Half a dozen fed officials speaking today as the growing rate debate simmers. Speaking of the fed, two perfect guests, both officials who served on the fom, Sarah Bloom Raskin, coming up before the close today. Joining us final hour of trade, josh, nice to see you. Happy to be back, sara. 212 point rally here. Are you buying into it i think whats interesting, the answer is yes. I think whats interesting weve done nothing, given headlines, back to early august, essentially flat im not suggesting thats a bad thing. In fact, bulls would say look how much is thrown at the market in the form of tweets and deals and nondeals and fed volatility. In the meantime, yields havent even stabilized. Yet were still hanging in at these levels i think whats important, give the edge to the bulls. Weve been testing resistance in this range the upper side of this range, more than weve been testing support. So slight edge to the bulls. You look at xly, xlk combined sam will probably correct me, probably 30 of the market at this point the most important sectors, consumer, tech, and they look like they want to bust higher. Thats where i am, where my head is at. Coming up in a moment, lets focus on the big stories we are watching today seema mody covering the rally and protests out of hong kong, details on the beige book out this afternoon ill take a look at fresh comments from fed officials. Wilbur with the latest on brexit chaos. Cortney watching Market Movers and mark has the dashboard seema mody, to you overseas. Positive sentiment started in asia after carrie lam with drew controversial extradition bill that sparked months of protests in hong kong shares gaining 3 , best day since 2015 the market took it as a sign china is potentially giving in activity in chinas services sector, pick up slightly in august while one datapoint does not make a tren its an encouraging sign growth sectors, oil higher, oil prices up 3 after new u. S. Sanctions were imposed on iran this morning them there are a number of stocks hitting new highs today cocacola, pepsi at an alltime high walmart and Lockheed Martin down. Thank you Federal Reserve releasing beige book ylan mui has that. Reporter no change if the beige book still finding the economy is expanding at a modest pace employment, wage and price increases, feds found those were up modestly as well. A lot of color in the beige book over whats happening in manufacturing given trade tensions overall the fed found Manufacturing Activity was down slightly across the country. About half of the 12 fed strikts report add slow disoow slowdown regions found Manufacturing Activity picked up, guys still a mixed picture geographically back to you. We heard from a number of fed speakers, katherine bullard, Neel Kashkari and Charlie Evans any minute mixed messages out of the fed. New york, john williams, perhaps the one to watch, a bit of an ambiguous statement but pointing to be in the cut camp. Speaking of trying to get the message out, former new york president , new york fed president bill dudley with another oped attempting to dispel some of the controversy of last week writing he does not think the fed should attempt to influence the elections, but, quote, a lot of risk that the fed by easing might encourage the president to take even more aggressive actions on trade. This might create even greater Downside Risk for the economy. We also in the last 24 hours, guys, heard from bullard in st. Louis, Voting Members, 50 basis points, responding to market pressures in the environment yield. Other side, another fed Voting Member says the economy is doing just fine. Here we are in another big rate debate where the market is pricing at 100 chance of 25 basis point cut in september though 50 might be a surprise. Josh, do you think this is key to keep the market propped up this central bank and others getting that dovishness. I dont know what it was for the economy to Lower Borrowing rates in an environment, you know, corporate cap ex peaked in the Third Quarter of 2018. If you keep the uncertainty of the trade war, i really dont care what you do with fed funds rates, youre not going to change the picture for corporate spending and investment. Youre just not. I think we kind of have two economic situations. I think we have the classical one where we look at things like new truck orders and railroad loads and things that really have not been profitable to look at for anyone over the last 10 years. Put that to one side then theres the other economy, which is whats happening at walmart, target, amazon, back to school sales, whats happening with consumers paying netflix, soon going to pay disney that part of the economy, the latter part, if you focused on that youve made money in stocks and so we have to decide at some point will these two things remain separate or will one ultimately influence the other oldtimers will say sooner or later if auto sales fall home sales fall and everything goes with it. Maybe thats true. Theres so much unprecedented activity on a lot of front, its hard to be sure. I wonder whether its an issue for the market theres such great descent inside fomc it is a little bit harder to figure out how many rate hikes were going to get beyond september, if thats a guarantee, given theres such distinct opinions how far you have to get ahead of it. Think about, go back a year consensus for three rate hikes this year. Now were saying is there two or threeway cuts think about what a 180 that is i dont know that its ever easier than it is now or harder than it is now i think the point you make about the the key takeaway, mixed messages again for the first time in a while. Joining us to talk about the fed later in the show. Meantime watching brexit uk Prime MinisterBoris Johnson suffered a torrid 24 hours, just suffered another key losing vote this one mps vote to block no deal brexit. The bill now goes to the house of lords rather than sit and allow his hands to be tied on brexit, Prime Minister johnson tabled a snap election on the 15th. That will be voted on imminently this requires a twothirds majority to be approved. Despite opponents calling for change in recent months and often specifically before an election, the Prime Minister expected to be defeated again this evening being denied his chance for an election that said, as weve been on air, jeremy corbyn, the leader of the opposition has said he would support an election once this antino deal brexit bill has formally become law. That could be friday or monday at the moment it looks like tonight Prime MinisterBoris Johnson wont be granted an election later this week or early next week he might well be given that chance. Whats the pound reacting to positively isnt the prospect of a corbin leadership just as potentially worrisome as no deal brexit . Yes but all thats happened in the last 24 hours has been antino deal part of this whole bargain has gone through the election part has not gone through. So for risk assets youve had the positive part. You havent potentially had the uncertainty of a fourweek Election Campaign confirmed. And with that, theres a slight nuance on this, what corbin basically said he wont approve the election unless that law to seek an extension and prevent no deal has already become law. Complications about whether if youve got a new Prime MinisterBoris Johnson with the majority being done either way up over a percent 122 not pound back to prebrexit level. Yesterday was a terrible day. Turning to retail, a number of companies speaking out at retail conference Courtney Reagan joins us with more hi, courtney. Hi, sara. A lot believe the consumer is strong there is uncertainty around tariffs, of course, but many are managing through Ceo Marvin Ellison says broader economic environment is supportive Discretionary Holding up well. No evidence so far theres any trade down even and some of those big ticket items Dicks Sporting Goods ceo ed stack said he and his vendors used their negotiation power as well as their buying prowess to do a pretty good job mitigating tariffs. Therefore, theres going to be relatively few price increases Williams Sonoma ceo laura al better saalber said in the areas they counterraise prices they have more four than they thought. Patrick gris merced u. S. Environment is supportive and helping his business even though the company lowered the forecast for the year disappointing the street back to you. Thanks very much. Starbucks is not the only company revising forecast, jetblue and tyson in the last 24 hours also lets get to mike santoli for the first market dashboard mike. Im calling this fighting ebb tide, fighting Economic Growth global is causing downgraded expectation for earnings also get to more aquatic maritime themes diving into the shadows people betting on more down sides than there was in stocks looking at countering crosscurrents, important levels in the stock market that josh was alluding to before and bobbing to the surface to bond market stories lets look at the relationship between macro indicators forecast ism, got that print below 50 you see here the relationship between ism Manufacturing Index and how many what percentage of forecast revived up or down thats the rollover were seeing right here the percentage is down toward 40 . That is out of rbc we suggest perhaps the direction of revision is still going to be lower until ism turns as it did here, multiple places. Lets look at Morgan Stanleys leadings earnings indicator, using macro variables. Trend for realized Earnings Growth going towards zero. This is clear that probably were going to see pressure on the earnings outlook the question i would have is whether the market has already figured this out if you look at global exposed companies, cyclical, stocks have already been punished. The big question is maybe weve already gotten here in terms of pricing and accounting for this coming week. Mike, thank you very much were going to continue along that topic chief investment strategist. Sam, earnings recession, where do you stand on that, likely or unlikely unlikely right now. The beginning of the year there was that concern because we had forecast for two successive quarters of earnings declines that the definition of an earnings recession also what you find is that 75 of economic recessions since world war ii were preceded by earnings recessions. Now that we got better than expected results in the First Quarter and the second quarter, Third Quarter is expected to be off by 3. 3 but then were going to be up 3. 8 in the fourth quarter. Taking the earnings recession off the table. So youve got in terms of guidance cuts and risk the companies are citing tariffs, the u. S. Dollar. What else are you hearing out there and where do those two rank in terms of how painful they are going to be i think what were finding is people just dont know for sure. Thats why were seeing 10 of 11 sectors that are expecting earnings short falls compared with their june 30th estimates and all 11 sectors are now posting earnings expectations that are lower than what was foreseen in june for the fourth quarter. So people are really being conservative by racheting down their expectations but i dont think they are going far enough to say were headed for an earnings recession. I want to switch gears and ask you the question Everyone Wants your take on forgive me, i dont know if youve released your take on this yet prior to now. Talking about an indexing bubble and passive investing mania, which strikes me as odd. The whole idea of indexing and passive investing is humility and people saying i cant beat the market its almost the opposite of a mania. People just being realistic. Then the money moves almost from the same portfolio, from a closet indexer charging 80 basis points, ishares essentially for free, but the same holdings. How could this be a bubble why would this be a mania we need to worry about . What are your thoughts on this idea. My thoughts are maybe whats happening is youre having so many investors pile into the megacap stocks, a small component of those stocks are whats driving the Overall Index to the point where when we do eventually falling into a meaningful bear market, its very top heavy and dragged down, similar to what we saw in 2000 while the large caps down 10 , small and mid caps were up for that year. 2001 large and midst down but small caps in positive territory. Isnt it true following that thread, every bull market led by a somewhat narrow group of what we call leadership stocks, whether nifty 50 in the 60s or do t dotc dotcomes. Thats normal. The premise of this argument is sits boosting megacap stocks because the indexes are cap weighted, not equally weighted some of the etfs more fact orbased are more equally rated. Guys, hang on for just a second i want to go to steve liesman. Weve got breaking news on the fed. Steve at headquarters. Steve. Reporter sara, thanks very much chicago fed chairman Charles Evans making stronger criticism of the policy, trade tariffs with immigration restrictions could grow trend u. S. Growth for the longterm. He said trend u. S. Growth could be closer to 1 1 2 compared to 1 3 4 or lower because of such policies trade polls increase uncertainty nearterm effects among the Business Community longer term you have tariffs in place, competition, reduce productivity, motivation for firms to innovate. It points out restrictions on Legal Immigration could reduce labor hours. Two key components for determining gdp Growth International trade, he says, expands Economic Opportunity so sara, theres somebody from the fed who is giving the economic case for having open and free trade. So hes a Voting Member right now, correct, steve . I believe so, yes. Is he a cutter, in the cutting camp as well he wants to cut rates charlie has been worried about inflation and also very sensitive to the weaker Economic Data out there you know being in the chicago district, he by the way giving a speech at an auto conference hes going to be sensitive to manufacturing in the auto sector a key component, midwest component, midwest Manufacturing Index that showed some weakness still over the last several months. Okay. Steve, thanks very much. More fed discussion to come as we mentioned earlier just to come back to the earnings discussion. Josh, when you see those warnings, likes of starbucks meant to be an area of strength, consumer exposed company, does it concern you i think there are idiosyncrasies for Companies Like starbucks depending what quarter it is and what the comps were a year before might change what they are saying, where its not necessarily something you could extrapolate and say this is true of every consumer facing company. I want to be really careful. Even a company as big and meaningful as starbucks is not always a message i would love to hear what your thoughts are of the concept of an earnings recession because we had one in 2015 and 2016 it was mostly driven by Falling Oil Prices we came out on the other side okay market was flat a few months and then made a new high. Came out okay, down almost 15 through february of 2016 and the problem was what happened was analysts all of a sudden woke up and said, wait a minute, its not an earnings recession, its energys fault. Take out energy and its up 7 1 2 were looking for a scapegoat like that this time around. Trade. Guys, thanks very much. Still ahead on closing bell, well speak with former fed chairman sar, ah bloom raskin and fed headlines a week or so. Dive into googles fined from ftc and changes it could spawn at youtube as we head to break, check on data tracker, deficit narrowing in july as exports climb as the trade gap with china rose to its highest velel in six months. Closing bell will be right back. Dow up 220 ah, you could say that. So how are things with you guys . Great. Thank you. Thank you, sir. Lunch next week . Terrific. Say hi to the team. Will do. Call my office, i will. Sounds good. Alrighty. Servicenow. Works for you. Landmark ftc find today. The company agreed it pay 170 million to settle violations of childrens privacy laws. Julia boorstin with what it entails. Julia. Agreed to changes to protect privacy. They will require to flag kids content. Youtube wont be able to collect data to track kids for ad targeting and kids wont be able to comment on videos without parents consent two commissioner at the ftc accide dissented saying it doesnt go far enough as far as the fine and fundamentally changing business practices, also saying googles commitments cant be easily enforced. Analysts tell us it wont impact parent alphabet bottom line is a rounding error for the tech giant. Guys, back to you. Julia, thank you. A continued pile on on google. Im a shareholder they got these guys dead to rights its not like they were being malicious about it if you have kids and you see them consuming youtube, it just plays and plays and plays and plays and they have information on kids viewing habit probably more collected than you would think. Oh, my gosh do you know how many times ive gone for tooubs, baby shark and wheels on the bus, a 45minute loop. What i dont get is how they are going to be able to change their behavior to scrap all targeted ad. Do you n how smart these people are facebook, too. They will find every work around, every loophole new ways of doing things under the sun. They will always be two or three steps ahead of everyone else. 100 million fine, nothing. Cost of doing business. Expected they have reserves for this. A it will. Yu. Still ahead lyft facing a new lawsuit over Sexual Assault complaints against its drivers. Slack First Quarterly results since its gone public. Josh brown bullish even before the listing. He was bullish you cant hear him. Sound over tape. Roll the tape i really like slack. Im josh brown. All you need to know. He still is. Back in a couple minutes stand up if you are First Generation College student. 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. So, every day, we put our latest technology and unrivaled network to work. The United StatesPostal Service makes more ecommerce deliveries to homes than anyone else in the country. Doprevagen is the number oneild mempharmacistrecommendeding . Memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. Welcome back to closing bell time for word on the street. Initiating wwe outperform with 90 price target firm citing attractive Business Model saying the company is on the brink of a period of unprecedented growth i like the debate as to whether this is a sport or entertainment. Its valued like its a sport. Yeah. The live attraction that comes with it. Behmo Capital Markets upgrading Activision Blizzard raising price target to 60 from 43 a share. The firm citing stronger conviction in the companys restructuring and investments in call of duty and warcraft. And mizuho on micron raising from 50 from 44. Chip pricing better than expectations chips are having a great day, josh they have been an interesting indicator on the market around trade. However volatile the chips are, micron is like doubly so. Its one of the highest beta names in the market. Stock is up 9 over the last four sessions. If you really feel like i have to get into this right now, maybe your best bet is to focus on position sizing maybe you dont have to have a full position at these levels if you really feel youve missed out and theres going to be more to come. If you look at a twoyear stock, its in the middle of nowhere. It tends to have really wild moves around announcements like these but its not, you know, the type of rally that typically sustains itself over months. Is Pro Wrestling a sport . Did we settle that. The analysis geeuys and girls. Analysis saying its not an actual sport but valued like one and getting life viewership like it is one, key thing for the stock prices. If i say to you here is a million dollars, you have to invest in the future of one of these two sports over the next 20 years, baseball or professional previouslyiwrestlih would you choose professional wrestling. Knowing the demographics of each and the speed with which one operates versus the other. The success on tv. Weve been invited a number of times. Were kind of a wwe show. I went to barclays for summer slam with my kid ive never seen as rabid a live fan base never. These people are beyond into it. Id rather bet on that what would be your wrestling name, josh i think i already have one, downtown josh brown. There you go. Man frost 31 minutes left of trade 221 higher on the dow. The key things driving the action, a global rally led by hong kong as we see a step solving political crisis small step brexit, crucial vote expected in the next hour whether to hold a snap general election. Beige book just out and half dozen fed officials speak today as growing rate debate simmers continuously time now for cnbc update with sue herera sue. Hi, will, everyone. Here is whats happening at there hour the Bahamas National airport was completely destroyed by Hurricane Dorian entire plaenes and parts of aircraft lie scattered on the ground all the buildings on the premises were severely damaged and now the carolinas are in the crosshairs of dorian as it heads up the east coast. Wcau meteorologist crystal cli has the latest on the track. Sue, were still looking at a forecast that includes 105 miles an hour, category 2 storm moving north northwest at 9 miles an hour tonight it will push directly to the north. Tomorrow morning things will get most interesting and will be on high alert as it starts to make northeast turn still at a category 2 passing very close to areas like savannah and charleston and then riding through friday morning very close to the North Carolina coast. Thats when a landfall is possible as of the latest update from the National Hurricane center regardless whether we see an actual landfall, talking areas where well see inland flooding, rain up to 15 possible storm surge 4 to 8 feet thats the latest, sue. Thank you, krystal. Speaking of that roy cooper is, indeed, warning the public about the threat of flash flooding and storm surge before dorians arrival tomorrow. Hurricane dorian has its sights set on North Carolina we will be ready, and we will not underestimate the damage this storm can cause North Carolina faces deadly storm surge and inland flooding. Were watching dorian that is the news update this hour i will send it downtown to you. Thank you looking at the dow up 232 or so, near session highs go to mike santoli, second dashboard. Mike. Calling this one diving into the shallows when you do that, expect theres more downside than there actually is. Take a look at this chart of s p 500 against Short Interest in the market this is from Merrill Lynch the bottom panel is percentage of shares sold short as a proportion of overall shares outstanding. Here is what you see, this blip higher in the last couple of months it shows you professional investors got a little negative, looking nor more downside. Weve seen these lips get extended, 2015 and 2016, deeper correction, this is coming off bear market in 2008, 2009. What this does is fit in with a general picture of being cautious to defensive to skeptical about this market despite the fact it was only a 6 pullback in stocks. I think the picture argues for net bullish outcome if, in fact, we dont get some other kind of a shock. Sentiment is the bulls friend to a modest degree and this supports that. Interesting authentication Powerhouse PanelSarah Bloom Raskin and Narayana Kocherlakota to weigh in on all fed speakers and what the central bank should do next. Ive been a caregiver for 20 years. No two patients are the same. Predicting the next step for them can be challenging. Today were using the ibm cloud to run new analytics tools that help us better predict and plan a patients recovery. Ultimately, its helping thousands of patients return home. President trump making fresh comments on china. Get to eamon javers for details. The president was asked in an unrelated event about whether hes concerned about the chinese trying to hurt the economy by going after u. S. Debt. Here is how he responded. Im not worried about it at all. They have approximately a trillion dollars thats a trickle compared to what we do plus Interest Rates are very low weve never been at a position where weve had more people wanting to invest in our bonds if they didnt want to renew or reup, as they say on wall street, that would be fine with us because we can refinance that very easily. Theres never been a more time where more money has come into our country. The president there is saying hes unconcerned ultimately about the chinese selling u. S. Debt the reason, he says, is because theres enough demand global to make up for chinese buyers the president weighing in on the treasury market. Not something you hear very often. In the context of the trade war with chinese could it spill out of the tit for tat on tariffs and turn into something more broad, economy to economy. The president seems unconcerned about a broader spillover. Thank you. You bet. Former new york fed president bill dudley out with another oped today clarifying his oped from last week when he created quite a controversy saying the fed out to abandon its apolitical stance and consider how the president s reelection could present a threat to the u. S. And Global Economy amid ongoing trade tensions in todays piece dudley said the fed should push back to encourage better policy and not stand by and allow a recession former fed chairman sarah raskin and minneapolis chairman Narayana Kocherlakota. Maybe struggling to articulate, even fed chair powell wrestling with this idea, what should the fed do about the trade war what do you think . So bill dudley has come out with a new statement his initial statement was a bit problematic. The initial statement suggested to many that the fed would actually act in a political way. That was how it was interpreted. That was a misinterpretation that was essentially what bill dudley is now trying to reel back why was it a problem, sara part of the rope it was a problem it was interpreted as actually creating the impression the fed does take politics into account, the fed does act politically. This, of course, had all kinds of negative collateral potential damage associated with it, such as a call by some for hearings on the Senate BankingCommittee Regarding whether there should, in fact, be a fed that is so politicized. That was the furthest thing from what bill dudley, i think intended and certainly what he intended for the feds. Hes new come out with a new statement in which he tries to clarify, put into a better context what he meant by his initial comments. Im not so sure hes dialed back that much, though a key line for me, he says, quote, the fed this is in his new article, clarification article, the fed needs to be cautious it does not inadvertently enable the president s trade war with china. Thats still not the feds role, is it . Yeah. Thanks for having me on. I felt that bills dialback didnt dial back as much as i would have liked i think the fed itself, its very important to realize that like myself and my former colleague sarah raskin, were former fed people. The fed itself has been very clear it does not act politically in any way the way the fed thinks about the trade war, doesnt matter who generates the trade war, its completely element its one element of the forecast to take into account when thinking about the appropriate stance and policy. I think what dudley seems to be suggesting is you actually want to be taking into account who is generating that trade war and how you might influence that persons Decision Making that seems completely inappropriate for a tech technocratic institution. How should they think of the trade war. An economic drag on Economic Activity you see that in the Manufacturing Sector and you see it in markets. Theres a lot of concerns about Downside Risk in markets so i think the fed is doing the right thing, which is to ease in response to that then of course the big question is how much to ease. You know, i think were moving in the right direction along those lines. Sarah, in terms of latest data and fed speak weve had, whats your take on manufacturing pmis and whether well see the easing priced in by the market coming up later this month. I think youre right, will, that the latest Manufacturing Sector data was not good this the first downturn in Manufacturing Activity in the u. S. That we have seen since, i think, august 2008 it really is a slip here if you probe behind the data, behind the manufacturing data, you do see some cause for concern. You see that in the Manufacturing Sector, hiring isnt happening the way you might expect youll see in the Manufacturing Sector data that Business Investment isnt happening the way you might expect so were starting to really see the effect of the tariff war on the Manufacturing Sector so i would add to narayanas good answer from before. In addition to looking at what the markets are doing in response to this data, i think its important for fmoc to probe whats happening in the market sector, to see essentially whats going on in reaction to the trade tensions and determine the extent to which thats going to pool things down. Here is the issue that people are having right now ill pose it to you. Feels like fed is a bit unanchored right now Manufacturing Sector is a small component of our economy, consumer economy consumers in great shape the fed is not posed to respond to the markets or inverted yield curve. Its good they Pay Attention to everything and take it in but not be bullied by the market so what exactly is dictating the direction for the Federal Reserve path and are they communicating it clearly i think theres two key elements to dictating fed thinking one is inflation remains low there are concerns that Inflation Expectations are sliding downward those are around for a while the fed is taking those on board more recently. Then i think that the other concern is the closest effective zero lower bound i think thats what you see priced into markets is if there were Downside Risks, if whats going on in manufacturing were to spill over to the broader economy, does the fed have the tools to respond to that what we know from Economic Modeling and reasoning over the last 10 years and before that is given the closeness, the fed has to start moving earlier than it would move i said this in answer to other questions. If the fed was at 5 Percentage Points in terms of where Interest Rates were, you might not want to move right now given how close you are to zero bound you have to start moving now to keep the economies as close as possible. Another quick question, sarah, those that are critici criticizing bill dudley for those who came out against trade war, i wonder where the critics were during Obama Administration where you could argue Federal Reserve wasenabling deficits and stimulus by taking Interest Rates to zero and pumping the economy with quantitative easing its also tricky where its inevitably linked. Thats exactly right. I have to say from my days at the fmoc, and i think narayan, take might remember the same as i do, we did a really good job, i think, of screening out the noise coming from the white house or from the congress, at least in our time there was quite a bit of criticism regarding quantitative easing. It was a policy people were unsure of. There was a day when john boehner, the speaking of the house, sent a letter over to chairman bernanke and entire fmoc, on the day of fmoc meeting and said what youre about to do is going to damage the u. S. Economy. I recall it having zero effect i mean, we did, i would say, an excellent job of screening out the noise. I would also go so far as to say the level and intensity of the criticism coming from the white house this time is of a level of a character that is very, very unprecedented it is a level that i think is incomparable to other kinds of criticism that has come from the white house or congress in history. Good to have both your perspectives Sarah Bloom Raskin sorry, narayana, heading into the close, under 15 minutes. Well have you back soon Narayana Kocherlakota, minneapolis fed. A break in shares, bhox jumping on news, up 12 , talk to ceo aaron levie. Session highs, up 226 points on the dow. Excuse me, where is gate 87 . You should be mad at nonseasoned travelers. And they took my toothpaste away. And you should be mad at people who take unnecessary risks. How dare you, hes my emotional support snake. But youre not mad, because you have e trade, whose tech helps you understand the risk and reward potential on an options trade its a paste. Its not liquid or a gel. And even explore whatif scenarios. Wheres gate 87 . Dont get mad. Get e trade and start trading today. Through the at t network, edgetoedge intelligence gives you the power to see every corner of your growing business. From managing inventory. To detecting and preventing threats. To scaling up your production. Giving you a nice big edge over your competition. Thats the power of edgetoedge intelligence. Servicenow put our this changes everything. Youre right sir. Everything. No not everything, i mean youre still blatantly sucking up to me gary. Brilliantly observed, sir. Always three steps ahead. Six steps ahead. Sixteen. So many steps. You done . A million steps ahead. Servicenow. Works for you. Weve got news on twitter, following account hacks, julia, what can you tell us twitter finally giving us an update on whats going on after the apparent hack into an actresss account, chloe grace moretz after hacked into friday. Temporarily turning off ability to text message to protect peoples were taking the step because of vulnerabilities that need to be addressed by mobile carriers and reliance on having a linked phone numberer for fwo factor authentication were working on how to improve this well activate on markets that depend on sms or reliable communication, soon work on longer term strategy for this feature. Its unclear how many twitter users access this feature. Weve reached out to twitter on this despite negative headlines twitter shares up 2. 7 back over to you. Thank you very much ill pick it up. Josh, last chance trade. Youve gone four. You made a good call with twitter. No, right here and now, stock about to make a 52week high pennies away pennies away think about all the destruction youve seen in Technology Stocks coming out, if you think we just had market volatility this summer, coming out you want to hold names on the best, twitter above tenday, 50day, all those amplgs rising moving averages. The trend is your friend a new high i think 50 is reasonable. Thats almost 20 from these levels plenty of wall street analysts have targets even higher this company could be next year on a billion dollar quarterly revenue run rate almost nobody thought they would get here even as recently as between years ago. Stocks on fire has a better chart than any of the others i like it here and now i would be a buyer. Despite the hacks. The hacks are hilarious we love the hacks. Its part of the charm of the thing. Even the ceo gets hacked on twitter. Its great, amazing. About eight minutes to go before the closing bell. Here is whenofwhere we stand rally steady all day long, up 230 on the dow nr sseaseion highs. Well be right back with the closing countdown. At Southern New Hampshire university, we believe in education built for all people. [woman] snhu was the best experience of my life. [man] without snhu, i wouldnt be the leader i am today. [woman] i graduated high school 19 years ago. I still finished. [man] in the military, you feel that sense of accomplishment. Thats what snhu is. You will march from this arena and say to the world. I did it. [woman] you did it. I love you. [graduate] i love you too. You should be mad at leaf blowers. [beep] you should be mad your neighbor always wants to hang out. 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. Tesla moving lower this hour phil lebeau with details what do you know a report of deliveries in august in the United States are lower. You have to tell people to take this with a grain of salt for a couple of reasons. One, tesla sales deliveries are notoriously lumpy. Sometimes up one month, down the next month, especially as they increase deliveries to different reenls around the world. While there may be some credence and weve reached out to tesla for comments on this, may be some credence to this report, its not enough to extrapolate and say were seeing a dropoff in demand for model three and deliveries are going to slow down this is one report mentioned in the United States. Again, these deliveries by region can be lumpy month to month. Be cautious on this news. Phil doing a phoner fr im in buffalo. Great stuff hit with a new class action lawsuit, cnbc deirdre has details. The suit filed on behalf of 14 women alleges lyft is mishandling a sexual predator crisis failing to use its own technology to protect passengers and not doing enough to respond to reports of sexual abuse in a statement lyft says we do not tolerate violence or harassment and such behavior does result in a permanent ban from our service this is the latest example of how ride sharing, lyft and uber are curbing sexual abuse by drivers. Its also one of the many challenges they face as they struggle as new public companies. The attorney accusing lyft in a press Conference Today of putting profits first. Of course, profits are exactly what investors are looking for with the lack of them they are pushing uber and lyft to new record lows. Guys. Thanks. Well go back to mike santoli for the third dashboard of the session mike. The highs today just about in an interest area look at the chart of the last year of s p. This is the sixth time since early august weve approached 2940 area. Todays action will get us right up to that combined with a heavily trafficked area of volume. This is from fitzgerald, the amount of volume transacted in this zone in s p 500 futures is very heavy relative to other levels it shows you some significance if we can get above this level a lot of folks think we head back towards a run at highs. Of course if you stall out here, basically reinforce the idea markets range for a little while. Not a make or break level but interesting. Go to nasdaq where bertha has a closer look. Hey, bertha. Thanks very much. The tide is rising to keep with aquatic theme in terms of tech not huge volume but didnt have volume in selloff in the last 30 days chips are the big winners, moving us forward as far as the big cap names apple and facebook today are really providing a big lift both are just shy of moving below territory, the beat and raise on earnings hitting an alltime high with lam research once again among lagerts today, ultragenyx, good but some are concerned and starbucks lower. Over to seema. Hi, bertha, at the highs of the day, erasing losses with dow up 230 points. Stocks lower yesterday higher today, intel, walgreens, 3m, caterpillar, am. Another factor in play, weaker dollar small caps are getting a boost as are emargining markets. Part of emerges markets the development in hong kong overpass and also posting gains. Michaels better than expected earnings that stock is up nearly 12 on the day. Closing bell, dow up 230 points, s p 500 a gain of 30 welcome, everyone to closing bell. Im wilbur frost, mark santoli cnbc commentator, check with mark on the close 240 points high on the dow, shy of 1 , over 1 for s p which saw over half of the sectors up more than 1 , nasdaq up 1. 3 what stands out on top of that sara, as well. Oil very strong but dollar weak which helped certain sectors on the s p when we see a rebound in british euro. I would note broad strength in the rally, every sector higher, 11 out of 11 technology, communication services, energy, industrials, materials, financials on top thats what you want to see if youre bullish, cyclical rebound. The question is more than just today. Yesterday utilities set a high. Fell significantly today 17. 3 at the close. We are waiting results from slack this hour. Well bring those numbers to you. Instant reaction as soon as they hit the tape first report as a public company. First joining us to talk about the market josh brown here ceo of Wealth Management anderson cnbc ibt counterer. Investment management and Senior Vice President of Charles Schwab mike santoli looking at sentiment and looking at the price action what can you tell us about where september is going so far. The market in august bent but didnt break sentiment got much more negative than the actual experienced losses we had in the market. That speaks to the resilience weve seen this month. Some signs also had macro fever might be breaking meaning were not so fixated on every tick in the bond market. The bond market has been a little mayor friendly. Back at the high end for s p 500. I think you can say its great to be at the high end of the range, still in the range at the moment you mentioned the vix being down again. Thats because stocks today are moving in different directions, not like the entire market going up or down based on macro factors. A little more back and forth. All the sectors were higher. My point, look at statistical measures of stock correlation all the stocks in the market, it was a little bit lower today thats something. What is the vix telling us, how theres still room for fear levels to come down. Yeah. There definitely are essentially if you saw the way outflows took hold in august from stock funds and all the survey stuff, yes, definitely built up a reservoir of concern that can now be bled away in the form of higher prices if you get clearance to do that from the numbers. Bhawhats your level of comft in the market. Official level is neutral within that in the u. S. Equity market, over wait small caps, sticking with that defensive tilt from sector standpoint but dont go hog wild into the utilities and reits you have to be mindful of adding to them on pullback days overall we still think were in this range bound environment and that the best position for investors it have is sort of stay close to longterm strategic allocations and use some of these swings to rebalance back toward those targets. What, liz ann, did the manufacturing gdp tell you earlier this week . Is that more important of an indicator than some of the stronger sentiment weve had out of the consumer . Well, it told us what i think many of us already suspected, which is that were in some form of manufacturing recession i think thats very clear to be the case groebl and it was confirmed not only by isma Manufacturing Index but prior to that the market index. That is not necessarily the death knell for the overall economy but theres a reason why even though manufacturing is about 12 of the economy, its still the largest contributor of a sector to the economy. Theres also a reason why manufacturing indicators dominate the leading indicators because they do tend to lead broader terms in the economy so far a pretty defined line between manufacturing side and consumer side, but i keep a particularly close eye on the employment data. Were already seeing unemployment claims tick up in the manufacturing oriented states if we start to see that spill over more prodly, then i think you start to chip away at what has been that firm dividing line between the two segments of the economy. Ive been going through a lot of research on pmi, manufacturing. Basically High Frequency economics put out Jim Osullivan a note last night low 50 contractionary its happened before but doesnt necessarily indicate recession when we do get to recession or approaching recession we get to low 40s or below this. I think as far as what the fed should do and investors should do with it, josh, how much of a worry, how much of an indication well, its not cumulative data, its an oscillator so lets keep in mind it could be below 50 one month and 55 the next month it doesnt trend its not the same as watching things like unemployment claims or auto sales. Its a very different animal so with any data series that oscillates, okay, you should be aware of what it just reported but then remember thats last month. Sometimes six weeks out of date. Things change really quickly highfrequency economics, the highfrequency part is the part you should remember. They are always taking that reading. I think bigger picture, and ive said this before, if you just focus on the consumer and the things that are important to the consumer, like jolts, rates, do people feel confident enough they can find a new job, look at wage growth, retail sales. That is the stuff that made you money to follow over the last 10 years. If youve been focused too much on the manufacturing portion of the economy, and im not saying its not important, im saying its giving you a lot of reasons to worry, a lot of reasons to come out of themarket. Make people say they said that about housing in 2007 its a small part of the economy. Its not a leader of the economy. Housing is really, really big part of the economy. For the typical consumer, its way more important than the stock market thats where all the consumers wealth is. Talk about middle class, housing is perhaps the biggest said that. The point nationwide decline of house payments ever. Subprime, so small. Doesnt lead overall economy into the recession. One of the issues, you had federal officials talking about how the consumer is coincident or lagging indicator of what is going on not to say its wrong but doesnt necessarily tell you how things trend from here i think things like ism are more important to corporate sector than the economy it creates the rate of change business to business, Capital Spending overrepresentative in the s p 500 relative to how big it is in the overall u. S. Economy. The truth is, id love to hear lizs take on this, if you offer me one of the two, its very easy for me to decide whether one i want you tell me, ill tell you how much in buybacks were done or ill tell you what the manufacturing readings are i would much rather know what the buybacks is. For me thats how i would establish a baseline reasonably of what the supply demand picture for s p 500 looks like and what levels we might be at i couldnt do that with manufacturing data. Pbuying heavy in 2007, josh, if thats aureofyour indicator. Future, not past. Liz ann, quick final word a couple of things. One, i think buy barclays aback important, the most important factor on the demand side and on the supply side, too the one thing i would say about the consumer, about half the mod he were day consumption had personal recessions stay in positive territory not only does it not lead, it can stay in positive territory and you can still have an economic recession you have to be careful about putting too much weight and expecting to only see it go into negative territory as a recession signal. Liz ann, thank you very much for joining us great to see you as always. We are awaiting slacks first report since going public, expected to hit any minute josh, your shareholder, last chance trade aflac ahead of the public debut it hasnt had great public debut. Down to 9 at its low its getting better. Im clinching, doing my kegels right now. Its not a trade, an investment. Im probably one of the first million slack users given how far back we built the firm we built the firm on slack employees all over the country, they are 6 h00,000 all over the world currently using slack, which an increasing portion is opting for the premium version, which is how slack etfs paid were looking for Something Like 50 Revenue Growth this quarter over the quarterlast year. If they deliver less than that, stock will have a two handle once again i will tell you options Market Pricing 15 or 16 move so expect fireworks in either direction. Hence, the clenching im doing here fortunately the camera stops here for everyone. The high valuation. Growing 00 a year prior to becoming public. We want to get back after the break when the numbers came, when they come out from josh brown who holds the stock. Ill be right here. Clenching. Google and ftc over google violating child privacy laws, hear from the Consumer Protection in 90 seconds indistinguishable muttering that was awful. Why are you so good at this . Had a coach in high school. Really helped me up my game. I had a coach. Math. Ooh. So, why dont traders have coaches . Who says they dont . Coach mcadoo you know, at td ameritrade, we offer free access to coaches and a full education curriculum just to help you improve your skills. Boom mad skills. Education to take your trading to the next level. Only with td ameritrade. Big news google hit with 170 million fine settling allegations of fed trade commission, new York Attorney general that youtube illegally collected personal information from children without their parents consent ylan mui joined by ftc bureau of protection director. Ylan, pick it up. Sara, thank you very much thank you, andrew, for joining us today you were head of the division that actually handled the division s since the settlement has been announced some concern from capitol hill, colleagues, that this is a drop in the bucket for google what do you say about that this is historic fine by anybodys standards. This is 30 times higher than our highest previous settlement. Its more than ten times the amount of all of our penalties combined in the last 31 cases weve brought. Its three times higher than the highest privacy penalty that any regulator anywhere in the world has gotten against google. So this is historic. I understand its not enough to provide deterrents i think what well see in addition to this fine, we have strong injunctive relief that will provide google and the marketplace with the guidance it needs. Youve called the settlement Game Changing because youtube will be the first platform that is actually held accountable and held liable for content posted on its site. Why do you think that is so significant . So this the first case of its kind under the childrens Online Privacy protection act holding a platform responsible for the content posted on the platform by others. So in our copper rule, it is illegal for content creator, for someone who runs a website or Online Service they know is child directed, for them to collect personally identifiable information from the users or website. But if youre a platform, its not enough the content be child directed, you have to have actual knowledge the content is child directed before you can be held liable for collecting information under this in this case we had strong evidence that youtube actually knew that many of the channels on its site were appealing directed to children, therefore liability. First time weve brought a case for content, user content. We have a question for you back in new york. Hey, andrew what recourse to increase punishment if this happens again or one of the peers or rivals. We can enforce against google or youtube ftc versus google or youtube in addition we can enforce childrens online protection act against any platform in terms of increasing the punishment, i dont see the punishment is inequality i think its consistent with our prior cases, our prior cases, consistent with the penalties we sought and attained in those cases. It just it larger because youtube is larger. I think its a penalty that sends a strong message to the marketplace. I have to respectfully disagree with the detractors. Another question from sara eisen in new york. I pulled up wheels on the bus by little baby bum on youtube. It has 2. 2 billion views how as an agency can you enforce and Police Youtube and take this word for it they arent going to bait kids into ads with so many views when they are selling to advertiser they have this behavioral data for consumers and so many kids watch so theres a lot bound up in that question. The first thing is that we are not taking googles word for anything in this order we require google to require all of their channel owners to designate whether the content is child directed or not. We also will continue our enforcement and investigation of google and channel owners for compliance with the coppa rule one thing to remember about coppa it prohibits i had fires for child directed content it does not, however, prohibit serving contextual advertising on child directed websites so advertising will continue on google, but it just cannot be targeted based on the users behavior. Andrew, there were a number of other measures that some critics have suggested you guys could have taken such as any eraser button that would allow them to athlete it audits of the company. Reviewing. Requiring the company to review kids content posted to its sight. Were any of those on the negotiating table . So lets take them one by one. The first was a content eraser right . This order prohibit google from using any of the data is collected for any purpose, even a purpose permitted under coppa. The second question was im sorry, refresh my recollection. Second, any measures you take in you feel this was a strong Game Changing settlement, andrew, thank you so much for your time. Thank you. Ylan and andrew, thank you for joining us we have some numbers out slack slack shares are sinking in the after hours, down more than 10 giving up all the gains we saw today. Let me give you numbers nongaap loss 14 per share, revenue a beat, 1. 45 million in revenue versus 141. 2 million expected thats an increase of 58 year over year. Here is what may be hitting the stock, thats guidance while q3 revenue guidance is coming in better than expected, the loss expected is worse than the 7 cents the company is expecting. The company is saying to expect a loss between 8 and 9 cents investors want to see this couple profitable, Revenue Growth and losses widening i also want to give you number, color around paying users. Especially the company is facing more competition from the likes of microsoft teens the company saying it ended the quarter with 100,000 paid customers. That is up 37 year over year saying also 720 paid customers that are greater than 100,000 in annual recurring revenue up 75 year over year they are making progress in terms of paying customers. Is it enough maybe not. Also that guidance hitting the stock down now 15 in after hours. Back to you. Thank you very much revenue up 58 , was that better than expected, all you care about at this stage . If youre buying this for the earnings, there were never going to be any this year. That was not what was happening. To her point, they did to bigger than they did. If youre a trader, youll make a sell tomorrow. They have more people paying than what was expected, a huge opportunity in front of them and the majority of potential customers are not standardized on microsoft its now microsoft and apple world and i think slack can really win there for me im probably a buyer now that its a two handle adding to my position, down from where i originally owned it but i can say the same thing about 20 different situations like this i really feel this will be one of the faster growing names in the Enterprise Software space and i like it for that reason. I wonder if theres a little bit of an Enterprise Software fatigue or still the hottest place on the market. I wouldnt say fatigue. I definitely feel like a lot of optimism built into the sector for this one, it is really a matter of you have to refine your expectation of what the real total Addressable Market is, not like the pie in the sky, entirety of all workplace communication. Does that come down on a threemonth basis they are not blowing you away with Revenue Growth numbers and microsoft meanwhile is there talking about their daily active users actually exceeding slack right now. Its kind of an interesting dynamic. You know, again, its expensive, people think its viable, product going to grow for a period of time, have you to moderate how fast it gets there. You think of Software Service names, this has been one of the sectors in the market, which is why slack got benefit of the doubt coming out of the date they didnt need an underwriter, a direct listing, enough of a highprofile sheen. A company like coup, dropped to 55, now 150, had a huge day today. This is another example of a company that became public at a high valuation, kind of stuttered out of the gates but the growth is so powerful in these types of names that ultimately they find their footing. I did think that will happen with slack well hear what the ceo has to say. I think hell be on tomorrow morning. I will break my normal 2 1 2 hours of yoga and sit and tune into that instead. You have it in the background during your 2 1 2 hours. No, things are serene. Youre going to walk home over the bridge. Perhaps perhaps. Looks a lot like dropbox. I think the business operates with a similar feel to it. I was referring to like a workday. Youre right about that. The perception. But they have to crush. Slack had better than expected but this is not a crush. If you want to have come out of the gates, you need to shock people to the upside that is clearly not what happened tonight thank you, josh. Extra josh on slack. Investor for uninverting this morning a longterm look at what that can mean for the economy do you have concerns about mild memory loss related to aging . Prevagen is the number one pharmacistrecommended memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. So servicenow put your workflows immhm. Cloud, huh . Your employees must love you. Thank you. Ah, you could say that. So how are things with you guys . Great. Thank you. Thank you, sir. Lunch next week . Terrific. Say hi to the team. Will do. Call my office, i will. Sounds good. Alrighty. Servicenow. Works for you. Hey. You must be stevens phone. Now you can know whos on your network and control who shouldnt be, only with xfinity xfi. Simple. Easy. Awesome. Of the day looks like youre stuck at the beach. Just offshore, trying to make it through the water, various roiling currents thats what the yield curve has done the difference between the twoyear and tenyear. Were in kind of recession panic mode for a little while. This is a very longterm view of this relationship going back to late 70s basically at 40year view. This is where we are this is a month end number, we never spent a full month below zero we got to zero, a fair bit ahead of a recession here is an interesting one, too. That was 1998, a good deal, like three years before the on set of a recession. I do think the market in general overanticipated what this meant. It didnt necessarily start the clock, flip a switch to say we were in recession vigil mode, even notwithstanding all the explanations for why not as powerful. A shorterterm view of this, even when we did invert, it was barely here is the zero line. Were actually above the zero line this was all we did. We just kind of knocked around it a little bit. No pronounced inversion. I do think we have to take it all with a grain of salt not because the indicator doesnt matter, hasnt been persistent, deep enough to tell us all that much yet. Not yet well see what happens up next, breaking down global risks, dow rising as hong kong tensions ease. Trade, brexit, argentina front and center for investors your protection play fwook globally straight ahead. Every new job. And attempt to parallel park. electrical current buzzing each new draft of every novel. typing clicks the finishing touch on every masterpiece. newborn cries it is humanitys official twoword war cry. Words that move us all forward. The same two words that Capital Group believes have the power to improve lives. And that, for over 85 years, have inspired us to help people achieve their financial goals. Talk to your advisor or consultant for investment risks and information. Talk to your advisor or consultant through the at t network, edgetoedge intelligence gives you the power to see every corner of your growing business. From using feedback to innovate. To introducing products faster. To managing website inventory. And network bandwidth. Giving you a nice big edge over your competition. Thats the power of edgetoedge intelligence. Welcome back palo alto earnings out josh has a number. Reporting eps of 1. 47, revenue 806 million versus forecast of 802 million billings 1. 1 billion. Terms of segments, product came in lighter than expected, 206 million street looking for 315 million. I did talk to one analyst and said, listen, hes buying companies, focused on cash flow metric, came in below what the street is looking for. Making another acquisition here acquiring a Company Called zing box, Iot Security Company for 75 million. Saying given proliferation of iot devices and enterprises this acquisition makes sense. A lot more about the acquisition on the call which is starting right now. Guys, back to you. Josh, thank you we know youll monitor that. Down 5 after hours. Time for cnbc news update with sue herera, hi, sue. Hello here is whats happening this hour President Trump said Hurricane Dorian was lucky with the path but concerns up the coast. He met with reporters after receiving oval Office Briefing from emergency officials. We certainly got lucky in florida. Now if we can get lucky in georgia. If you look at south carolina, North Carolina, it could even extend beyond that so were talking about virginia. Hard to believe. So well see what happens but its a very erratic, very slow, very powerful hurricane. Hong kong police faced off with protesters hours after chief executive carrie lam announced the government would withdraw the controversial extradition bill Footage Showing Police guarding the train station with protesters chanting outside. Premier Giuseppe Conte forging a Coalition Government teaming up with populist fivestar movement and Center Left Democrats in an alliance blamed at right wing forces from power. He will dedicate his energies to making italy better for all italians youre up to date. Thats the news update this hour sara, ill send it back downtown to you. Sue, thank you. Twitter hackers appear to be taking over another highprofile account days after ceos account was hacked julia has more. The hacked account of chloe moretz, and tweeting out the ceos security number after hacked friday. Turning off via text message in order to protect peoples accounts saying, quote, were taking the step because of vulnerabilities that need to be addressed by mobile carriers and our reliance on having a linked phone number for twofactor authentication. Working on improving this. A small number of twitter users use this sms format. Offense to you. Julia, thank you very much. Huang sink up 4 after hong kong chief executive carrie lam with drew controversial extradition bill that sparked two months of rallies and demonstrations s protests are expected to continue this is only one of five demands activists are calling for. Was it too little too late lets bring in michael from the Eurasian Group lets put that question to you, too little, too late. I think so. If its an opening, its a modest one a lot of pressure on carrie lam, hong kong chief executive to follow this up with more substantive moves. The market took it really positively did china blink . I think early to say they blinked. More pragmatism. Important in terms of Market Reaction and chinas reis that one thing it does do, which is significant, it lowers the risk in the near term of large scale crackdown by beijing thats serious, something the market was rightfully worried about. At least buy more time for perhaps a political dialogue i think the tail risk for right now is a bit lower than before carrie lam made this move. Ultimately for protesters who may have demands or ambitious or hopeful expectations of where it ends up, should they realize ultimately china is never going to compromise on its most important principles and settle somewhere in between well, you could make that argument certainly i think for men of the protesters in hong kong, this has become an existential issue, to some extent, with beijing they are looking at this as a historic moment to try to draw a line for beijing some of this is also internal hong kong, to the extent that one of the key demands of protestes is an inquiry into Police Actions so this is not all about beijing. Its about carrie lams government and the fact these protests have really created significant fissures in hong kongs society. The fact the administration has remained so quiet about this, what does that tell you about President Trumps strategy and what ultimately if things do calm down as a result of taking away from extradition bill will mean for u. S. China relations . I think the real worry for President Trump is that there would be a serious crackdown and that would have been something that forced his hand and really prevented any meaningful deescalation on the trade dispute. If were at a low level certainly serious protests but not talking about a crackdown, then i think President Trump is going to basically continue more or less and theres still room for trade negotiations if he decides to go there. Were not optimistic about that either i think at this level of unrest. It doesnt force the u. S. Hand too much. Is one of the chances that the protest just sort of lose a bit of energy because of this measure because of time going on. Back to school. By the hong kong authorities . I think thats the bet of hong kong authorities by beijing. It seems like an overall opt michk bet by my. I think at this point the outlook is a continued stalemate. Perhaps at a slightly lower level of intensity now that theres been this opening move but i dont see a meaningful improvement and i still see pretty high hurdles for this crisis to be finished any time soon. Mike, thank you for joining us your latest take what have you got . We just got the results of the brexit votes, a reminder this was Prime MinisterBoris Johnson seeking to call an early election that requires twothirds majority of parliament, 650 mps, so need 433 votes. Didnt even get a simple majority, 298 votes in favor we will off the 430 odd that would be required. No early election based on this. That said, only 56 votes against it, so a huge number of people abstaining from the vote jeremy corbyn, leader of opposition and labor part did make it clear when the bill has got royal ascent, it would be to vote for the election. You can see it playing out in the number if those labor voters started to vote in favor of th election, it would probably be enough a lot of moving parts. This case would be now no election tonight but quite probable still but an election called in the next three or four days and fall on october 15th as the Prime Minister wants. But for now no deal brexit is farther and no election is farther . For now no deal brexit is less likely based on a week ago, so the pound is up 1 1 2 over that week but still near significant lows an election is more likely than a week ago but less likely than it could have been essentially. A lot of voting. A lot of moving parts if an election gets confirmed, it would seem to be only after this no deal bill how do you get streaming parliament, whats the website. Colleagues and streams global news for free. All right keep us posted still ahead, shares of slack trading lower after posting results just moments ago first as a public company. Actually now at the session 15 . Remember the listing price back in june at 26 so were right back wndo there well have instant reaction to the numbers straight ahead geico makes it easy to get help when i need it. With licensed agents available 247, its not just easy. Its havingjeromebettis onyourflagfootballteam easy. Go get em, bus ohhhh [laughing] cmon bus, cmon hey, wait, wait, wait hey man, i got your flag i got your flag, man i got your flag its geico easy. With licensed agents available 24 7. 49 nothing woo keeping our eye on slack shares, they are plunging more than 15 after issuing weaker guidance earlier this hour balli falling below that 26 price they listed at in june joining us to discuss is rohit, Senior Analyst you had liked this company for 40 price target is this a buying opportunity or equally disappointed as the market its a disappointing result i wont mince any words here it was essentially for slack to come out of the gate and be as great as anybody else. What you see here is slack had onetime issues. We would love to get more detail on the call. They talk about 8 million in lost credits that affected the revenue beat margin we would love to get more color on that. Two Silver Linings in here a good leading indicator in my opinion. The company is probably taking steps towards profitability faster than what the street expected these two Silver Linings this is big expectations correction and we want to figure out why there wasnt as much upside as we thought it was. How did you get to your 40 target given multiples of where it stands at the moment . The valuation of slack is not for the fainthearted evaluation of most of these highflying companies, we are putting like 26 revenue, which implies sustained Revenue Growth over the next couple of years. Revenue will grind higher but probably expected much higher upside given this was the first Earnings Call for slack. What are you focused on in terms of rivals and how long slack has to continue to cement its market position and become profitable before it would be squashed by the likes of microsoft. Yes from a rival standpoint, microsoft is the key player we are keeping a close eye on what we found surprising, bears would point to this, slack hasnt reported daily active users. Everybody following the number microsoft gave in terms of daily active users in july we would love to know where slack is today is it more than 13 or less than 13 thats the key question for the call with management today over the longer term, a large market slack has the potential to land and expand their Enterprise Customer base needs to grow. They are adding about 70 to 80 Large Enterprises every quarter. There is stickiness here but, again, how much upside is something we want now. All right, rohit, thank you very much. Does this say anything about the direct listing process since were talking about a price thats below the level. Its not a great vote of confidence for had you these things trade ipos also flop uber and lyft are examples spotify and slack are the two most prominent examples. Nets one traded all that well relative to what they first did. Soon to come on closing bel bell, zoom video, impressed last quarter but can the recent ipo do it again. A look at what to watch when we come back. When i lost my sight, my biggest fear was losing my independence. Mmm. Good. So ive spent my life developing technology to help the visually impaired. We are so good. We built a guide that uses ibm watson. To help the blind. It is already working in cities like tokyo. My dream is to help millions more people like me. By the way, shes the it wasnext mozart. G day. It is already working in cities like tokyo. As usual we were behind schedule. But sophies enthusiasm cannot be dampened. Not even by a runaway donut. We powered through it in our toyota prius. Because a stars got to shine, no matter what. Its unbelievable what you can do in the prius. Toyota lets go places. Should always be working harder. 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Melissa lee has been investigating the booming industry in her new special high risk, high reward cannabis, inc. It just might be the new cannabis, psychedelic drugs. Paul, how often do you take ectasy four times. Reporter not to mention alarming side effects. People are said to have died by falling out of windows after thinking they can fly. Reporter are now making a comeback and now magic mushrooms were decriminalized in oakland, california, and denver, colorado oregon is now considering a similar measure. Free the spores. Reporter all this as psychedelic advocates echo the same arguments that worked for the marijuana industry. Smoke some weed, smoke some more. Reporter there is more medical efficacy for psychedelics than there was for pot. Investors are taking notice. Including peter teal the biggest backer of tilray hes backing the medical psychedelic space as well. Psychedelics may be the future but pot stocks are still your best bet right now youll hear why they think another cannabis book is around the corner it airs tonight high risk high reward cannabis, inc. Im curious, melissa, how much science there is for medical psychbzdelik. There has been research done. There is actually one ectasy based drug for ptsd, treatment for ptsd that is designated by the fda as a breakthrough therapy. In terms of where it stands against cannabis, theres one fda based approval for cannabis based drug epidialects its hard to do tests on a schedule 1 drug. Thats one of the limitations. People want to do the Research People want the Science Behind it, but its very difficult to get that certification to be able to do that on a schedule 1 drug all right melissa, thank you well be watching. 6 p. M. Even. Melissa lee. On deck, a look at lululemon. The battleground stocks tomorrow will give you a preview next were keeping our eye on slack the company just out with results and it is plunging hard. Down 15 at the 26 level that it saw at its public listing. Well be right back. Kevin, meet your father. Kevin Kevin Kevin KevinKevin Kevin KevinKevin Kevin Kevin trusted advice for life. Kevin, hows your mom . Life well planned. See what a Raymond JamesFinancial Advisor can do for you. Servicenow put our this changes everything. Youre right sir. Everything. No not everything, i mean youre still blatantly sucking up to me gary. Brilliantly observed, sir. Always three steps ahead. Six steps ahead. Sixteen. So many steps. You done . A million steps ahead. Servicenow. Works for you. The key things every trader needs to know on a new trading day when closing bell returns. Are we supposed to dance . Boy bands without dancing are just ok. Get a better than just ok unlimited plan with spotify premium included on americas best network. 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And that, for over 85 years, have inspired us to help people achieve their financial goals. Talk to your advisor or consultant for investment risks and information. Lululemon and zoom video both reporting results tomorrow. Sarah has the reports from lululemon. Back in april the Company Detailed its growth plans doubling the mens and online businesses, quadrupling international and entering footwear in a serious way. The stock is up 48 in 2019 under ceo Calvin Mcdonald whos just been about a year into his tenure, it has continued a very strong run investors are just looking for confirmation that the brand is still in great shape and resonating with consumers. Its facing two difficult things, top comps because its lapping double digit comps and High Expectations and a higher valuation but lululemon has repeatedly delivered because of its connection with consumers. Watch for 30 plus digital comp stores. We will watch for that and zoom tomorrow. If zoom impressed investors with the first earnings report, how is it going to fair when it reports results. Shares have surged more than 160 from that 36 price in which it sold shares in the ipo. I talked to analysts that respect the company and story. They also argued that it looks richly valued. Back to you. Thanks very much for that dont miss tomorrow. Exclusive interview on closing bell with ceo of box. Aaron levy we are out of time thanks for watching closing bell. Fast money is up right now. Life in the Nasdaq Market site overlooking new york citys time square this is fast money. Im melissa lee. Stocks are running back to life with all 11 s p sectors finishing in the green tech the big winner. Coming up not one, not two, but three charts telling us where we are heading next slack getting whacked. We will break down the big headlines, but we kick things off with something, this is something that we have never done in almost 13 years on the