global Equity upswing. 3. 5 swing in japan, dow passing 25,000 for the First Time Ever, and in europe youre seeing big gains across the board a rally of their own as the data shows a rebound in growth for europe the euro zone pmi jumping to levels not seen in seven years the italian markets as you can see up as much as 3 heres why led by fiat chrysler, up sharply in reaction to better than expected u. S. Car sales data volkswagon, daimler, and bmw on the back of the stronger auto sales number in the u. S. Banks participating on enthusiasm about the euro zone recovery, helping rates move higher, too. It leaves unicredit up among the leaders, up more than 3 Deutsche Bank and commerce 2015 unrest in iran you can see them leading the pack todays gains in europe, what makes this so interesting, taking place despite the euro and uk pound moving higher the euro is trading at a threeyear high, yet european equities still outperforming that is notable. Thank you very much, seema. Appreciate it. Lets get to sue herera for a news update at cnbc headquarters good morning, courtney. Good morning, everyone heres whats happening at this hour the pentagon says President Trump and south koreas president moon jaein have agreed to delay military exercises until after the Winter Olympics the winter games begin february 9th in pyeongchang, south korea. Thousands of iranians countering with antigovernment protests with allies of their own in various towns and cities in iran, chanting nationalist songs. The future of the protests are now in question after a week of unrest killed at least 21 people here at home, san diego is setting up tents to cope with a huge spike in flu activity at one hospital doctors say they are seeing an extra 120 to 150 flu patients each day. The centers for Disease Control is now reporting the flu is widespread in 36 states. And while the flu is taking its toll in much of the u. S. , a blizzard is blanketing much of the east coast on long island, windblown snow blankets highways. Once the storm blows out to sea, extreme cold is expected to be the next big weather issue to impact this region i can tell you, on my way in the roads were really messy. Thats the news update this hour, court, back downtown to you. Thank you very much, sue. Although the subways were empty today. Got a seat, so that was a plus, with people staying home when we return, more on the st cst storm that slammed the eaoa more squawk alley coming up after this yeah. Lot of Tech Companies are reporting today. And, hows it looking . I dont know. Theres so many opinions out there, its hard to make sense of it all. Well, victor, do you have something for him . Check this out. Td ameritrade aggregates thousands of earnings estimates into a single data point. That way you can keep your eyes on the big picture. Huh. Feel better . Much better. Yeah, me too. Wow, you really did a number on this thing. Sorry about that. Thats alright. I got a box of em. Thousands of opinions. One estimate. The earnings tool from td ameritrade. Dow crosses 25,000 for the First Time Ever this morning, plus better than expected data private sector jobs surged in the month of december, and thats ahead of the jobs number tomorrow our own Steve Liesman joins us steve, thoughts on adp today and what it says about labor tightness and potential inflation . Really strong number, carl, and if you looked across, you know, if you look into the details, strong job gains from small, medium, and largesized business and strong jobgains across sectors we did well in manufacturing, well in construction, and, of course, the Service Sector plowed ahead there is some tendency to overstate december relative to other months, but one thing we did see, carl, is a jump up of fed probability. More inflation, more certainty the fed is going to deliver the rate hikes were at 37 now for the third rate hike to happen in december, and we kind of pushed ahead that expectation for the second hike now. It had been september, now theres a greater than 50 chance it happens in august. So seems like we keep finding the workers. Wages dont seem to be going up too much i think theres great jobs boom weve been having can continue into part of this year anthony, your thoughts on that and whether or not the twoyear is suggesting the bond market is ferreting this out i think when you look at the yield curve, it continues to flatten, but its not inverted were still a little above 50 basis points when you look at the ten year versus the two year with regard to the adp, it does show a strong number, so people are going to be revising their numbers a little bit higher for tomorrows employment report, but if you look at the initial claims numbers since early december, theyve been sort of creeping higher, suggesting that maybe not this employment report, but the next one you might see a little bit more weakness having said that, of course, there is always a lot of noise among the claims numbers during the holidays steve, whats your latest take on wages and why they are not rising, and, really, how much further we can go before that becomes a notable problem, even if people are gainfully employed, they are not as gainfully employed as theyd like to be john, its got to happen soon we keep getting down well see what happens to the unemployment rate. We keep reading the feds account from their books when it comes to qualified and skilled workers that there were real bottlenecks in the employment market, but broadly were not seeing the job gains i think you still have issues of global wages arbitraging u. S. Wages. You have issues, essentially, of employers finding ways to fill their jobs without really increasing wages and doing so perhaps in a nonmonetary level issues, of course, of older people retiring, younger people taking their place at lower wages. Thats one possibility as to why it hasnt happened all you can do is watch the unemployment rate. If it gets down into the mid threes, youre going to see wages take off one point go ahead. One point with the wages, weve seen a couple hundred thousand people coming in from puerto rico into the United States, and i know steve has talked about the fact that when you look at the number of people coming from puerto rico, they are not included in the payroll numbers when they are in puerto rico, but if they come here, looking for jobs because of the terrible hurricane, all of a sudden they can add to jobs and not necessarily put immediate upward pressure on wages right now. And, of course, labor markets are tight. When you look at the National Federation of Small Business when they talk about how hard it is to find qualified employees, that index is one of the highest levels weve seen in 17 years. Even when you look at the number of parttime workers for economic reasons, again, that number is dropping down to levels weve not seen in over a decade labor markets are tight, but youre starting to see those people creeping back in, whether from puerto rico, couple hundred thousand, and more to come, or some people not in the labor force are getting enticed by the exciting labor market that when you look for a job, you can find one. Especially in a tight labor market key points to make about puerto rico, for sure. If we can bring it back to what were experiencing right now with this winter storm, even though gainfully employed might have a hard time getting to work today. When you look at the impact on winter storms, how much does it take to really see an impact to gdp, anthony well, i think its interesting, because if you look at the last ten years, what were starting to see is there seems to be less of a sensitivity to things like retail sales when the weather actually deviates from the normal so when you get a little cold weather, obviously, the retailers do better with their seasonal merchandise, but if weather is too good or too cold, of course, that is a little bit of a negative. But weve seen that to be a little less negative over time, especially as you start to see more Online Shopping opportunities. Online shopping, as you know, is now 9 of all of retail sales, so its not unusual to expect that if the weather gets too cold, people simply switch from the traditional brick and mortars and buy more online. Even those buying from the traditional brick and mortar, less sensitivity showing that over time less sensitivity to extreme cold weather one reason perhaps amazons at an lltime high, 1208 today good to see you, anthony steve, talk to you later on. Sure, pleasure. Coming up, more on how spotify solved a 1 billion debt problem ahead of its planned ipo. First, Rick Santelli, whats on your mind today well, another handle for the dow, 25,000 plus, while all thats going on, were down a quarter of a cent on the dollar index and up only one basis point in tenyear note yields. Wow. Im going to give you a big number 1. 97 million what does it mean . Tune in after the break. Im scott walker coming up today top of the hour on halftime report, a cnbc exclusive. What david tepper told me today about stocks as the dow hits yet another milestone. Plus the strategist behind the most bullish s p target on wall street he just upped his forecast today. Now hell join us to tell us why. Also, is it time to get out of Western Digital . One Analyst Thinks so. Were going to debate it in our call of the day. And the two bigname stocks john and pete say could pop based on unusual activity in the Options Market see you in about 15. John all right, we will not touch that dial, scott now lets get over to the cme and Rick Santelli for the santelli exchange. Rick thanks, john. You know, there was a commercial many years ago, wheres the beef, and it has become part of our vernacular to question a lot of things going on right now, though, i will answer the question superficially, wheres the beef, its in china. You know, last spring the president and the president xi of china got together and created a plan, and that plan had an offshoot, and that is resumption of beef exports after 14 years look at this bar chart from the usda 1. 97 million the big number is how many pounds of beef we exported in september. I know most of the talk in print we read regarding trade is mostly negative, not to say in some fashion it may not be warranted, but theres also some pretty big positives that seem to have slipped through the cracks theres another issue as to wheres the beef you know, i think if over the last three or four weeks my most common email or text is in regard to equities and today specifically i had more than most, because i have not been fighting this i havent been fighting it since november of last year, and as we touch 25,000, the emails read somewhat as follows. How could you be enamored with the stock market its all qe money. Trillions and trillions in Central Bank Dollars thats what is going on. Im not arguing its not a channel, but heres my question back what, we just discovered qe past, present, and future on november 8th of 2016 now come on, folks does that make any sense it was going on long before that and even the u. S. Started talks of taper before that so whats going on heres my rendition whats going on, and its awfully oversimplified, but i think it covers a lot of ground listen, theres offsets and theres in addition tos. No matter what you said, they say the new president is a fascist. I dont see it fascists usually dont follow rules, but the last president leaned socialist and that we can prove. I think an antibusiness president versus this president whos certainly not antibusiness is the reason for it the qe existed in the past but more on offset with regard to the u. S. Economy now its in addition to. Remember the old cowboy movies with john wayne . If your gun powder gets wet, it doesnt work i guess its not true for all thely liquidity do i have proof . Yeah, 25,044 back to the squawk alley gang. Yeah, thanks, rick. Market doesnt seem to care whos president , heading up either way appreciate it. As we head to break, take a look at shares of snap the stock sinking this morning on a study that says 96 of ad buyers would prefer to advertise on instagram over woul prefer instagram over snapchat more squawk alley after this with fidelitys realtime analytics, youll get clear, actionable alerts about potential Investment Opportunities in real time. Fidelity. Open an account today. Welcome back several retailers putting out holiday sales results. While jollier than expected, stocks are falling in reaction lets start with macys. Comparable sales in november and December Rose 1. 1 on an own plus license basis thats the first positive holiday sales result for macys since 2014s holiday season. Macys, bloomingdales, blue mercury and the outlet formats all improved and sales across a number of categories also grew, including bueauty, active apparel, children, home, among others but the twomonth holiday period is not enough to pull macys comps positive for the year although they are increasing its full year guidance, including guidance with tax reform benefits and also narrowing the Sales Guidance Gross Margins didnt improve as the street had hoped macys also identifying 11 stores to close. This is part of the 100store Closure Program that was announced in august of 2016. Those clearance sales are set to begin on january 8 macys shares are down about 6 to 7 in reaction. Up, though, about 30 in the last two months. So we have seen a runup when we started to hear inklings that the season was strong. J. C. Penney also reporting strong holiday sales, up 3. 4 . The company reaffirming its fullyear forecast like macys, j. C. Penneys shares down about 5 today but up about 48 over the last two months again, part of that runup when we started to hear that the season was strong. Costcos December Comp sales improved 11. 5 analysts have been expecting 8. 8 growth. The International Markets did, however, see stronger growth than what we saw in the main u. S. Market. Shares of costco down about 1 l brands too put out their December Comps those were up about 1 that was in line with what the company had forecast, but a little bit below what analysts were looking for margins hurt by some promotional pressure on those brands l brands up 20 or so since the Third Quarter reports. Kind of surprised, costco samestore sales beat but the stock is down. I wonder if they feel the run is out of breath. We had seen so much wind come off the sails of the Retail Stocks and saw some hope but now that we have these numbers, things are starting to fall off a little bit that. Still shows that it was a strong season by the numbers. The stock reaction is just in opposite, perhaps a sell on the news. If you had to put a reason on the price, macys price action has been all over the place. But selling off overall with Additional Store closures . I dont think thats it because thats part of that program. They told us they were going to close 100, they have just been identifying them slowly over time i think it was the strong sales and the promotional pressure wasnt as strong, but macys still wasnt able to deliver on that gross margin. I think thats something that the street was really hoping for, to be able to pull that back and it didnt quite happen for macys. Llb attributed some category exits in swimwear. That was really crushing. It was a really big category that they exited and thats a hard thing to make up and rebound in the existing categories. The president has been speaking at a pool spray at the white house after a meeting with gop senators about immigration. Hopefully everything is going to work out very well. We really wanting it to work out. I can tell you the republicans wanted to see it work out very well if we have support from the democrats, i think daca will be terrific we have people that have been working on this issue for a long time as lindsey said, as others have said, we really are at a point where i think we can do something spectacular for the people on the border, people coming through we have to be careful because theres a drug epidemic like the likes of which weve never seen in this country. We need protection we need the wall we need all of those things. Frankly, i think a lot of democrats agree with us when they see whats happening. When they see the kind of problems were having at the border they really understand it. Whether theyll vote that way is another situation but they really understand it so we want to thank you all for being here we have a great spirit going in the Republican Party i think it can be bipartisan i hope its going to be bipartisan we can take care of a lot of problems take care of a lot of problems it would be really nice to do it in a bipartisan way, okay . Thank you all very much. Did steve bannon did steve bannon betray you, mr. President . Any words about steve bannon i dont know. He called me a great man last night so he obviously changed his tune pretty quick. All right, thank you all very much i dont talk to him. I dont talk to him. Thats just a misnomer thank you. Thats the president responding to some questions about steve bannon and a meeting about immigration in which he largely says that any legislation pertains to daca will need to have a border wall and a cessation of the visa lottery and chain migration, which he says are bad for the u. S. Economy there were some additional headlines we got on the wires regarding the strength of the markets today. I wonder perhaps the pool spray will play that back later on but those are the headlines we have for now. Reporter thats right, carl. Sometimes you get a first cut and then a longer version played out after the fact you saw the president sort of downplaying the steve bannon criticism of the president there was the explosive political headline of yesterday, the dramatic political divorce between the president of the United States and his former chief strategist, which happened after the publication of that Michael Wolff book here you see the president sort of downplaying bannon and his significance at the same time, the president s lawyers are taking the extraordinary step of trying to block publication of that Michael Wolff book i dont think we can go back in recent history and find a precedent for an american president trying to block a journalist from publishing a book about the white house but nonetheless, the president s lawyers are going to make a run at that. We can let the lawyers debate whether or not its likely to be successful, but you can see the strategy here. Legally fighting back very, very aggressively the press secretary fighting back very, very aggressively yesterday and the president being more dismissive and clearly signaling hes ready to talk about other issues and move on, carl how do you handicap immigration legislation getting done with the president s job approval in the 40 range . Reporter you know, its tough. Democrats would like to do something on immigration i know the white house would like to do something on daca if they can finding a deal, if theres border wall funding, if theres chain migration, all of the caveats put into it. The question is whether democrats and republicans can come to terms of a deal with all the political chum swimming in the water. It might give the democrats an incentive to sit on their hands and not help the president get a legislative win at a moment when hes political vulnerable. That may be the problem they face at the white house. How do they entice democrats to do a deal without giving away the store, and thats going to be a very difficult problem. You have a very busy afternoon ahead of you meanwhile stocks obviously off session highs but up 28. 25k coming just weeks after 24k. The fastest onepoint surge in the history and well watch the winter storm lets get to the judge and the half. Welcome to the halftime report. Our top trade this hour 25,000 and beyond as stocks hit yet another major milestone, some of the biggest money on wall street growing more bullish today how far can stocks climb with us for the hour today, jon najarian from new york city, josh brown from minneapolis and pete najarian. Lets begin with the markets today. As we said, the dow crossing 25,000 for the First Time Ever an incredible run that some see continuing for a whi