Transcripts For CNBC Closing Bell 20240714

To report. Also trade representatives set to kick off a new round of china talks in shanghai. Earnings less than an hour away, well preview the key things to watch from that report with the stock up 800 on this 25 ipo price. Steve grasso from stewart frank, and a lot of moving parts, what do you do . It feels as if everyones on hold for the fed thats the most important thing thats happening right now earnings this surprised to the upside everyone usually, even last quarter, even was ready for a a into the earnings cycle. Steve is here with us for the full hour, and well be dissecting the market moves. Lets focus on the big stories the pharma deal, more fallout for boeing, and eamon javers. Viagra, lipitor, xanax and the epipen, pfizer is going to spin off or divest its up patent business and combine with mylan, and the new company will do about 20 billion in annual sales. It will get a new name and be domicile in the United States, a fact that could be attributed to u. S. Tax reform and an element we saw in the recent deal avi acquiring, allergan. Those talks moving in opposite directions. Pfizer dragging, mylan getting a much needed boost. Mylan has been challenged forever so they needed this deal they get a management shakeup. Pfizer needs to create something other than what they already have this gives them a different pipeline, so to speak. So obviously you see the price action thats what you would expect off the headline pfizer is probably a buy. Do you like the defensive tone on this the problem is yes to the dividend arm of it the problem is drug prices and this entire space is under fire from not Just One Party in washington but both, and this seems to be the only thing parties in washington can agree on this will have that target for the next couple of years. You like the pfizer trade off. Turning to boeing, frustration is growing among airline ceos over the companys 737 max. Phil lebeau with the latest from chicago. Ryan air pulled no punches talking about the uncertainty of the 737 max deliveries. We were originally expecting 58 aircraft for the summer of 2020 now 30 at best, it may well move to 20. It could move to 10 and it could move to 0, if boeing dont get their [ bleep together. Michael oleary said that he believes he was told over the weekend that boeing does not expect to have the 737 max software fix, it wont happen until october. He thought it was going to happen in september. We reached out to boeing, they said theres no change at all in the 737 max time line. This is what investors are focused on it is the production schedule. Right now it is at 42 per month. Remember, just last week, boeing ceo, Dennis Muilenburg said if the return to service is pushed out any further, there is the possibility they could halt production the New York Times out with an article over the weekend looking at the relationship between the faa and boeing in terms of the certification process. Boeing says the certification process has been in place for years. It has delivered a lot of safe aircraft over the last 20, 30 years. Its a process that has worked obviously whats going on with the max, was it a case where the faa was no strident enough in terms of checking on the key things that needed to be checked on for certification. Phil, oleary always speaks his mind thats why hes always such a good cnbc guest. Remember when he wore that flag outfit on brexit day. Exactly a great example. Speaking his mind there. Is that a sign that perhaps this is in fact what the ceos of all the airlines think privately but oleary is the only one to voice it publicly. Yes, in talking with executives in the airline industry, they are frustrated that they have the same amount of information you and i have. Its not as though theyre calling up boeing executives and boeing is saying heres whats going on the one phrase i hear from executives is were in the dark. That uncertainty combined with delay after delay after delay has frustrated Airline Executives were going into the holiday flying season, the second busiest time of year they planned on having these planes they wont have these planes therefore you get the reaction like you get from michael oleary. He said of rival align, norwegian, it deserves to go bust, its shocking. Calling out a rival to go bust. And he put a time line on it. I wouldnt be surprised if you see it happen by late september, october. Norwegian, they have exposure to the 737 max, and there are a lot of other airlines that have that exposure too, and we have talked about this before, its not like you can go down to the 7eleven and get another commercial airline. Their just not out there if you cant meet capacity demands, thats got to change. These are the clients this is who boeing has to sell to growing frustration. Ty heard it from gary kelly whos maybe not as forthright or comes with the curse words as ryanair ceo, but is it going to do longterm damage . It probably does do longterm damage but the question become ifs you or somebody like gary kelly, why doesnt he switch to air bus. First, hes not going to get planes right away, also thats a multibillion dollar decision to change from boeing and air bus, and vice versa because you have your mechanics and pilots and crews that are certified under certain air craft. You just cant switch on a dime. Its not like going from a toyota to a honda. Its a Huge Investment and huge decision while it will do damage, its not something, at least the p perception is its not where youre going to have your longterm customers say im not going to fly you anywhere. Saying they have no route in reality, steven, back to boeing, key levels youre watching for this. At 357, lets call it about 5 percent higher from here its a no touch. You dont have the suppliers, the customers have no clarity. The faa has no clarity no one has any clarity on the situation, including boeing. How do you buy a stock when you dont know what the true story is in the name i think it has to prove itself its had an incredible run over the years. Go to the airlines that dont have any exposure. Delta is up 25 year to date. Still expensive down 1. 4 . U. S. Representatives are heading to china for the latest round of trade talks eamon javers has the latest from d. C. Reporter as i stand here right now, you just dont get the sense this is the week where people think theres going ton a major breakthrough in the china negotiations we know the treasury secretary, Steven Mnuchin is part of the delegation, robert lighthizer, the u. S. Trade representative part of the delegation thats on the ground in shanghai the question is what to expect from this. White house folks i have been talking to today view the fact that they are having these talks this week at all as the success. You ask them whats the deliverable, whats the outcome from this, the outcome is the fact that they have put on this round of talks this week and therefore you dont get a sense there are anything but low expectations this week. Nonetheless, they are moving forward, they are talking, gives you the sense that there might be a path here to a more normal negotiating stream going forward. Well see whether that can bear fruit but for now, just the idea that the talks are on again, people are smiling about that at the white house. No step backwards, probably the key thing for the markets. The feds policy meeting kicks off tomorrow with the expectations for the first rate cut since 2008 former fed chair janet yellen weighed in at an Aspen Economic Strategy Group meeting. Although the u. S. Is doing well, i would be focused on wanting to keep it doing well, to keep the expansion on track, and i think in light of the risks, i would be inclined to a cut a bit. I wouldnt see this as the beginning unless things change of a major easing cycle. Lets bring in economic adviser, managing adviser at , s this not unheard of, calling out a policy decision. I think theres a reason janet yellen did this. I think shes trying to help her successor. I think theres a lot of people in the market who say if the fed cuts, theyre reacting to political pressure from the white house. I think janet yellen wants to help preserve the credibility of the fed by saying no, its the right thing to do. There are actually good reasons for cutting Interest Rates, so i think shes trying to help. The fact that thats needed, does that not highlight the extraordinary position were in. Is it plausible that the current fed chair asks for her help in this way. Im not sure he asked for it, but i think he was probably quite glad to hear what she had to say because this actually reflects recent fed communication. He went out of his way to talk about the need for an insurance cut, the global uncertainties, global slow down that is unfolding and these are exactly the records that janet yellen repeated this may not have been coordinated but welcome by the current leadership. Were in unprecedented times when the president weighs in on the fed on twitter constantly, days before a fed meeting. Does that ultimately influence the fed in any way or does it make the stakes higher for tomorrow based on how President Trump is going to react because we know hes going to. I dont think this influences the feds decision there are good reasons for the fed to cut Interest Rates. They have been talking about this for quite a while they are following the Economic Data also its an exercise in risk management, given the global slow down, and also there are, you know, theres a good reason to cut because inflation has consistently fallen short of target, and there is a risk that inflations get anchored below the target i dont think this is a reaction to what the president has been asking for i think the fed is doing the right thing, and the real question is, you know, is it going to be 25 or 50 whats your take on this i would have thought that janet yellen would be helping powell by saying they werent due for a cut. The perception is President Trump has pushed him into a cut, and we shouldnt have a cut, and hes doing something against his will i dont know if this is helping powell as much as its helping trump. Hes putting pressure on powell to cut when he didnt want to. Shes back the trump dynamic that we need a cut we have seen the feds come out on both sides of this. We have seen powell change gears. Now hes a dove. And we have seen rose and grant, hes a screaming hawk. It seemed to be before the blackout of the fed, so i think if janet came out and said we shouldnt be cutting, that would back powell more because the perception is he doesnt want to cut. You could have made the case for this cut. It shows a monetary authority, a former Federal Reserve chairperson supports a cut, forget the politics of it from the time she was raising to the time when powell wanted to raise, theres been zero inflation. The phillips curve is dead theres been a reason to not raise rates. You cant normalize. What im worried about is the fact that they dont have any ammo to further their endeavors in case we run into a recession. You need 5 or 6 to cut down to 0. We dont have that ammo anymore. Thats out there. The mystery i think is in what message powell will deliver on the cut. Will this be the start of an easing cycle will he hint at more cuts as the market expects or will he say, okay, we did our job its the framing of it that i think leaves room for interpretation is that a question for me, sarah . Yes, what do you expect him to say around it i think its going to be a dovish 25 basis points cut they may go 50 but i think its more likely 25 but with dovish language they will probably also announce along with it that they end quantitative tightening this month in july, rather than september as previously planned. I think he will leave the door open to another cut. Otherwise i think he would risk disappointment in the market joachim vels, thank you for joining us. A big test after the board, up next, well take a look at the stocks enormous rise. Were looking ahead to apples earnings tomorrow. Were discuss what wall street wants to see from that reporter. The dallas feds july Manufacturing Index comes in at 9. 3 up from 8. 9 in june. Dow is up 32 well rhtac beig bk. Tell him were flexible. Dont worry. My dutch is ok. Just ok . in dutch tell him we need this merger. in dutch its happening. just ok is not ok. Especially when it comes to your network. At t is americas best Wireless Network according to americas biggest test. Now with 5g evolution. The first step to 5g. More for your thing. Thats our thing. Wake up theres a lot that needs to get done today. Small things. Big things. Too hard to do alone things. Day after day, you need to get it all done. And here to listen and help you through it all is bank of america. With the expertise and knowhow you need to reach that blissful state of doneness. So lets get after it. Everything is all right what would you like the power to do . ® all right what would you like the power to do . ® Xfinity Mobile is designed to save you money. Whether you use your phone to get fit. Or to find the perfect gift. Youll use less data with a network that auto connects to millions of wifi hotspots and the best lte everywhere else. Saving you hundreds of dollars a year. The best network. Best devices. Best value. And now get 250 dollars back when you buy an eligible phone. Its simple. Easy. Awesome. Click, call or visit a store today. Left of trade. Dow is higher, nasdaq down 50. 5 . Consumer discretionary, the bottom sectors on the s p. Lets send it over to mike for todays market dash board. You know what they say, dont go to the supermarket when youre very hungry same thing applies when it comes to putting chart packages together i heard the music, hungry like a wolf heres the dashboard today totally stuffed, a stock that looks totally stuffed after the first course only the choice cuts, the preference in the market for the highest quality assets, we have a way of illustrating that, and eating machines, certain automated traders eating up stocks right now, and then a well fed bulls, which could be the case once we get this rate cut as expected if we get it as expected this week totally stuffed. I was looking at the performance as we all have of beyond meats since its ipo, less than three months since it came public at 25 a share. At the highs, the stock was up 800 i asked the data team to go back and look at all time great Growth Stocks and see how many trading days it took after their ipo to rise 800 , and here you see beyond me took only 85 days. Amazon was the fastest of the other ones and then you can go down the list, microsoft, 1,400 delays, starbucks, over 1,500 days, and then google, public in 04, 29,608 delaays. Investors have front loaded this vast opportunity you cant look at any other stocks and say beyond meats ultimate Market Opportunity is bigger and less appreciated at the ipo. I dont believe anyway it shows how high the bar is. I dont want to offset that extraordinary statistic for beyond meat but was it fair to say it was the smallest of all these companies when it ipod. I believe it would have been the smallest, although starbucks came public at a relatively modest valuation, and its very true that microsoft was already a giant Great Company when it came public, google was highly hyped. You could make the argument that at the ipo price, beyond meat was completely depressed relative to its opportunity in terms of valuation, but nonetheless, 800 in three months is a pretty big helping no matter what. Go get some lunch, mike, well see you in just a bit. Also small float is that healthy or unhealthy it depends on if youre talking about the product or the stock. All of the above. I think its unhealthy, you have everyone waiting for it to explode, when it does implode, do people carry that to some other meaning with the overall market, and i dont think it does have a meaning. I think the float size is very important. Just explain that shares that were issued so theres a scarcity in the share size or share amount that was issued you have this clamoring of people trying to buy up the shares, and a clamoring of people trying to short it, and when you get positive news, theyre forced to cover. No doubt big moves expected. Under an hour to go. After the break, were sticking with the food theme with analysts of upgrades and downgrades in the restaurant space, the names wall street says to buy and sell and reactions. Chief economist predicting a 50 basis point cut this weekend. Hell tell us why. Dont go anywhere. The closing bell will return welcome back to closing bell, weve got under 40 minutes left of trade time, a food themed word on the street. Everybody is hungry today. Atlantic equities initiating as coke and pepsi as overweight with a 62 and 145 price respectively citing sustainable growth. Deutsche bank initiating dominos as a sole with a 208 price target the firm basing this call on what its calling competitive intrusion of Third Party Delivery aggregators, which Deutsche Bank says creates an increase in choice for dominos customer base. They were first at nailing the delivery theme. But not everyone does it. Theres a ton of competitors. Downgrading starbucks, removing from the Companies Fox list the firm says the stocks share Price Performance has exceeded expectations and forces a downgrade. Jp morgan, traffic is down 1. 2 . Goldman sachs with a buy on chipotle, mcdonalds, putting a sell on jack in the box and wendys, i wanted to come back to the starbucks one jp morgan when it put it on the conviction list, had it on 20 times, has it 30 times now commends it for the performance of the underlying business but the stock has run up incredibly on the multiple line as well i think theres stocks that are going to get a multiple expansion. Youll see that with mcdonalds, and they have the digital asset, dynamic yield that makes them more efficient they get 70 of the revenues are driven through the drive through, so that experience, the more efficient you can make that, the more it drops the bottom line. That deserves a multiple expansion. Mcdonalds does. Mcdonalds does starbucks is up 50 . A lot of people think to your point has outrun its potential theyre up 65 year to date or thereabouts. Its odd to me that you would be backing names so long in the tooth. Youre talking about the goldman call, chipotle, sacs, i get the mcdonalds i can make the case for starbucks. When you have the other names, those are a little bit longer in the tooth. Goldman sachs, obviously not getting the credit as the jp credit morgan one. One upgrade. Jp morgan moving the market one. We have your last chance to trade, and steve is picking a name he first told us about back in may, and its down. You got tostick with those. Doubling down are you guys at least giving credit for the ones i gave i know thats your big winner. Give you a couple of those too. Pfizer and mylan shaking up the generic drug entry with a new deal, and Kamala Harris unveiling her new Health Care Plan well discuss what it all means for the space next soft music when i see obstacles, i create opportunities. When i see adversity, i find a way. When i hear never, i say now. 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Just under 30 minutes left to trade s p 500 down 2 10 of 1 , here are the things driving the action its the busiest week for earnings with more than 150 S P Companies set to report, including apple and trade representatives are set for a new round of china talks in shanghai. Time to get a cnbc news update with sue herera. Heres whats happening at this hour, everyone. The search for two teen fugitives wanted in connection with three murders in british colombia focused on york landing and manitoba the Royal Canadian Mountain Police say a suspect sighting has been reported. Based on the information received, the rcmp immediately deployed multiple resources to the community. Including the Emergency Response team, police dog services, Containment Team members, Major Crime Services and air Services Assets at least 52 prisoners were killed by other inmates in clashes at organized crime groups at a prison in northern brazil authorities said 16 of the victims were decapitated while others were asphyxiated. Fights broke out when breakfast was being served. Tsa officers at baltimore washington airport found a missile launcher in a military members checked bag the man was on his way home from kuwait he wanted to keep the laumplnch as a souvenir. It was not a live device but nonetheless, it was con fiscated unsurprisingly confiscated. Exactly. Lets send it over to make santoli. Over the course of this year, we have pointed out how within the stock market, quality stocks, highly profitable, great Balance Sheet Type Companies have been leading the market that has changed since you have aggressive stocks working. Look at this relationship within the Corporate Bond market which shows a very clear preference, again, for the highest quality, safest bonds, this is the hyg, a big high yield junk bond, and you see this long up trend over the course of the year this was the market panic in december, late last year here you have the stock market record highs and you have a clear uptrend in the high quality defensive tone i think you can explain it partially by the global scarcity of yield, and safe yield, having anybody buy corporate debt that has even a 2 to 3 yield on it it also shows maybe a nonconfirmation, the stock market rally is not about risk appetizing this is one dynamic, were going to keep watching. Thats a good one thanks. Lets dig in on the deal of the day. Fizer and mylan, creating a Brand New Company that will sell epipen to Pfizers Lipitor and viagra it is set to have 20 billion in sales next year. Here to talk more about how it reshapes the industry, jerry hoelz, and Chris Meekins first of all, jared, how are you telling investors to play this deal, stocks moving in opposite directions it seems like pfizer, in my mind at least, theres not really a great trade here. The deal is dilutive its going to take a higher markable to drive the stock up, and thats going to be the debate over the next two or three months between investors and themselves. Is this being seen as a defensive move by fpfizer. This is a business that had very high margins f you look at the margins, if you look at the numbers they just threw up, very impressive. Youre seeing the china impact as far aspricing hit the company the same way its getting out of a challenged business and the combination really is a merger between, you know, two businesses that are in pretty tight spaces now. Youre not so impressed with pfizer, what about mylan and the vote of confidence its getting here from pfizer is there value there that the wall street was not appreciating thats debatable, too mylans valuation, they are willing to part ways with the company at the all time low, so that sort of speaks to are generics getting better, does mylan feel like its business is going to be challenged over the next couple of years you could argue yes. These are two companies that dont want to be in generics as big as they were, and they were both willing to take percentages. Chris, whats your take away on this deal i think its probably one of the results were seeing from all the pressure from washington, d. C. On drug pricing. You look at what the Senate Finance committee did last week with trying to put a cap, basically saying if a drug increases by more than the rate of inflation, youre going to have to rebate that money back to the government. Some of the opportunities you have seen in the generic sector, and even in brand name, you put a drug on the market, increase it, 6, 8, 10, 20 a year, you may not be able to get away with doing in the future. Chris, youre the policy guy on health care Kamala Harris, medicare for all. Whats her definition, versus Bernie Sanders definition, versus joe bidens definition. Her definition, maybe ill be generous and say its evolved over the course of the campaign. She went from being a cosponsor of Bernie Sanders bill which would have eliminated private insurance and forced everyone into a medicare system to then being against that after she had raised her hand on the stage saying she supported it, to now shes in a position where she wants everyone to be in medicare but shell allow Medicare Advantage like plans to continue to be offered, so an individual can choose traditional medicare or they can choose Medicare Advantage similar to what we see the choices seniors making now so whats the take on whether the spectrum of positions are on this topic across the democratic candidates, whos the most extreme and wheres the middle ground. I think the sanders is the most extreme, considered by most americans as well as investors, and you know, this new policy about harris seems to be pretty centrist, appealing to both camps to try to, you know, ignite some debate about what makes more sense, a universal Health Care System or partially, you know, run by the private system, which is what she is recommending here. Its very neutral. Health care still the worst performing group in the market this year. Its only up about 6 to 7 who is the market taking seriously when it comes to these plans and which stocks do you want to avoid . The stocks that have been carrying the market broadly are the ones carrying the health care, large caps, secular growth, somewhat defensive i call like the antihealth Care Health Care stocks, names like abbot, thermo, united, those are the names that are driving health care higher the rest of the space, including pharma is tough. Because of politics yes, i think drug pricing in particular, and then just not knowing exactly how Health Care Reform is going to play out post 2020 is the other driver. So if the president is reelected next year, does health care bounce or is this as you implied earlier, both parties are going to he has been just as aggressive against drug pricing and health care, i shouldnt say just as aggressive, hes probably the least of all evils, but both sides grae agree on th, and the Kamala Harris plan is overhauling our drug care or health care over ten years, sanders over four years. I dont think hell be able to do it over four. Its crazy that the bar in the Democratic Party is whether or not you want to keep prooiiv insurance in business. How did we get there Kamala Harris is pushing the Medicare Advantage, and we see the biggest pop in humana over a percent. I think to your point, were trading on all of these things as if theyre happening tomorrow the space in the Democratic Party is vast, and theyre all going left of left, so we have to give it a little bit breather time, but no matter how you slice it, its still a head wind for the industry. Well leave that discussion there. Jared and chris, thank you so much for joining us. Weve got 21 minutes left until the close. We are lower on the sp s s p and nasdaq slightly higher on the dow. And keep in mind, a record close for the s p and nasdaq, on friday after the bell today, earnings from beyond meat and dish, well preview what to watch in those reports coming up for your heart. Your joints. Or your digestion. So why wouldnt you take something for the most important part of you. Your brain. With an ingredient originally discovered in jellyfish, prevagen has been shown in Clinical Trials to improve shortterm memory. Prevagen. Healthier brain. Better life. Or trips to mars. 4. 95. Delivery drones or the latest phones. 4. 95. No matter what you trade, at fidelity its just 4. 95 per online u. S. Equity trade. No matter what you trade, at fidelity on a scale of one to five . One to five . Its more like five million. Theres everything from happy to extremely happy. Theres also angry. Im really angry clive actually, really angry. Thank you. But what if your business could understand what your customers are feeling. And then do something about it. Turn problems into opportunities. Thanks drone. Customers into fanatics change the whole experience. Alright who wants to go again . I do i do i have a really good feeling about this. Shares of lyft falling on news of an executive departure at the company rahel solomon. Lyft coo jon mcneil is leaving. Hes been with the company less than a near and a half lyft has not commented but there are reports the company will not replace him. Interestingly, we saw something similar when mcneil left tesla that position wasnt filled either lyft down 2 1 2 . Thanks for much for that. Whats your take on both lyft and uber had a couple of months to settle clearly not doing what a lot of other ipos have done. Its a competitive business in nature, and obviously uber took everyone off guard on the ipo process. Everyone thought it was going to be a screaming success from day one. We didnt see that t. If y suber has a uber has a lot more diversified strengths in the longer term, uber is probably still a buy, even if they fragment out the business sections it hasnt been what the market thought it would be. What do you do with executive departures, a ceo leaving after 18 months. In ubers case, i think they cut a third of their marketing staff lately are those sell on the headlines for a quick trade or something fundamental . The market always likes to sell on the headline, and sniff out, no matter what the reason publicly thats disclosed, they like to make up their own stories. Sometimes its probably something thats not harmful or bed but the truth is 99 of the time, the market treats it as theres something vile about the whole process. So lin corp. Is down 5 today. So how would you like at that, maybe a one day off thing. Cyclical is going to come back also its a 4 yielding stock while you wait that yield has been good the dividend has been dwogood fr 85 years the market has to start valuing cyclicals more than growth is now. You get that Inflection Point which i feel were at. Oln is probably the best in the space. Why is it down this much today . You have people playing ahead of earnings and dumping out the cyclical nature of the marketplace because theyre feeling that the Global Growth aspect, and growth here is not up to snuff. This is one of your picks that hasnt worked yet mcdonalds, is up 8 , since you recommended the end of may gs up 3 since the middle of june match is up 20 i left that one out well talk about that some other time trust me, im waiting for it to turn. I have been early. Early is wrong on wall street. Im waiting for it to turn i still think youre okay. Steve thank you for joining us today weve got under 15 minutes left to go before the closing bell, lower for the s p and nasdaq, pulling off the record closes where we landed on friday. The russell 2,000 performing down the dow remains positive, a little bit of a defensive in todays market, j and j, intel, and 3 m, pfizer is a drag. Well tell you what to watch for in Quarterly Results next hour. As we head to break, heres a check on our own score card, 76 beaten, 7 met, and 17 missed, were back after a short break. Always wants to hang out. Bor and you should be mad your smart fridge is unnecessarily complicated. But youre not mad, because you have e trade which isnt complicated. Their tools make trading quicker and simpler. So you can take on the markets with confidence. Dont get mad. Get e trade and start trading today. Dont get mad. Here, hello starts with hi mple. How can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Welcome back to the closing bell a little bit of a jump in the last 50 minutes, dow up 2 s p down 0. 1 . Any positive to the s p would be another record were not quite there for right now on the s p certainly not as things stand for the nasdaq or the dow. Health care, real estate, financials, discretionary communication, Services Bottom lets check in on individual market movers. Shares of London Stock Exchange jumping on news its in talks to buy refintive. The proposed deal comes a year after black stone bought a majority stake in refintive from Thompson Reuters you thought it was interesting. It continues the theme moving away from being a marketplace to exchange, and sellers of Financial Data its a rival for bloomberg, cme, ice, and well see if it plays out. The other thing of note is how good this stock has been on a tenyear view and 12to 18month view, since its attempted merger got blocked, and relatively new ceo, david swamchwimmer and heineken, the worlds second largest brewer said higher packaging costs have offset an increase it did close at a record all time high. So its down 6 relative to that, and the fee for hin kin has been outperforming the rest of the world with beer sales kontsi continuing up sgr you kn continuing up. You know what else they blamed, rain in spain. But still had growth in beer sales in every single region which has not been the case for a lot of u. S. Brewers, heineken down today. I think its coming up, dish, aditi, first with you. Beyond meat shares went up last week, currently in the red going into the close time line growth in the quarter and guidance will be key analysts forecasting q2 revenues of 53 million, a more than 30 increase from last quarter the street looking for q3 revenues of just more than 69 million and full year revenues of 224 million one factor driving guidance new partnerships in the last two weeks alone, beyond meat has partnerships with blue apron and Dunkin Donuts lets get to Julia Boorstin with what we can expect from dish. When dish reports, the focus will be on what the company says about its mobile plans how will it move the mobile assets from buying tmobile. The assets is buying from tmobile, including boost mobile the satellite tv provider and expected to transform the business with the Wireless Network, expected to be called sling wireless as well as a 5g network. Could overshadow dishs revenue, which is expected to climb 9 , and earnings per share, expected to decline we have 7 minutes after trade. Dow is on pace for second straight day of gains at the moment the s p is slightly lower, only by about 3 points. If it gets an uplift, we could have a record in our hands, not currently as things stand. Were back in a couple of minute s. You should be mad that this is your daily commute. You should be mad at people who forget theyre in public. And you should be mad at simple things that are unnecessarily complicated. But youre not mad, because youre trading with e trade, which isnt complicated. Their app makes trading quick and simple so you can strike when the time is right. Dont get mad, get e trade and start trading today. Welcome back, weve got four minutes left of trade time lets trade to close with managing director, u. S. Equity, mike, i think last time you came on, you said we would do a couple of a percent of pull back is that still your position that remains my position. When you look at where we are, this week is arguably the most catalyst laid week we have had in 2019. We have the fed, the boj, nfp, a bunch of other Central Banks and positioning happens to be as full as its been in a while, too. Youve got kind of a push, pull, fed funds expecting one thing and the fed maybe only willing to give another. Theres a pretty big divergence between the two. Last week when the ecb came out with their decision on rates and gai guidance in terms of having qe it was less dovish and we saw the market sell off, 15, 20. The warning signs are there for me, which is full positioning against what might be a disappointing amount of dovishness we get from the fed the last thing i would say to that is that, you know, ultimately the fed will come to the rescue, but you have either really weakening Economic Data where the fed is going to cut more in line with fed funds futures or better data and the fed will not be as aggressive. In the latter case, theres a case to be made that the market would sell off because the data is getting better, which means they have to adjust the rate expectations either way, i think theres a point coming up, youre going to see a pull back in the market, and i think people are coming to buy that. Mike lewis, thank you. Thanks, guys. Lets send it back to mike santoli. Eating machines in this case are systematic, Quantitative Investment funds that have been fe feasting on stocks the blue line is the leverage or aggressiveness, and the large positions of systematic investors which basically use these formulas to decide what their exposures to extiquities going to be. They have been lift allocations to equities. Yields are low volatility is low. As long as thats the case and the trending market is higher, they will ratchet up exposure. These are discretionary hedge fund managers. If you see its basically been the kwanquantities, the massive divergence, were not there yet, it does give an indication of who the incremental buyer has been on this orderly rally of new highs. Lets get to rick santelli. Two day of tense tells you everything you need to know. Were not going anywhere quickly. A drift down one basis point you can see this is the 9th session were going to be closing in ultra tight range between a yield of 2. 02 and 2. 08 the stellar performer of late has been the dollar intdex. At one point today it was within an 8th of a cent lets go to the nasdaq bertha couldnt get in positive territory today. Chips have been somewhat positive the biggest movers today are involved in deals. Mylan positive on the deal with pfizer meantime, exact sincience is no getting appreciation on the street over to bob. And a lot of indeterminate trading down here. We are marking time until the Federal Reserve meeting on wednesday. Small group of new highs, at t, visa, u. S. Bank corp. , and none is visiting a particular pattern. Theres the closing bell, the dow up 26 points if youre just joining, good afternoon, welcome to the closing bell, lets take a look at how we finished up the day on wall street. Dow, one of the big four higher on the day, thanks to strength in pharma names and other defensive names. Up about a tenth of a percent. It lost steam. S p 500 loses a little more than a tenth of a point, the nasdaq down about 4 10, and the russell 2000 down 6 10 something that stood out, the cyclical names you like to see rally when things are good and the Economic Outlook is strong, they didnt do well today. Financials didnt do well. Consumer and discretionary, worst performing in the market facebook, google, Materials Energy and so on, sort forth, t was under pressure in what many are calling position squaring. The body financials, afternoon trade in particular that saw them sell off yields were also low across the board. Tenyear closing at 2. 06 . Interestingly, though, the dollar ended the day plat, despite starting the day stronger, and the pound ending as it was all day sharply lower. Weaker weaker. Im going shopping. Im going home with you. Were on earnings watch, awaiting numbers well bring you those results as soon as we get them. Joining us to talk about the market, peter takimi, lori, head of u. S. Equity strategy and rbc capital markets. Mike, how would you describe the action leading into the fed, trade talks and everything going on this week. A little bit of softness. Holding near the highs the market was flap before we opened, during the market day, and pretty much finished that way. Below the surface, i think theres a little bit of a rethink in trying to ask the question of has the market figured out and priced in the good stuff that we expect from the fed if thats characterized as good stuff. The thing that struck me is some of the profit taking calls got some traction. You see the Software Sector down more than 1 a skeptical article. Downgrades of things like starbucks and pay pal also got traction, so people are a little bit, you know, maybe aware that the market has run and some stocks are looking a little bit hot at these levels. Overall, were just kind of waiting. Peter, you guys have been bearish for a few months. Hes not impressed with anything, earnings, fed. Earnings havent been good. What makes you right, even if youre right, earnings havent been good, the market has welcomed them. This is not unusual to me whatsoever markets get well over bought, and well over sold i think were in an overbought phase, and they tend to last a little bit longer than the over sold phases, ignoring earnings and fundamentals its really pricing in a pretty impressive goldilocks scenario, which i just dont think were going to get i think the fed has to absolutely deliver a perfect message if were going to continue to get a rally here earnings have not been good. Whats a perfect message. I think the perfect message would be were not concerned about growth were going to cut at least 50 points toward the end of the year i dont think thats the message theyre going to deliver because it would be inconsistent. Do you think thats the message were going to hear . Whats needed for the market. We have pencilled in insurance cuts and they have lightly pencilled in the one in december i think whats interesting is the bullish elements of the market, the people who have been dragging us to the highs are counting on getting a lot of stimulus, not just this year, but next year. I worry if we get the message out on insurance cut, markets arent going to like that. Mike, if we look at some of the recent decliners, one of which is a good example, starbucks did have great earnings and its starting to sell off a little bit. I think if it goes beyond the day of the downgrade and you essentially say, really has priced it, the world class branding Growth Stocks, everybody can find the obvious reasons to love, you would worry about it being a loss of leadership we have to see if it continues. We have earnings out. Aditi has got them for us. Lets start with the top. Revenues for beyond meat at 67. 3 million thats a handy beat over 52. 7 million that the street was expecting on the bottom line, its a big gap there a loss of 0. 24, versus a loss of 0. 08 that analysts were looking for. Thats a big miss as the company can account for how much the company is investing and spending in scaling up the Company Raised its full year guidance the revenues to 240 million up from 210 million, which they were projecting last quarter that seems to be folding into their revenue beat, and right now, the stock appears reiterate flat right now, which is what we were not expecting we have seen so many volatile moves in either direction. Well keep an eye on it. The changes in the three months are just crazy. Hundreds of Percentage Points in terms of the restaurant and food Service Contribution to revenue. The retail contribution, i mean, it ranges from 200 to 500 higher what do you do with results like that and evaluations one thing i would do is recognize the fact that this is a 14 billion company and run up 780 has nothing to do with what it was doing in the past three months i mean, not nothing to do with it basically its a massive extrapolation of it. In an acceleration phase fundamentally. All the partnerships announcing are very quickly getting transaction. Doesnt answer any of the questions as to whether the company can get the kind of scale in production and Customer Loyalty thats essentially already priced. The beat is on the revenue. The eps is irrelevant. They raised full Year Revenue Guidance but most of that raise was what we just got in the up side revenue. And to that point, full Year Revenue Guidance, 240 million, market cap 14 billion tells you all you need to know on that. My question is this a stock specific story or does this Say Something about the move, the level of risk taking in the market, the hunger for growth talks. I cant comment on them specifically but i do think what we have seen throughout the first two quarters plus this year is this insatiable demand for secular growth at a time when the Economic Growth has been sputtering. What was interesting about what mike said earlier, software, were starting to see profit, thats a bigger risk as we get closer to october. Thats when you have the first big round on year ends of mutual funds. I think thats a bigger and bigger risk with these kinds of stories. Peter what sector is most exposed when your thesis plays out. Financials are exposed and cyclicals have rallied semiconductors are trading richly at 25 times when you look at a Company Beyond meat, its hard to justify 60 times valuation small caps have been underloved and underperforming by quite a bit. If you look at the performance of the russell versus the s p, it bolsters the argument that people are trading on momentum. I would point out the one thing to watch for beyond meat is the lock up operation when insiders can sell. Thats going to increase the flow 180 days of after the po. You cant blame an insider for selling a few shares. Its not about the signaling. More available. Its about the supply and demand dynamic. Julia boorstin, tracking those. Dish revenue beating expectations, 3. 21 billion, versuses estimates 60 cents in earnings per share, 5 less than analysts expected the Company Closed the quarter with 12. 03 million paid tv subscribers. 9 1 2 million dish subscribers, and 2 1 2 million sling tv s subscribers. Whats the key. A tough part of a tough business the report doesnt change to but the stock has been a pretty rough performer. I think its obviously wasnt building high hopes for this quarter. Senator Elizabeth Warren rolled out her new trade plan today part of which includes setting preconditions for countries that are negotiating trade deals with the u. S some preconditions include being a part of the paris climate agreement. Eliminating domestic fuel, fossil fuel subsidies, not appearing on the treasury departments list and the list goes on and on guys, peter, the take away, i read the whole plan, i think its going to be hard to make any trade agreements after these restrictions but more on the protectionist side than on the obama trade, lets to multilateral trade agreements. Is this just going to be the way of the world if now republicans and democrats have a more protectionist tilt toward free trade. St tennessee an interesting reaction to the fact that if you look at tradition that will policy, whether its fiscal or monetary, it hasnt really worked youre seeing a bipartisan embracing of tougher trade and at end of the day, though, what i think that misses on both sides of the aisle is the fact that most of the growth we have seen after the financial crisis has come from productivity gains outside of the United States has it been great for the u. S. Necessarily for workers. Maybe not, but in terms of Global Growth and the size of the overall trade, benefits the consumers that we import from more Productive Companies overseas. Close to h u. S. China trad talks continue this week. I think that we have had a lot of its not getting worse and the markets have been kind of side wised, drifting up a tiny bit i think the only thing thats going to litigate lets markets break out of this range if we have been stuck in the rut, we get a deal with firm details around it. The market has been fooled multiple times with empty promises i dont think theyre going to fall for them again. The only point i would push back peter, not saying earnings are that great is actually guidance hasnt been that bad. There was a mystery going in as to whether there would be lowering across the board on trade and certainty. There havent been major breakthroughs. Dollar is still strong Global Growth is weak. And theres no major disaster. Guidance hasnt been great. Its been reviled to flat to slightly negative for q3 expectations are minus 2 1 2 . If the full year is going to be positive, otherwise were going to be looking at flat to negative earnings. Unless you get multiple expansion, which means the fed is going to have to be pretty aggressive, which i dont think were going to get. Peter and lori, thank you very much for joining us. Up next, we will discuss plt fed will cut Interest Rates by more than a quarter point that wall street is expecting were going to talk to one economist who expects bigger. The stocks massive rally, later on closing bell. Just ok . in dutch tell him we need this merger. in dutch its happening. just ok is not ok. Especially when it comes to your network. At t is americas best Wireless Network according to americas biggest test. Now with 5g evolution. The first step to 5g. More for your thing. Thats our thing. Stand up if you are first stand up if youre a mother. If you are actively deployed, a veteran, or youre in a military family, please stand. I will tell you this, Southern New Hampshire university can change the whole trajectory of your life. Wiswitch wireless carriersn bring in your own phone, and save hundreds of dollars. Its pretty much the easiest way to save since sliced bread. Sure is. Because savings is as savings does. And sometimes youve just got to stop and smell the savings. Im sorry, i think you mean roses. Oh right. You need to stop and smell the roses of savings. Bring in your own phone, switch to Xfinity Mobile and save hundreds of dollars a year. Now thats simple, easy, awesome. Get 100 back when you bring in an eligible phone. Click, call, or visit a store today. Welcome back, a mixed day on wall street. The dow high for a second straight day while the s p and nasdaq closed lower for the second time in three session Bert Bert Bert bertha koonz at the nasdaq staying positive territory overall for some of those sectors. Dow leaders and laggers an odd mix today. Johnson johnson, 3 m, caterpillar leading. Pfizer and boeing lagged noticeably pfizer was to the downside new highs, modest new high group. Colgate, at t. Not a particular pattern in the new high list. We need to see a little more breakouts back to you. Nasdaq big u. S. Und underperformer lets go to bertha, a little bit of overperformance, and chips, and set to report later on this afternoon. The street is looking for 1. 78 on 2. 2 billion in revenues and was upgraded this morning by ever core. We have had new highs from Texas Instruments and from olin which is going to be reporting later this week. Apple, tomorrow, and today, top 210, the First Time Since may 3rd. Didnt stay there. Went back into correction, but its poised to fall out again if we see good numbers tomorrow back to you. The meeting kicks off tomorrow with a rate cut since the First Time Since the financial crisis as of today, 73. 9 say the federal cut by 25 points, why 26. 1 say it will cut by 50 points. Former Federal Reserve chair janet yelling gave her take on the upcoming fed decision at the aspen Economic Strategy committee. Although the u. S. Is doing well, i would want to focus on keep it doing well, keep the expansion on track in light of the risks, i would be inclined to cut a bit i wouldnt see this as the beginning unless things change of a major easing cycle. Lets discuss now, chief economist and global economist at morgan stanley, and matthew, chief strike thattiategist at m youre expecting a 50 point cut. Why not 25. Essentially if you think about the fed and its Decision Making right now, its a dual mandate model they are working with core pc inflation is work at 1. 6 and when you think about the job market, you have to think about the Global Growth outlook. We dont think the u. S. Is immune to the global slow down when you think about the job market, the momentum is already slowing and we think with the way the capx numbers are, last week, the capex was down in the Second Quarter and the impact of the global show down will show further on the capx numbers, on the job numbers, if at the present times to be preemptive, it needs to cut 50 points. Matthew, why is he wrong . He makes very good points, but its a question of what you should do, and what youre going actually going to do my wife thinks i should clean more around the house. None of that is going to happen. That is right. They had a chance to guide the market to 50 just last week. Will m williams gave a speech 70 . And then the new york came out two years later and disavowed that statement theyre carefully managing the market i believe theyre going to go for 25. Theres also the data were showing this tracker and it has all been fairly positive lately, at least the biggies, jury box, retail sales, durable goods. Its kind of a trefcontroversiau to begin with. The data is great, why should we be cutting interest rating why would they go even further into a cup. Everything about the key number the feds should be looking at and will be looking at is the capx numbers when you think about the neutral rate or the rate at which the economy is not too weak is going to be influenced by what the capx numbers are doing, and there will it will be the key determinate the fed will be looking at capx is very leak and when you think about the outloom of the assets, the corporate sector in the u. S. Is thinking about whats happening globally, and taking its capex decision. When you think about the Global Outlook, look at numbers like manufacturing, bmis, globa trade volume 2016. Its not a majority of our economy. The economy is consumer and the consumer is doing okay. When you think about the economy, job and retail sales are lagging. It has got to be within an outlook the in mind, not just looking at the trailing data, and reading the fed is moved around to be thinking about the outlook in a forward looking manner, at the same time, we think the fed mentioned u. S. Is not an island economy. Its linked to the Global Economy. There was divergence in the Global Outlook thats because of the tail wind of fiscal policy, and we are beginning to see the impact in a few sectors, we think this will get more broad based they have to get ahead of the game, and we think they will thats what the top three policy makers have been in their speech last week mentioning this. So i think with regard to clarification that was issued, im not sure how it came, but it was through a prodded question if i ask you a question, is this statement in context of the upcoming policy, youre going to say no its not as if there was a proper clarification, dont read this statement. But it is the first time they have issued a clarification of that, and so careful to micro manage markets, i would be very surprising if they dont trying to mock that 50 bit percentage from 70 to 20 where it is now. I think they tried to do that, and i think they got it right. What did you make for janet yellen weighing in as well, was that designed to help . I dont think it was designed to help. I dont think so, but i do agree with her premise that she said the u. S. Is not an island. Have you ever been to frankfort, what happens in frankfort does stay in frankpofort, the dislocation there. New slogan. This inflation. Again, we do believe they will cut not just once, twice, probably three times this year, but probably not this meaning but again, it could happen certainly could be 50. The market is get up to be disappointed. It is what youre going to see is one to possibly three decents. When theres a 20 chance, and they dont do 50 youre set up to fix the market. Were running out of time, big selloff in sterling today. Whats the likelihood or a no deal brexit. Its going ton oddly brexit, either there will probably be elections before any risk of dissolving brexit. In terms of impact on the Global Economy and the u. S. , i think its relative live small but it will definitely add to this whole problem were seeing from the global side on trade policy and this will be the addition that will influence the u. S. And global sentiment. Thagreat to see you, bud. We will break down to see what lift says will happen to the dough if the fed cuts rates. Can you do more with less . Can you raise the bar while reducing your footprint . For our 100 years weve been answering the questions of today to meet the energy needs of tomorrow. Southern Company Welcome back, shares of beyond meat taking a big low lets get back, to aditi a Public Offering. A secondary release came from the company just moments ago announcing a secondary Public Offering of three and a quarter million shares this is a significant increase of the companys flow. Theres been a lot of talk about the relatively small float of a companys shares shares are down right now about 9 on the news it will be interesting to see how this impacts the short sellers we have been talking a lot about the heightened Short Interest in the stock. Back to you guys. Thank you so much 3 million, and 250,000 shares issued is about 675 million worth of shares at the closing price, today, mike, 14 billion market cap give context to this given the run up, you cant blame them. This is an efficient way to do it. I was talking about the lock up before theres anticipation and a lot of stock about to hit the market this isnt that much. It does change the math. Relative to the number of chairs that have been freely trained. This stock trains it entire float on a given kay clearly its been handed around at hyperer speed like its a video game so this could influence just that dynamic i wonder if it could limit the upside on the name there was bullishness. Which in theory over time could make it more appealing to Institutional Investors n. Shortterm, if there is this massive mechanical, you know, short screens at all times, it costs 100 percent of the stocks prices thats a massive interference. So that stock is trading off 12 hours up a little bit after the earnings, which were on the top line miss. 300 Revenue Growth. 303 Revenue Growth upgraded slightly, 4Year Revenue Guidance but of course have been trading incredibly well. Time for a cbnb news update sue her ra herera has it for us. Scotland should hold a visit on independence from the uk. If britain leaves the european impro yoik she spoke after talks in ed edenboro, with boris johnson. I also made it clear to him that the people of scotland will be able to choose their own future. Illinoiss governor, j. B. Prits d pritzker signed a new law giving relief from the cycle of high interest debt, lowers the post judgment Interest Rate from 9 to 5 , and narrows the window of opportunity for a Debt Collection tor collecto to cash in on a judgment look at that, a gadget filled car used in the james bond movie, gold finger and thunder ball will be auctioned off in midaugust. Expects thes asten martin to sell. Most of those gadgets, clearly the machine gun is not fully working. Lets hope not. I love the rest of it. St it fantastic. Its fantastic. I think their estimate is low because of all the gadgets its iconic. What is it, between four and 6 million . I think that sounds low and it literally could work in the city it would be fine. Alas, its too high for me. I think it might go for higher sue, thank you. You got it. Over to mike santoli well continue to talk about weather, what the fed is going to do on wednesday, priced into the market current numbers on the Dow Jones Industrial average and tendencies both before and after the initial rate cut in a cycle. This goes back, you know, back to the 1920s, so its pretty comprehensive and heres what you see the divergence in performance, a before and after rate hike. Whether theres a recession involved or not. You dont know in advance, here in green is the current experience o. 12 months ahead of this week. Its exactly on the average in terms of the overall change in the dow. Of course, it took an odd path to get there, a 20 decline almost in the 4th quarter. A rebound. Its left us right at this point. If it follows the pattern of a first rate cut without a recession, then you have this good news continued rally of more than 20 after the cut. If not, you actually tend to see gains after 12 months on average. Usually you have had a lot of weakness going into that cant say this is necessarily a guarantee of how it goes i really doubt theres an initial rate cut as well transferred as this one. We have Different Communications now, but its worth noting that its not so strange for the stock market to have done fine in the previous 12 months before the fed cut. And i guess that tina point is probably unique this time around because coming into the first hike you wouldnt have yields so low already in the bull market. Not typically, although after world war ii, yields were suppressed for a long long time. 50s is a time you might have had something similar. All the stimulus and bloated Balance Sheets. You had treasury yield suppress below where inflation was. All right up next, well see what happens tomorrow, wednesday, up next, beyond meat plunging after announcing a new secondary Stock Offering find out how that will Impact Investor appetite. Its been a record year for disney at the box office, thanks to smash hits like avengers and lion king, and the media giant lbrk atowfoyo busters to come wel eath dn r u coming up. Welcome back, weve got an earnings alert the steel maker is up 2 after hours, the company reporting gap eps of 0. 21 per share, up 0. 18 from q2 a year ago. Versus the estimate of 174 billion, its been a tough year for the steel maker. The stock is down more than 50 from a year ago. But again, up 2 pn. 3 in after hours. Rahel, thank you. Beyond meats shares plunging as the quarterly call just getting started. Offering a second offering of 3 million shares at the close today. Lets bring in kate cox, editor at new food economy and thomas george, president of Research Firm grizzle to discuss this whats your take on this is this increase in the float going to be a good thing or a bad thing for the company . I think its a good thing what were looking at now is growth, cost of doing business, were looking at growth. The stocks have surged over the last 180 days, but it costs none to scale, so i think were looking at a company that is evolving, that is growing and that can tell us something about the larger food landscape. Some of the Growth Numbers are eye popping, the restaurant and Food Service Revenue up, the retail, up 200 , combined growth of 300 Revenue Growth on the question of sustainability, how many more restaurants and food Service Players can they sign up, and how much more Retail Business can they do . Lets ask them. Thats a great question. You know, they have expanded capacity to meet this kind of demand over the last couple of months, but who knows whether they will be able to take on a huge partner, for instance, a mcdonalds or a big name in the fast casual sector food service, i think they can handle retail, i think they can handle right now. Thomas, do you think this decision to do a secondary offering, excuse me, is a suggestion that the company itself thinks its stock is well priced at the moment. Whatever you do, you want to do it at the best interest for the company. They have done that. Its the right price point from our perspective the command is clearly there their numbers are out of the park, right, so this is the time you do it. Your price target, thomas, is based on estimates to 2030 is that right . How have you predicted what sales will be in 2030 . So this is a stock right now, youre looking at plant based food where the penetration is. 25 , the classic wall street, dog and pony, doesnt fit the mold for a company thats growing nearly 300 revenue year over year, and struggling to find any company of this size that can do that kind of revenue. Think big picture, youre thinking like a vc, whats this landscape going to look like, and what kind of market share could it take out in 2030. Youve got bigger losses, mike, and does that factor in or you ignore it . Theres obviously a level of scale theyll be able to make money at it. Its a question of just exactly, theyre making a product or distributing a product t its not server farms. Its not a Virtual Network obviously the Food Industry in general does not have massive Profit Margins that a young innovative competitor can feast on and undercut. Thats the big thing, and the other thing, you can try to estimate the size of the overall market, and thats i think the basis for a lot of these projections and you can maybe decide, you know, exactly what trajectory its going to go. Is it going like plant based milks, what you cant know is how many competitors are going to be fighting over that, and you know, its a really good point, and from our perspective, we think this goes like nutella. There are a lot of other competitors to nutella but really only one nutella. From our perspective, i think there will be three or four Major Players in the space it will be a branded market and the narcotic share will be split among those players. Im with you on the nutella i totally agree with that point. Theyre going to be using the money they get from this offering to increase marketing and promotion, and manufacturing capability where are they on meeting the demand you seem to suggest theyre improving it are they up to the challenge for sure. They certainly would say yes, but i think its why were seeing regional rollouts of products like the beyond sausage sandwich that they launched with dunkin they did it in 190 stores in manhattan. Thats a good conservative start to see if they can get a product like that in a democratized chain store like Dunkin Donuts. I dont think anybody is in the habit of saying were not up to it it will be interesting to watch the next year or so where they go. Kate cox, thomas george, thank you both for joining us. Up next, Apple Earnings on deck, the tech giant gearing up for results tomorrow after the bell a preview of what is expected straight ahead. And coming up on fast money, coming down to the fed meeting, bankf erato oamics p strategists will tell us what to expect what do advisors look for in an etf . I tell clients, etfs can follow an index, but which ones target your goals . Its not about quantity. Its about quality. No trendy stuff. I want etfs backed by research. Is it built for the longterm . My reputation depends on it. Flexshares etfs are designed and managed around investor objectives. So you can advise with confidence. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Go to flexshares. Com for a prospectus containing this information. Read it carefully. Or trips to mars. 4. 95. Delivery drones or the latest phones. 4. 95. No matter what you trade, at fidelity its just 4. 95 per online u. S. Equity trade. Has been excellent. They really appreciate the military family and it really shows. With all that usaa offers why go with anybody else . We know their rates are good, we know that theyre always going to take care of us. It was an instant savings and i should have changed a long time ago. It was funny because when we would call another insurance company, hey would say oh we cant beat usaa were the webber family. Were the tenneys were the hayles, and were usaa members for life. Get your usaa Auto Insurance quote today. Apple reporting Third Quarter earnings tomorrow, beating estimates in the first two quarters but did see a slump in iphone sales. Joining us to talk about what we can talk about tomorrow, james wing, analyst at ark invek what will be the keys for whether this can continue . I think people are going to look for a reliable iphone but most importantly, the Services Segment thats where management is guiding analysts on how to think about the Company Going forward. They redid the whole disclosure around hardware and services only, and we want to see sustained growth and maybe some margin improvements for services. When that happened, what sort of total revenue to get to for analysts to correctly reward that part of the growth . Whats interesting is its not just about revenues, its about gross profit last quarter they had this interesting disclosure, service is 20 of revenues but a third of gross profits when Something Like that happens, were already at the point where people are doing the parse valuations a much higher multiple than usual. One of the points that i think youre hitting on is that longer term, apples position in health monitors, smart watches, devices, things like that, might be more important than the iphone why would that be . If you think about how the iphone succeeded, the initial point of distribution, were at t, tmobile, and they helped distribute the iphones to get subsidies so people could buy them without the sticker shock of oh, my god, im buying a thousand dollars on an iphone. When we think about the watch were starting to see that happen, the subsidy and point of distribution are now the insurance companies, etna and united,these companies are striking deals with apple to provide subsidies for the watch, so the watch could be cheaper from a perceived sticker price, and could be a central item because it actually prevents health issues. Clearly services have been the bright spot. Thats where the double digit growth isme youve got slowing iphone growth, the currency impact, is the stock price for perfection now that weve seen what is it, 30 plus run up so far this career i think near term, the price is pretty reasonable for people with a shortterm view on the stock. I think its important to think about, you know, why do you own Something Like this. You could try to trade around the controversy but for apple, i think the Bigger Picture is theyre becoming, as they approach a billion people, last time was like 800 million or so, this is becoming a company that is a content and Software Distribution platform, and i dont think people truly appreciate the magnitude of that power. What kind of valuation should it get i think it could easily be worth twice what its worth right now, if you think about the markets its entering, right. That set on the numbers of the content distribution platform, is there an execution risk on that versus say a disney plus where we know this is their bread and butter to deliver great content. Im glad you recognize disney plus that plays into apple strategy apple doesnt have to do all the heavy lifting. Theyre doing first party content. If youre look at whats going to happen in media, streaming tv media over the next five years, all these platforms, whether its disney, theyre going to have to come online. Netflix is eating their lunch. When they come online, they have to go through the apples app store, apple collects 15 to 30 revenue cut to all of these companies. You think back to the 90s, microsoft was extremely successful but they did not collect adobes revenues, in a uniquely powerful position, collecting revenue from music, gaming and tv. Thanks for joining us, a very positive, bullish perspective on apple. Up next, whats old is new at the movie theater. Disney breaking a Big Box Office record over the weekend. Weve got the details of that. And a 3 million payday. Fort nites world cufilsp na wrapping up over the weekend and one teenager scored in a very big way. Well explain next its been a blockbuster year at the box office for disney setting the record for the highest grossing year and its only july. Weve seen it in the stock price today. Disneys roughly 7. 7 billion in worldwide ticket sales is the most a studio has grossed in a year and as you mentioned were only 7 months in this comes as the lion king closes in on a billion dollars at the Worldwide Box Office giving disney the five biggest films of the year. And disneys dominance is set to continued with frozen two coming out in september and star wars the rise of skywalker in december well have to see how disney uses its Box Office Success to drive subscribers to its streaming service. Im playing devils advocate a little bit here but to what extent is this years success based on sequels or remakes which its limited ability to do it in the years ahead. Youre right this is based on franchises around disney going around decades if you look at films like the lion king as well as the marvel business. But i would say what disney has done well is shown that it can take characters relatively unfamiliar, such as iron man and turn that lesser known character into a worldwide franchise so disney has proven the ability to mine that content so i wouldnt say that theyve tapped out just yet, if you know what i mean. Fair enough, julia, thank you very much. The fortnite world cup finals wrapped up this weekend with the first ever solo champion taking home 3 million. Josh lipton has more on that meet the best Fortnite Player of the planet, kyle kiersdorf, a 16yearold from pennsylvania. He won the first ever fortnite world cup and the 3 million you just mentioned, that is the largest single payout in esports history. Then event taking place at Arthur Ashe Stadium in new york city 59,000 tickets sold, almost 10 million views on you tube on the final day of competition fortnite we know is a force, boasts more than 250 million players and almost 4 billion in estimated revenue. Sarah, back to you were these just ordinary teenagers or well known people in the fortnite world . Well, so you had a number of qualifying events around the world. Millions and millions of people tried to qualify at the end of the day, a few hundred did. It came down to these guys when you look at him, thats a pro, he may be 16 years old but hes a professional gamer. He plays for an Esports Organization located out in los angeles. 3 million is not going to help parents tell their kids that they shouldnt be paying quite so much. Exactly maybe they shouldnt push back so much against it i dont know well not everybody can do that. I can still argue against. Can argue against everything. Mario gabelli will be available to discuss his media outlook tomorrow at 12 00 on halftime report. We have a report on cognex. Down almost 11 in after hours weak q 3 revenue guidance. This is a company that manufactures bar code scanners and other equipment. The company reporting their outlook has worsened due to Business Conditions in europe and asia and saying they saw softness in the two largest markets, automotives and consumer electronics. That stock down almost 11 we have a look at the key Earnings Report every investor needs to know about when closing bell comes back. Can i get some help. Watch his head. Im so happy. Whatever they went through, they went through together. Welcome guys. Life well planned. See what a Raymond James Financial Advisor can do for you. You should be mad that this is your daily commute. You should be mad at people who forget theyre in public. And you should be mad at simple things that are unnecessarily complicated. But youre not mad, because youre trading with e trade, which isnt complicated. Their app makes trading quick and simple so you can strike when the time is right. Dont get mad, get e trade and start trading today. 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The company posting a wider than expected loss for the Second Quarter. But posting a big beat on sales. Just highlights from the Conference Call going on the ceo saying they achieved distribution across 53,000 points of sales worldwide up from 30,000 at the time of the i. P. O. Its the secondary offering which sort of adds more shares on the market. 10 down after 800 up. Not much time for a look ahead. China and png reporting. Lets start with a reporting of yum china. How does yum china fair as trade tensions drag on, thats the question last quarters comps a came in at 4 . This quarter analysts are looking for 39 cents on revenues of 2. 6 billion. For what its worth, starbucks Strong Performance in china may be an indication that American Brands are not in trouble in china so far yum china that stuck up 25 so far year to date. P g reporting tomorrow. You have like four Companies Reporting tomorrow. P g is the doubt the other companies are going to get hurt. High stakes for cincinnatis consumer giant, its up. Watch growth this is the key. P g capping off a 4 organic revenue year thats the best its seen in years can that continue . Well get the 2020 fiscal outlook and see if that momentum keeps up the comes get tougher. Beauty has been the bright spot in the portfolio the skin care killing it with double digit growth in asia. It shows the asian Luxury Consumer is buying despite the economic slow down well be watching the grooming part of the business, thats the weaker spot lately trying to cut prices and match Services Also the new controversial ads creating some buzz but p g is in a sweet spot right now when it comes to growth. Its upending the whole category dow higher today, s p slightly lower all eyes on the fed. Meeting starts tomorrow, decision on wednesday. We are out of time that does it for closing bell. Fast money begins right now. Live from the markets overlooking new york city time square, im melissa bell a beyond meat down shares down after results reporting. Also ahead, two names to buy, two to sell as we kick off the busiest earnings week of the season later food for thought the one part of the market Goldman Sachs is bullish on