Transcripts For CNBC Closing Bell 20160729

Morning. Where oil prices could be headed next, in a moment. Shares of hewlettpackard enterprises rallying on a report this afternoon that private equity firms may be targeting it for a buyout. Well hear from the reporter that broke that story in a few minutes. Lets start with earnings trouble in the oil patch. Bob pisani, big misses for chevron, as well. Yeah. Enormous write down. The stock prices right to the actual numbers here. Exxon and chevron both reported much bigger missing than anticipated. In the case of chevron, reported an enormous write down. 2. 8 billion for projects just not economically viable at the current price of oil an apparently they dont think viable for a listening time to come if ever here. You see price reactions fairly modest. Let me explain the pickle a lot of Big Oil Companies are. And use exxon as an example. Cash flow 4. 5 billion. Care enough. The Capital Spending 5. 2 billion and the Capital Spending is more than the cash flow theyre getting. They have to pay the big dividend. Thats a biggest on the street. You add it all up. The dividend and the Capital Spending, over 8 billion and a funding gap of 3. 8 billion they need to cover the spending, overall spending. Where do they get the 3. 8 billion . They borrow it and cutting spending and they hope they pray oil prices go up. By the way, are you worried about the dividend . Dont be. Only one of the good pieces in the overall report. The company said, exxon, were resolute in a commitment to pay reliable and growing dividend. Its safe. Chevron said the same thing. Its the first priority. And they said they may consider increasing it if the cash flow increases. If it increases overall. The big issue is oil. Folks, going down. Very simple. Theyre going to have to do one of two things. They will have to, number one, merge or do merge somewhere down the road if oil stays at these low levels a year from now and certainly have to, analysts will have to lower earnings expectations for Oil Companies in the second half of the year and remember these Oil Companies, guys, major part of the idea that the s p could turn positive on earnings in the second half of the year. Oil could be a big fly in the ointment for earnings. Back to you. Thank you, bob. You have to wonder what theyre sacrificing at the altar of the almighty dividend to get it going. The number to watch about 41. 33. Just above that level. Lets discuss where it goes next with matt smith, director of commodity research. We broke below 40 briefly or 41 i think earlier. What do you think will happen next year . Next year is a very long way away. I think what we are going to see go. Ahead. Sorry. The next couple of months will really dictate what prices do next year. Weve really been on the wild ride for two years here we are getting the w kind of playout in prices and i think dependent upon whether we dip lower Going Forward here and then we start to see that market rebalancing coming through next year we should see prices coming through with some support as we see ongoing production on a global basis starting to really come off lines from the likes of mexico to china, et cetera. But for now, it seems that we are going to be under downward pressure. Well, one of two things has to happen for this glut to disappear. Either production has to be cut or demand has to go up. What do you think is most likely . Especially if its a production cut, whos likely to do that . As i mentioned, we are likely to see sort of incremental production cuts coming across the board really from the likes of, say, as i mentioned mexico to china. As some in the north sea, as well. Im sorry. I heard that part. But what i didnt hear was the big guys, the saudi arabias, the u. S. , the russias. The big players in all of this. Thats where its not going to be coming from. Thats why im not mentioning it. Were likely to see saudi arabia continuing to pump. Theyre at 10. 2, 10. 3 Million Barrels a day here. They keep on pumping strongly. The u. S. Likely to bottom out next month according to expectations and gradually rise through the rest of the year as we see production coming online from the gulf of mexico. And so, were also seeing production continuing to increase from the likes of iraq and iran from opec and so its not going to be the big players that are making the cuts. Even russia is potentially going to hold up around that sort of 11 million barrel a day level and so the production cuts are coming from the smaller guys and increment al incrementally. Oil prices, likely to retest the lows we saw earlier this year . What do you think . I think we are unlikely to get down to 26 again but never say never. I think what we have got here now is support around the 40 level on a technical basis an enshould we break that, as we see slowing imports into china, demand dropping off from them as their stockpiles are filled up to the brim then i think we should likely dip into the 30s. All right. Well see what impact that has across the markets. Thank you, matt. Thats matt smith. Thank you. Barclays shares dropping today ahead of European Bank stress test results due in about an hour from now. Will fred frost has the latest. In line revenue and stronger than expected earnings mainly due to lower costs and the core uk business did better than expected. Sharyls up sharply today. Despite earnings falling one third highlighting how low expectations were following poor European Bank results elsewhere this week and barclays shares down sharply year to date. Now the results of the stress tests. Spotlights will be on deutsch bank and italian banks where theres political pressure on renzi, the Prime Minister of antieu parties, to save the banks. Italian bank shares have rallied today after it was confirmed of a bailout, a private bailout for the embattled bmps. Here, barclays ceo talking earlier about the wider health of European Banks. The European Banking sector is challenged. If you look at the top 12 banks across europe, on average theyre trading at about a 50 discount to book value. Thats not healthy for the financial system. Thats not healthy for the european economy. Overall European Bank stocks getting some welcome reprieve today but year to date the stock 600 bank index down nearly 30 . Stress test results out at 4 00 p. M. , guys. Whats at stake for the stress tests . How similar are they to the u. S. And seemed more like people waiting to get capital out of the banks and in this case, how much capital right need to go in them . Exactly right. Thats where the European Banks are a few years behind the ugs banks and still a question of whos going to need to raise capital. The difference, though, to the european stress test two years ago, theres no immediate pass or fail. Not quantitative. Its qualitative. We have to dive into the numbers deeply and focused on the cet one ratio, the common ratio is of the banks and italian banks really in the eye of the storm. Political contagion possible there and in terms of big banks, boich bank, the focus. If they had to raise capital, the price to book very low and hard to do so. Why are they waiting until 4 00 here in the u. S. In thats late on a friday night. Trying to bury it in europe or what . We can draw conclusions from that. Waiting until all equity markets have closed for the week and no immediate overreaction and i suppose they hope that if people have the weekend to dive into the numbers then they can make sure theres no exaggerated response in the market immediately. All right. Well, well all wait for those numbers. Thanks. See you later. Catch his exclusive interview of Ceo Jamie Dimon monday at 1 00 p. M. Eastern time right here on cnbc. Dont miss that. Lets get to the Closing Bell Exchange for a friday. Today, joining us, doug gordon, Kenny Polcari and our own Rick Santelli joining us from the chicago mercantile exchange. I had the numbers, kenny. For the month, the dow up almost 3 . The s p up more than 3 . The nasdaq up 6 . With oil down 14 . I mean, clearly the correlation between those is dead. But not a bad month for the stock market. No. Not a bad month and it does feel toppy. The end of july here. August will start next week. Can be a tough month as we know. But listen. We have traded for 12 or 13 days now in a very, very, very tight range and i think 2165 to 2175. Yep. We are trading at 2175 once again. Tapping our head. But the market feels tired, exhausted. I think august could set up to be more of a volatile month. I suspect to see the market back off a little bit. I expect the oil is going to 35 really where the Technical Support is and 40 is a psychological number and the is real support in the mid30s and i suspect that oil will test it. Doug, explain the Central Bank Moves here for us. Bank of japan maybe not delivering what was hoped. Here the fed, now the markets pricing out a rate hike to early next year. Yeah. I think thats right. Its a case of the number disappointed an enyou get the argument why the market responded first negatively and then came back and thinking that the inventory buildout is pushed forward. But the most important thing to that is wheres the strength been thus far, right . Its been the consumer. Thats where the watch point is going to be. The question is starting level we started today at even with that weak gdp number where we should be . I think all the points that kenny made and earlier that, you know, we have oil price, you have the election, you have certainly got weak earnings thus far in europe this year and weaker than anticipated the start of the year and get us to be relatively protective around a diversified multiasset market. Rick, we are remiss not mentioning the dollar and what it has done today. Big decline against the major currency. Yeah. No. Its a huge decline. I think a lot of that tied up with trades trying to handicap the economy in the u. S. In particular and what it means for the fed. And they had it right. Fx traders had it right but theres another dimension. Its going to be interesting to see how bad the tests show up out of the ecb stress test. 51 points. I think this is a big issue and a big issue for all investors because the banks, other than the smoke and mirrors, deteriorating like ice in the sun for years. Now, probably theyll find a way to reignite the frog and get the legs to move. Consider if you look at every sovereign piece of paper throughout europe they have been pushing the yields down, not only week but especially today in lieu of the stress tests and all the fixes that may go along or cash ups that may go an i long with it. We are closing in a dozen basis points down on the week on 10s. Ten basis points on the week on 30s. When you consider the alltime low yields, this is pretty incredible. 135 is alltime low yield for a 10. We are ten basis points away. 209 for 30s. Nine basis points away. What happens at 5 00 eastern less than an hour from now could really make it quite exciting to those alltime low yields and trading much closer to them sunday night and monday. I wonder, kenny, what extent that gdp number and the revision low tore the First Quarter to overshadow the data of next week and jobs number friday. Im not sure it will. The gdp numbers out. I think rake made the point. Tonight when these European Bank stress tests come out it causes over the weekend chatter. The focus will be much more on what we see in those results as well as the data next week. The nonfarm payroll next week. Its clearly off the table. The feds not going anywhere. Forget september and december. We are well into 2017 in terms of a rate hike thats coming. Doug, we are more than halfway through the earnings season now. Numbers have been pretty decent. What . 70 of the companies have beaten the estimates here. What do you make of it and where do you see opportunities for investors right now . Yeah. Thats a little bit of a low bar, right . Estimates pulled down a little bit and then they could clear them and an element of where they were set at in terms of beating estimates and revenue paints a different picture. With respect to Going Forward, it puts a premium on diversification right now given that we think things are stressed at the levels of right now. I think its a case where i agree that the nonfarm payrolls very important and tonight, look, the Global Financial crisis purged the banks in the United States. Thats not happened in the european union. And theyre now doing it with equity prices far higher than we were back then. A lot at stake in those results. Due out in a couple of hours. Thank you for joining us on this friday. Close out the month of friday. Doug, kenny and rick. 45 minutes to go in the session. Dow down 35. S p trading at an alltime high today. Intraday high. The nasdaq up 3. All right. Well come back and talk with a Carnegie Mellon professor saying if apple wants to increase the fortunes it is time to share. And hell explain coming up. And with the rio olympics kicking off one week from today, theres a report in the progress against the zika virus coming up. Youre watching cnbc, first in business worldwide. When it comes to healthcare, seconds can mean the difference between life and death. For partners in health, time is life. We have 18,000 people around the world. The microsoft cloud helps our entire staff stay connected and Work Together in real time to help those that need it. The ability to collaborate changes how we work. What we do together changes how we live. But the best place to start is in the forest. Kubo i spy something beginning with. S beetle snow. Kubo no. Beetle snow covered trees. Monkey nothing to do with snow. Narrator head outside to discover incredible animals and beautiful plants that come together to create an unforgettable adventure. Kubo wow narrator so grab your loved ones monkey dont even. Narrator and explore a world of possibilities. Kubo come on, this way. Narrator visit discovertheforest. Org to find the closest forest or park to you. Check out the nasdaq 100 heat map today. Pretty nicely split. I thought it would be a little more green on the list there. We do have google parent alphabet among the leaders today. In there somewhere. You heard it here late yesterday. They beat on the top and bottom lines thanks to increases in googles mobile ad business. A story that reminiscent of what facebook has to say the day before, as a matter of fact. Google shares up about 3. 5 . Apple stocks picked up steam better than expected. The stock up over 5 for the week and still concern that the innovation engine stalled and needs something world changing. One of those searched is Carnegie Mellon universes professor. He has a solution and your solution is to share. I mean, you want them to be more open with their technology. Is that the idea . Exactly. If you look at the results, facebook and google are both, you know, conquering the market because theyre going after hundreds of millions and now in the billions of users. Apple has a limit market and the market share is shrinking and focusing on hardware. The beauty of what they have is their software and if they open sourced ios and made it available on samsung, htc, show me the phones, they would be adding hundreds of millions of users and apple revenue, bright spot this week is subscription and services revenue. App store, music. Soon offer tv stations. They could own a decent chunk of a large market rather than having 100 of a tiny market. Sure. But what are the issues here . I imagine one has to be security, right . No. All of the issues are surmountable. They have to work with the vendors and make their operating system work as well on their hardware as it does on the apple hardware. Its the same. Samsung hardware is better than apple right now and they could figure this out. Its not a big deal. All right. So we have established theres a lack of a revolutionary product coming our way. So in the meantime, wouldnt you agree that their future is in the services business, socalled ecosystem to offer because if you play the game in hardware, you are becoming too come mod tized, right . Exactly the point i would make. Money is in software. Apple has no chance of being a pokemon. Look at pokemon. It went viral and hundreds of millions of people using it. That cant happen with hardware because every time they sell a device they have to manufacture it and takes months to get there. The beauty of software and subscriptions is viral. It is the market that apple is missing out on trying to keep everything closed. They went almost bankrupt in the 1980s because of this thinking. Is there a reason why people satisfied of the operating device and the apps and the preferences for existing services, you know, i guess these things are sticky, that classic term, right . Exactly. Lets share them and put them on different platforms. Ill bet you many, you know, at least half of the Android Users would download ios with the option and then a beautiful new interface on the same device that they had before. This is technically possible. What about these new markets that tim cook points to . India being one of them that they feel could be a game changer for their hardware business down the road. Youre not buying that . No. Im not because their phones cost about 400 in india. You can buy a smartphone as low as 50 in india right now. If youre an average middle class indian why would you spend 400 on something you dont care about . Theyre used to android. The vast majority of phones run android. Thats what theyre brought up on. Why bother to spend ten times as much on an apple phone when you can get a beautiful device for one tenth as much as what the apple phones cost . Apple is going to lose india because its overpriced there. Going back to your suggestion about then licensing the ios software, would they charge a lot for it . If this is a significant revenue stream for them, does it make them out of reach . Well, they could price it at zero like microsoft is doing with the windows operating system and making it available for practically nothing. The money is in the subscript n subscriptions. Look at apple growing at 19 last quarter because thats where the money is. If apple brought the tv Services Online they have been talking about providing ala carte tv on their iphones, well, that would believe another massive market and start selling the great apps to, you know, customers it doesnt have right now. We are talking about ten times the market size of what it has today. This is what is possible. All right. Thank you for joining us this afternoon. Thank you. Well see if couupertino is listening. They dont listen. Thats a big change in the culture. Right. Here with the markets closing out the month of july mixed. The dow is still down 30 points but the s p and the nasdaq trading higher here. Flirting with the level, main Street Investors tell us whats on their Shopping List and whether that list still includes apple. Stay with us. Im connecting our brains so we can share our amazing trading knowledge. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at td ameritrade. Welcome back. Heres shares of western digital. Down more than 11 . Its Quarterly Earnings better than expected but the companys First Quarter Earnings Guidance disappointed. The shares down more than 6. All right. As we know Hillary Clinton capped off the Democratic National Convention Last night with loads of applause. But did she win the hearts and minds of voters . Eamon javers with a recap this week. Eamon . A big challenge for Hillary Clinton, particularly given that earlier in the week we saw the protests by Bernie Sanders support earls at the dnc in philadelphia and then a question of being overshadowed by president clinton, current president obama, two charismatic speakers and moving audiences in a way Hillary Clinton is not known to do and for my money the most powerful moment of hillarys speech tiptoeing up to an acknowledgment of a biggest flaw in the president ial candidacy and people seemingly just dont like Hillary Clinton. Theres a real high negatives for Hillary Clinton in the polling. She seemed to acknowledge that last night. Heres what she said. The truth is through all these years of public service, the service part has always come easier to methane the public part. I get it that some people just dont know what to make of me. So, let me tell you. And from there, she launched into the biography, her history. Her role as her mothers daughter and her daughters mother. All of that designed to humanize Hillary Clinton and reach out to independent voters who may not have made up their minds yet. It is a tricky thing to do. Hillary clinton really reaching out, though, last night, guys. Were talking about the ratings a second ago, too. I dont know if thats just chatter in our business or if theres a correlation of how many people tuning in relatively speaking each night to the rnc and dnc are all about. We are obsessed with ratings and it is a barometer of interest and a barometer of how controversial the candidate is, donald trump has been generating huge interest and ratings through the campaign season. But you wonder how many of those people will vote for him. Right . Are there people out there hate watching donald trump or people who say, you know what . Thats my guy. Ill vote for him. Not clear that the mass i ratings and interest translates into votes. Hillary clinton making the case she is the most qualified candidate theyre saying at the Democratic National convention, the sane rational choice and see if that triumphs over entertaining and exciting. Can we go back to hate watching, bill . Do you guys hate watch anything at home . No. No. If i hate it, im not watching it. Ive hate watched a few things. I wish we didnt have to wait for november 8th. Lets decide this thing once and for all. Its a good point of absentee ballots. Yes, maam. Well see. Thank you, eamon. You bet, guys. I think howard stern once said that actually when he was, you know, first radio deejay and realized people listen to him because they hated him. Well, if you fascinated to watch a car wreck waiting for that to happen, sure. I can understand this. Dont tell us if thats why people are tuning in now. 30 minutes to go. Now for a cnbc news update. Sue . Hi. Well have more on the ratings for you in a second here. But first, though, florida has become the first state to have a local transmission of the zika virus. Governor rick scott making the announcement this morning in orlando. While no mosquito traps tested positive for the zika virus, the department of health is aggressively testing people in the affected area to ensure there are no other cases of this virus. And here are those numbers, early data says Hillary Clintons acceptance speech attracted 27. 8 Million Viewers across 6 tv and cable networks. This suggests her tv audience lower than Donald Trumps acceptance speech pulling in roughly 30 Million Viewers. A delaware judge ruling that redstones lawyers must defend the move to oust directors of the board in a trial. He proposed october 17th for the beginning of the hearing. Indiana has a new Mega Millions jackpot winner. The winners of the 536 million prize bought the ticket while they were out on a saturday afternoon headed to kids sporting events. Family wants to remain anonymous and they have hired a spokesperson to accept the ticket and speak on their behalf. They took the lump sum. First time. First time ever. Yep. Played the Mega Millions. They bought five tickets. First time ever and they dont have to do it again. Nope. Thats it. Pretty ironic. Beginners luck. To say the least. Yep. Thank you, sue. Sure. You know what . I wish all the lotteries would allow people to remain anonymous. I think it should require them to. Remain anonymous . Yeah. Opening yourself up to nonsense by having to go public with that kind of stuff. I dont know. But we digress. 30 minutes left in the trading session with the dow down 35. Closing out the month of july, leading trader will tell us what hes watching going into the close on the final trading day of the month. Meg terrell with how soon we could see a zika vaccine. Stay tuned. Welcome back. We love to look at the heat market. Heres the month for july, a month where technology up nearly 8 . Thats again paced by the back half results of alphabet, facebook and amazon. On the other side of things, energy down 2. 25 . Although, bill, i think you said oil dropped 16 , 17 this month and i guess held up relatively well. Four in the red. Six in the green. The others lagging of telecom and utilities and see if august continues the theme or inverts it. We are heading to the closer number two position there is health care and we want to focus on that right now with carter worth. You think that theres a catchup phase for health care coming here. Right . Thats right. Two ways to find opportunity. Favor a winner or a laggard and health care has been year to date and then showing nascent relative strength. Thats the bet here. What do we have here . Two panel chart and going back two years, huh . Twoyear chart and the s p 500 Health Care Sector itself on the top and then its the relative performance to the s p on the bottom. And i think whats important here is that, yes, we have noenl its gone up on an absolute basis. Again, this is a ratio. Outperforming the s p. So having been a laggard, it is starting to outperform and we know this. That the s p has made it back to its high. Right. But the health care has not. So we want to play, you know, we want to play health care for a catchup trade to get back to the high and in this instance, it is the recent outperformance after having underperformed that i think is the opportunity and going to make it as an overweight or continue with the overweight relative to the mrkt. How long are you willing to let it go . It should go, intermediate period. Almost the end of the year. Thank you. Thank you. Kelly . Last trading day of the month and time to check in with main Street Investors. Joining today, the founder of make it better media of chicago and wayne smalls joins us once again, an engineer of d. C. Welcome, guys. Wayne, we want the know how youre doing with that apple position with the high recent move higher. I have paired back some of the shares. A supply chain of apple so im happy to see its gaining a little upside as well as nxpi. Im confident to see further upside as we move closer to the launch of the next iphone. Dont you hate it when it goes up after you scale back . Absolutely. The market overall, wayne . Well, ive been buying frequently, well, biweekly with the 401 k over the course of the last year and for what i see right now i think we see more to the upside than the downside. All right. Susan, i see a lot here that youre doing and its all, you know, you like facebook, you like alphabet, you like eli lily and thinking about buying tesla. Really . And i understand you just did a story on lithium and batteries, too. Right. Exactly. So, i am absolutely intrigued with elon musk and all hes trying to do and talk about major impact on humanity if he accomplishes it. What about as an investment, susan . Well, im nervous. So i am still as a retail investor, i like investing in stocks i really understand. They feel like gold chips. And more than ever, i do look for social impact, though. So thats why tesla is intriguing to me. Social impact. Facebook is social in a different way, though. Whens attractive to you about facebook here . So look at first of all look at Mark Zuckerberg and his wife and trying to create a greatest social impact and i watched the dynamics of elections, fund raising, collect and share and generate support and i see facebook part of that. Google i dont i dont see them doing that as much yet but im confident theyll get there. Eli lily, i grew up in indianapolis and a company that they looked at creating the greatest social imfact my city and for their employees and around the world. So thats my motto. Thats a homer play right there. Wayne, you know, in your 401 k you say your dollar cost averaging into the s p 500. I love this strategy. We dont hear enough lately about dollar cost averaging. Its too oldfashioned. It doesnt work in todays world with the fast volatility we have getting here and you are still doing it, right . Yes. Im still doing it. Im doing it for many years and last year when i saw the market slowly going down, the 401 k is linked to the s p 500 and going down its a sickening feeling but the only benefit is you hope that youre actually able to buy into it on those very low days on a negative 600 on the dow or s p 500 negative 3 on a given day, those are perfect days where a dollar cost averaging investor can benefit from. How long before you need that money . Guesstimate. About ten years. Yeah. So you got time. Right . Yes. And wayne, i also saw you made a bet with colleagues, is it, about the dow going to 20,000 back at 16,000 . What dgives you room for optimim here . I looked at the dow at the three year, five year, tenyear perspective and thought that things are tough now and tough for mainly for circumstances that have nothing really do to do with the overall market per se. Theres chinas currency. It was oil. And, you know, many cyclical items. I thought once thats down and over with well see upside. All right. We got to go, guys. Good do see you both. Continued success with your portfolios. Appreciate it. Thank you. Thank you for the opportunity. It was a pleasure. You bet. Yep. We love the perspective from main street. We do it once a month on the last trading day of the month. 20 minutes to go here. The nasdaq closing out a pretty good month, up 7 points right now. Concerns over the zika virus are reaching new heights here in the u. S. With four new cases in florida. Now raising the chance that some u. S. Mosquitos are carrying the virus. Well look at the potential defenses coming up. 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Fresh ingredients, stepbystep recipies, delivered to your door for less than 9 a meal. Get 30 off your first delivery blueapron. Com cook. My m. About my toothpasteice. She eveand mouthwash. Ice. But shes a dentist so. I kind of have to listen. She said jen, go pro with crest prohealth advanced. Advance to healthier gums. And stronger teeth from day one. Using crest toothpaste and mouthwash makes my. Whole mouth feel awesome. And my teeth are stronger too. Crestpro health advanced. Is superior to colgate total. In these 5 areas dentists check. This check up . So good. Go pro with crest prohealth advanced. Moms right. Again welcome back. Lets send it over to seema modi. A tech stock Hp Enterprise shares, coming off the highs on a report by reuters saying buyout firms are looking to buy certain assets for roughly 6 billion to 8 billion following an earlier report today saying private equity looking to buy as a whole for roughly 40 billion. But again, according to this reuters report, buyout firms focused on Certain Software assets of hewlettpackard. We are looking at the stock. Still up, though, about 3. 7 on the day, bill. Manageable size. 40 billion would be a lot obviously. But if they were to come together they could have culled it off. Well see how it plays out here. Thank you. Check out the bio techs for month of july. Always a volatile sector. Comeback mode for a lot of these. Amgen up 14. 5 . Biogeun 21. 3 . Zika virus was a source of concern for americans heading to Rio De Janeiro for the olympics but as of this morning, it is americans across the southern part of the country paying much closer attention. Meg terrell with the latest on the spread. Meg . Thats right. Today cdc and the Florida Department of health saying we have four cases of locally transmitted zika virus here in the United States via mosquito. This is the first local transmission in u. S. States by the mosquito and the cdc says throughout the summer months we could expect to see more cases. Now, we do have the two mosquitos that transmit the zi covirus in the United States. You can see here we have a map. The one you see in blue there and then yellow, the main transmitter of the zika virus. We have seen the four cases in a very small area of miami. And of course, we have heard that president obama has been briefed on this situation. And he is, the white house still talking about the funding fight here. Take a listen to press conference earlier. Congress has been sitting on a 1. 9 billion proposal that would fund more fully fund federal response to this Public Health emergency. Unfortunately, they left town for seven weeks. Without doing anything on this. We find that regrettable. Todays news should be a wakeup call to congress to get back to work. The fight continues over funding. Meantime, the department of health in florida going door to door spraying, being vigilant telling everybody to protect themselves from zika. What are the latest prospects of a vaccine . There are several efforts going on and within the government and industry. We know that santa fe working with the government and glaxosmithkline is in and smaller drug and vaccine makers and however it will be several years before we have anything that could potentially work. You know, i heard a report the other day, i was only listening with half an ear on the radio, but somebody did a study of the potential spread of zika as a result of the olympics and they were down playing the possibility that this becomes, you know, a huge spread as a result of all the people going to rio and then going home again. What are you hearing about all of that right now getting read did it for the olympics a week from today . Thats correct, bill. Theres analysis as a result of the olympics. The World Health Organization looked into this closely and didnt recommend any change to the timing or the location of the games as a result of this. Studies looking into this show that most of the countries and the people traveling to the olympics, they already have people coming back, its not going to increase the chances of spreading around the globe. There was one report that identified four countries that they dont have a travel between the areas and in general not expected to increase the spread beyond where it would already be. Thank you for now. Thats meg tirrell. Ten minutes to go in the session here. The dow down a point now. Well, because our art cashin pointed out that the market on close orders are 600 million to buy today. Again, the end of the month. Last trading day here and maybe seeing demand. S p up 6 1 2 points and flirting with alltime high and the nasdaq up 13. David is hitting the links for the market acronym and tee it up for us when we come back. 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But golf stands far. First as the gdp numbers came in a bit light for the first half now. 1. 2 for the Second Quarter after. 8 . I was concerned by the last five quarters revised downward and the benchmark revisions that the department of commerce does do. The o is oil price. You have the keep your eye on that. Its been slipping. Fallen 20 since june the 8th at 51. Opposite of that means when the dollars too strong, the oil is weak and also supplydemand. L, lethargic markets. Oh, an adjective. Lethargic markets and volatility and lethargic profits from the greek word or forgetfulness. Okay . F, the fed and japan are on hold right now and the holds kind of would like to have seen more out of japan. They promised more and they keep promising like a child being held candy in front of them and pulled back. Reiterate what i said last week. Reduce. In europe and japan and add to small and mid cap u. S. Equities. And add to emerging markets which have been doing well as kelly pointed out last week. Be very selective in Real Estate Investment trust. Mass limited partnerships, energy and anything else youre pursuing for yield. Make sure that the yield is maintained. Can i ask you something . Is it fine to swim in the hudson river . How many times people say, no, theyre not swimming in the river. Its better than it used to be. Its the cleanest its been in 30 years. They do all kinds of tests. The new York City Department of environmental protection. You do you have been urged not to swallow too much water. I will say that. Right. But it feels really good and helps you, kelly. The fastest mile you swim is in the hudson river. It takes about 20 minutes to 22 minutes whereas normal mile is much more than this. They shortened the bicycle ride. The run was cut from 8k to 6k, 10k to 8k, bill. Im tempted to jump in the ho hudson and swim myself. I bow to your effort. You can wear that tie today. Yes. Thank you very much. Thank you. Have a good weekend. The dows down 20 points heading to the close, closing countdown and a recap of various markets an enhow do they this month. A recap of the speech last night in her acceptance speech, nominee Hillary Clinton took aim at wall street. But one of the shots missed the target in its accuracy. Well explain coming up. Hi daddy gain the freedom to fumble with the new water and shatterresistant Samsung Galaxy s7 active. Buy one now and get the samsung gear s2 for free. Exclusively at at t. Will your business be ready when growth presents itself . Our new cocktail bitters were doing well, but after one tradeshow, we took off. All i could think about was our deadlines racing towards us. A loan would take too long. We needed money, now. My amex card helped me buy the ingredients to fill the orders. Opportunities dont wait around, so you have to be ready for them. Find out how American Express cards and services can help prepare you for growth at open. Com. Find out how American Express cards and Services Andrea sikon. Medical doctor from cleveland clinic, watson, lets review the Electronic Medical record of the next patient. No problem. Its a pretty huge file. Done. Sorry for the wait. That was quick. As part of our research, i also compared lab results with notes about prior treatments, then cross referenced it with thousands of medical journals. And i get the benefit of much more data, and a lot more time to plan the best treatments. I stay focused 24 7 and never sleep. You sound like a lot of medical students i know. All right. 90 seconds, we are running late. Let me show you for the month closing out here on the countdown with bob pisani, as well. Pretty good month. Thank you, brexit selloff. That was a comeback month. July traditionally best of the quarter. 8 gain plus for the nasdaq for the month. The dollar index and then the two big commodities, can be affected, wti price of oil which collapsed this month was down 20 at one time. Down 16 here. Gold had a pretty good month, up 2. 4 . How about today . Historic high. Intraday. Boy. Flirting with a you willtime high for the s p right now. With right on it. Intraday on it. We made it alltime. Lousy gdp. Lousy oil again today. Lousy exxon and chevron numbers. You know, in spite of that, still at a new high. I think thats rather remarkable. Resilient i think is the word. Whatever you want to call it. Remarkable. Thanks, bob. Dow down 14 points but the s p looks boy, very close. Its a squeaker. Well let kelly decide if its an alltime high. Doesnt look like it will be. Ciner is ringing the bell. Long island iced Tea Corporation at the nasdaq. Have a good week, kelly. Long island ice Tea Corporation . Welcome to the closing bell, everybody. Im kelly evans. Finishing the day, the week and the monthment the dow with a drop of 26 points today and the s p up 3 to 2173. Nasdaq up 7 to 5162. Strong month for the equity markets and a tale of two halves of the month. Different trends in the first half and then the back half. Thats in a moment and set to digest results of largest banks of europe. We will have complete coverage of that data coming up. On todays panel, senior markets commentator mike santoli and evan newmark on a friday. For more, Oliver Porsche and david seeburg. Mike, what are your thoughts about the month of july . Today was a good representation of the second half of the month. You had an extremely narrow range and basically shuttled through that range every day of less than 1 and then the high end and today we did settle just about at the high of the last half of the month and no big macro factors to get a catalyst to basically move us out of that range and then offsetting moves with the corporate earnings being reported. All that stuff in play. Today, the disappointing gdp number and what happens then . Bondlike stocks to support things. Thats been the story today on one day or another. One sector or another is helping out. Lets get to bob pisani on the floor with a recap of the month that was. July is traditionally the best of the third quarter. We dont know the other two and so far its turning out pretty well. Take a lock at the major indices right now and interestingly small caps like the russell and the mid cap better than the s p 500 overall. Still pretty good month for all three major indices. In terms of sectors, tech did the best and health care and materials towards the end of the month and the dollar weakness helped a little bit. Consumer staples, old leader didnt do much and theres the problem with energy down 2 overall and who could blame them when crude kept dropping in the second half. Look at that, down 14 for the month. Thats going to have a big impact on oil Company Earnings in the second half if it doesnt turn around very quickly. Another issue was the dollar and we couldnt figure out what direction it was going. It rose in the early part of the month and now dropping rather quickly in the last few days. Particularly today with the poor gdp numbers. Overall, s p 500, all of the gains in the first two weeks of the month and sideways for a long period. More than ten days and extremely narrow Trading Volume typically light. August, of course, a tough month overall. Guys, back the you. All right. Thank you. The other big moves we saw in markets this month, how about commodities . Jackie has more on that one for us. Good afternoon to you, kelly. Start with a onemonth chart of oil to see what happened here. The chart is ugly. Near 17 decline for wti and dipped into the bear technical territory. 20 drop yesterday we saw from oils earlier high in june. So why did oil fall out of bed . Well, because we focused on supply demand fundamentals and once again the story doesnt make sense. There is still an oil glut out there and that oil glut was a gasoline glut because the refiners produced too much gas. Meantime, demand strong this summer and not Strong Enough to work through all of that excess supply. It was good news for consumers. Now the average is 2. 14. Not great news as bob pointed out for the oil majors. Reporting that they had a tough time in the Second Quarter and remember oil prices were higher so this is something to watch. The turn around today certainly because of that weaker dollar. We started off really weak and then finish in positive territory. Meantime, gold prices totally different story. For the month, a little bit of a pop 2. 5 and today we closed over 1350. A lot of people were wondering postbrexit to hold on to the gains we saw in gold. In fact, we are. A twoprong analysis and safe haven trade still on the table and second piece, that weak gdp number today got enthusiasts back into gold and people believe that the fed will be dovish and components looking at commodities and moved in opposite directions in terms of metals and the energy sector. Thats true, too. Another quirk. Thank you. Evan, what are you doing with these markets . Not much. I mean, not much at all. I mean, basically, i still continue to believe that you will not see a breakout in the equity markets until the bond yields rise and a pop of the financials. Doesnt look like thats happening any time soon. And so its hard to be super bullish about the market. It is not saying that the market will drop precipitously or the end of the world but you really financials have been laggards and now energy is weak even after a strong kind of tail end to the First Quarter. And now, youre kind of in a wait and see mode to see whether or not you get Stronger Economic growth and with that youll get strong earnings and a pop in the market. It all seems to hang together and why the gdp is investment and oil and energy and mining horrible. So, you know, we are watching the oil price and helps consumers i guess. But the bigger effect is the way in which its hampered things. I think that the consumer story is overplayed in terms of impact of oil or gasoline prices and didnt seen a big change in Consumer Behavior as a result of the lower gasoline prices and not a difference maker. I look at this environment. To kind of piggyback on davids theme of sports, it is like a nfl fan and saying that my team is tied for first right now. Yes, it is. Technically because no games have been played yet. You know, august is going to be tough. It is about earnings, Economic Growth and its about really changing policy so that the Federal Reserve and other Central Banks can finally take their foot off the gas. What do you mean changing policy . What happens in washington with the election . Washington or europe or pick any spot in the world really. There seems to be kind of an absence of leadership all around. You look at brexit. There was a selloff. A bounce back. Yeah. Its a geopolitical event, fine. Look at europe. It is a mess across the board. Yeah. Were not exactly, you know, doing great in washington, d. C. Here so i think until that changes the fed and other Central Banks will have to keep providing liquidity. Shortterm stimulus of nine years and the picture stays the same. David, this morning, so interesting to see exxon and chevrons numbers. You know, look. Exxon missed by 20 cents on the bottom line. The cash flow is short of what was expected. Borrowing and i think vanguard just kind of stopped taking new money into its Dividend Fund and the thing is ballooned. So at what point is this piling into the dividend names too overdone . I feel like its the point, kelly. We talked about it in the show here. Theres nothing i really love on the tape at all. Especially look at the dividend, the move is unrealistic. I think that im a seller pretty much across the board of the names that have traded up on that fact alone. I look at relative value trades in the market. Look at the biotechs. It is the headwind of political outcome there but ultimately look at the large cap names. Most of them already reported. You starting to see the sector trade better. I think you can trade some of these names that have not necessarily performed on the upside with the overall market or other sectors and do pretty well and bio tech, large cap bio tech to buy here and look at the banks and continue to trade. I play them from the short side right now because i think youre probably going to see a pullback in the banks. I think theyre also vehicles to trade. Thats not going to help if youre shorting the banks, doesnt get evans bull case going here. I think its an interesting phase right now because we are at the phase where people have come to the realization albeit it quite late, the Central Banks are more or less done. If youre waiting for the bank of japan to do helicopter money and when that happens it wont solve the fundamental underlying issues which are structural, related to fiscal side. I think its a good thing the markets coming the realization and it can take six months to a year to figure it out. Coming to the yield trade, global rush for yield, this stuff can go on a long time. So it already has in come ways. Crowded and people valuing the stocks based on yield, that is true and doesnt mean its about to stop. You have to have a bear case before that trade stops. Interesting thing is especially doesnt have to stop if the what its all based off, 10year u. S. Yield is moving lower and the fact its down to 1. 45, a little bit off the record lows tells you people say i can get 10 in the places way overvalued. The 10year treasury yield up to 1. 75 at least doesnt up end that dividend name. Theyre messy and crowded with coke and mcdonalds and exxon and they lose multiple years worth of dividends but if all you care about is the coupon, you are fine with that. If all you care sabt the coupon. I agree and say as an investor i dont want to jump in buy the stock. Id prefer to buy a celgen and basically great guidance to 20 grower and the stocks cheap. I look at names like that and say those are the names to buy right now and much more comfortable believing in the fundamentals. Only thing thats a wild card there is an issue with Political Uncertainty and thats a head wind and i dont think its necessarily going to derail these names any longer than they have gone. I think theres only upside in stocks like that right now. Yeah. Just to be i mean, shouldnt need to be said but you can do both. You can own dividend stocks and gret. Exactly. Correct. Look. We like dividends. But everybodys absolutely right. It is getting more expensive and so you have to be very disciplined and dont want to yield shop right now. From your experience, are investors buying fixed income for the Capital Gains as well as not anymore. The flows. We havent seen that in a while. I think everybody has been wrong incidentally and a kind look of the bond trade in terms of Capital Gains and bought it to moderate volatility as a heendg. What investors are still doing is chasing yield. Theyre seeing something with a 5 or 6 yield and automatically saying that sounds good. Must be a great investment. Must be a great investment. We think the 3 to 4 range is relatively safe and gives you a buffer of a correction and there will be a correction. Theres no question about it. The difference is that, you know, theres probably a hard case to make for prolonged or deep recession or correction in the market because of the liquidity and correction and no place else to go. You have the Pension Funds way underperform thinking maybe time to creep back into the stock. Thats where the blowup will be. Theres no way the Pension Funds are hitting the 7 target. God no. David, well let you go. Oliver, appreciate you joining us here, as well. Theres more coming up on fast money. And which stocks could be particularly vulnerable. Thats top of next hour. Now European Bank stress test results are next and what they mean for the financial world and the global economy. Plus, the economy growing. 1. 2 in the Second Quarter. Well discuss whether that helps Hillary Clinton or donald trump more in the polls later on. Youre watching cnbc, first in business worldwide. At the Marine Mammal center, the environment is everything. We want to do our very best for each and every animal, and we want to operate a sustainable facility. And pg e has been a partner helping us to achieve that. Weve helped the Marine Mammal center go solar, install electric vehicle charging stations, and become more energy efficient. Pg e has allowed us to be the most Sustainable Organization we can be. Any time you help a customer, its a really good feeling. Its especially so when its a customer thats doing such good and important work for the environment. Together, were building a better california. Welcome back. As we close out the month of july that sell in may and go away strategy isnt working. S p up about 4 since the beginning of june. But august may bring roadblocks to the rally. Seema . July really strong month for stocks not just in the u. S. But around the world. S p 500 gaining more than 5 . The european stocks index up about 6 . And china up, too, especially after before you pack your bags for the hamptons, experts say theres several factors do derail stocks in august. First, being oil. Dipping into bear market territory adding more pressure on Oil Companies and refineries that may have thought the worst is over and even though theres no fed meeting in the u. S. , central bankers from the world will be in jackson hole summit and grappling with issues like how to stimulate growth with Interest Rates near 0 and fears of britains separation of the european union. Yes, the brexit. Meeting next thursday, Governor Carney is expected to cut rates and what the market is really focused is bank of englands new Economic Forecast which will offer investors a potentially bleak juoutlook and keep an eyen fed fund futures as expectations likely ride for a september rate hike and a lot to look forward to in the month of august, kelly. Thank you. I wonder to what extent the gdp numbers, back ward looking and not that market sensitive but if the first half is 1 average, how can the fed raise Interest Rates . Dont you think it pushes this out . This is higher. The consumer piece of gdp actually okay. You could say nominal gdp growth including inflation is 3. 5 . Not terrible and not pushing the fed. You need a strong jobs number in a week for that to be a realistic possibility. The weird possibility and i dont know if it comes to pass is the you get inflation popping and you have weak growth. Theres a classic scenario which is like the worst of both worlds and that im not saying it will happen. Thats what you have to be looked at in terms of prices and without the gdp growth. Listen. With Everything Else thats happening, the core inflation index is moving back up into the 2 range. But the wage stuff still isnt showing that, you know, really going to move upwards significant way. Im expecting, you know, either donald trump or Hillary Clinton to come out with the, you know, debt is so cheap to give more money, raises for everybody kind of thing and very possible in a coming collection cycle. You are seeing, you know, the intellectual types talk about universal basic income. Unearned income tax. Yeah. All these things. Unearned tax credit. Exactly. We have the results of European Bank stress tests and getting to them after this. R want to see [ beep ] but youll be glad to see it here. Fidelity where smarter investors will always be. 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European Banking Authority releasing the latest stress test results. Wilfred frost has the results. It was as expected. Cet ratio, the crucial measure, going to negative 2. 5 . In the adverse scenario. So quite extraordinary how poor their Capital Position was and thats why theres been this pressure to secure the private bailout which they did do earlier today and confirmed by the ecb and the board of bmps. If they hadnt, we would be see all hell break loose on the stock and probably other italian banks, too. Uni credit didnt do particularly well. Fourth worst and 7. 1 and not a terrible position. Below 8 as a leeway area and not the 5. 5 which used to be the barrier of a pass fail mark. Who deteriorated the worst from the starting point to the adverse scenario, after bmps, allied irish. They were on 4. 3 and not very good and not a huge bank in that sense. Rbs and barclays, they saw big deterioration of standard positioning to the adverse scenario being applied ending up on around 8 and 7 respectively. So not fantastic. But again. Thats the adverse scenario. Bmps worst and then austria, spain, uni credit in italy and big names, barclays and rbs and fine. Deutsch bank focused on heavily is all right. 7. 8 , below the 8 and still got a lot of work to do on the capital but probably not immediately and they were stronger than 2014 and this years exercise was demanding he said and he said by 2018 would be at a ratio of 12. 5 . French central bank said that the stress test confirms french banks are safe. I thought you would say awesome or something. Stay right there. Sarah hunt, Portfolio Manager at alpine funds. Charlie is vice chairma at ariel investments. What do you think of the results, charlie . Well, you just theres too much risk to be investing in these names. They just dont represent a good risk reward tradeoff. Clearly the European Bank authorities dont want to send a signal that theyre real problems in the system. There are, in particular in italy. We have got a Euro Currency that doesnt work because countries like italy cant cut their currency to invigorate their economies and so you have got nonperforming loans in europe that by one measure passed the 1 trillion mark today so its a very difficult banking environment with stocks to look cheap and dont represent value on a risk reward basis. Sarah, what did this accomplish these results if anything . To your point earlier, we needed to make sure there that there was a solution before it came out and they were the closest to the wire here and in fact it was pretty bad for them. I think what it accomplishes is trying to put confidence in the system but i think that you are still looking at an enormous amount of stress and didnt look at a flat rate environment which we actually have. So rising Interest Rates is good for them and that to me is not that stressful compared and negative Interest Rates so i think i agree. Its a tough space to be in right now and i think you need to understand what youre getting into and thats tough. I have a question, sarah. What does mario draghi take away from this . Well, doing a great job with the negative rates . Ceo of basically every European Bank begging him to change the Interest Rate policy, why is he going to be insistent on continuing through and keeping rates so low many. I dont know. We are talking about it like its okay and normal to me is very bizarrement its incredibly difficult for anyone to understand what to do. Fixed income is tremendous amount of pressure. It doesnt matter that rates are negative. I think that does not make a lot of sense in this situation and a reason the banks are screaming because think near a lot of pain and i dont see why going further down a road that has not yet been particularly fruitful seems like a great idea. Like a greater fool theory and the fool is the government i guess if theyre the ones doing the buying. Yeah. Precisely. The ecb is hard to come out of negative rates at the moment with other implications for the economy. The main takeaway for me is disaster is averted because bmps found a bailout and looking at deutsch bank to raise capital and not forced on monday morning and so hard to build capital from the position theyre in. Book value is around 0. 3 and unbelievable going to the market again and returns close to zero. Made 20 Million Euros and hardly making any profit and not growing to a Bigger Capital base and goliath and losing market share and self fulfilling and the clients see theyre not as powerful and putting the trade elsewhere and hard to see how they stop the rot. I dont think its a situation on monday where the banks sell off and doesnt solve the issue. Not making money. The capital is weak and theyre trading at such low levels and raising capital is dillutive. The shares of deutsch rally slightly, slightly on the shares. Publicly traded stock of deutsch bank is the stub end of the institution and dwarfed by the balance sheet. The banks will be continuing the try to accrue capital, raise capital. Really not be net contributors to growth and sitting there trying to shore up the balance sheet. Charlie, is there anything to add to that in terms of economic fallout for the euro zone result of this . Only thing to pile on and say by the way Bernie Sanders and Elizabeth Warren are running the governments in europe and even worse Regulatory Environment in europe than it is in the europe. On that note, thank you. Charlie, sarah, wilfred, thank you. Catch the interview jamie dimon 1 00 p. M. Eastern time. Any hints, questions . Compare and contrast. Europes terribly. America, the last set of results and the stress test results actually pretty encouraging and a bit of politics and brexit. Yeah. We remember that dimon bottom. Thank you. Time now for a cnbc news update. Lets get to sue herrera. Sue . Heres whats happening this hour. Hillary clinton and running mate tim kaine with a rally in philadelphia. And kicking off a threeday bus tour across battleground states. A crowd of more than 5,000 gathered at Temple University to see them off. It is official. The Obama Foundation formally announcing that its chosen jackson park as the chicago location for Barack Obamas president ial library. The decision leaked earlier this week. Jackson park is located on chicagos south side. The daughter of former Vice President al gore was in court today. Karenna gore arrested for trying to Block Construction of a pipeline in boston last month. She pleaded not guilty to misdemeanor charges. Hormel foods is turning 125 years old this year. And has been celebrating the event this week in austin. There you go. Ribbon cutting ceremony because its the new spam museum. Downtown. It is attracted thousands of visitors since its soft opening back in april. Look at all that spam. Not the email kind. I dont know if we needed to see that. We should have just stuck with the spam cans. I agree but these days they could add display of ji northeastern princes for a great investment or something. Thats right. They could. Youre planning a road trip. Look. Its one of the many things that makes america great. I agree. Spam. Is that you can have a spam museum and people actually go. I think we all should. Taking closing bell and sue herrera to the spam museum. Have a great weekend. You, too. Thanks. It wasnt long ago to see falloff of the socalled fang stocks but facebook, amazon, netflix and alphabet are baring their teeth again. Speaking of amazon, announcing to double down on the streaming video investments. Find out if that helps them win the streaming wars when we come back. Er food . Is that a real thing . Its a great school, but is it the right the one for her . Is this really any better than the one you got last year . If we consolidate suppliers whats the savings there . So should we go with the 467 horsepower . Or is a 423 enough . Good question. You ask a lot of good questions. I think we should move you into our new fund. Ok. Sure. But are you asking enough about how your wealth is managed . Wealth management, at charles schwab. Intenselyflavored. Colorfullydiverse. Beautifullymisshapen. Cultivated for generations, its the unexpected hero of any dish. When you cook with incredible ingredients. You make incredible meals. Fresh ingredients. Stepbysteprecipes. Delivered to your door, for less than 9 a meal. Get 30 off your first delivery blueapron. Com cook. Welcome back. Heres how we finished on wall street. Dow down 24 duh the s p up 3. 5 and traded intraday alltime high. The nasdaq up 7 points to close out the month. And the socalled fang stocks back with a bang over the past week. Dominic chu is here with the rally and whether it will last. This is a management story and take a look at those fang stocks because are they back . Theyve come back with this vengeance so far this week. Facebook shares, we know great earnings report. Up 3 week to date. Amazon up 1. 5 . Netflix up 6 and Alphabet Google up. Beating the 13500. Can we really say theyre back . Yes, they have had a nice run. Take a look at this. Year to date basis, right . We can see facebook shares, yes, very strong performance. Near record highs. 19 to the upside. Amazon up 13. But net flick shed one fifth of the value year to date. Alphabet up 3 and s p up overall 6 . If you take a look at whether fang stocks outperformed the market. We said what if at the end of last year beginning of this year you put equal dollar amounts in each one of those stocks, facebook, amazon, netflix and google. That portfolio would be up about 4. 3 year to date. Meanwhile, the s p 500 etf up about 6. 5 and the index prevails but, guys, always a story of stock picking. If you would have just, kelly, gang, left netflix out, hypothetically, with that monday morning quarterback back then and left it out your year to date performance on an equal weighted basis would have been up 12 in that period. Nearly three times what the return was for the overall fang and interesting story of whether stock picking works or indexing. Maybe a bit of both. Not too shabby and netflix is left out. Thank you, dominic. Amazon cfo announcing last night the company doubling the investment in video as the competition with netflix heats up. How does the video streaming space compare . Lets bring in tom forte. Listen, im a prime member. I looked through the Video Library and very underwhelmed. Wheres this all headed . Whats the significance of Amazon Instant Video . Another way to get consumers to join the prime Membership Service but also to retain members on its prime shipping offering. So i think videos important. The fact to ramp up the investment spend suggests that it is an effective vehicle for them to attract new members to prime and also retain members and when you think about it on a global basis, now rolling out the instant video effort in india and indias probably the most important emerging market. I wonder, though, coming to the reports that amazons spinning out this video service, right, tom . Arent they trying to offer it on a standalone basis . They would have to make sure that the offerings are competitive. I think investing in video content is something thats very important to the company to the extent that in addition to having the benefits of more people to sign up for prime membership if they do have an offering thats compelling then youre right. You could offer a compelling standloan offering like netflix. Clearly you are seeing an advancement in the over the top video space with a lot of players in there. And i do think theres an opportunity for amazon and whens being lost in the shuffle is starting to roll out movies on a small basis and i think that could provide more upside to the instant video efforts. Sure. You know, tom, it is not an original observation to say that obviously the overall cost of content is going to be going up the therefore. If they dont need it to be profitable probably bad news for netflix and good news for content providers . I think great time to be a brated actor basically, yeah. If youre looking for a job and looking for, you know, you have a yao neek idea, theres a lot of people netflix, amazon in the content business and acquiring content. I think netflix and i dont formally cover the company, theres enough room in the category and netflix with house of cards, orange is the new black, theyll continue to drive subscription growth there, as well. It is a great time to be a bactor or a unique actor of video content. Tom, its evan. I have a question about the space in general. And being a user. Which is, where is the competitive advantage arising for any of these individual companies . For amazon, for example . I use all the services and as kelly noted, you know, sometimes amazon just doesnt have the product or the content this im looking for. Ill go two to three months without any amazon content and netflix or hulu or elsewhere. What gives amazon a distinct advantage other than a cheaper alternative with the prime connect for consumers . Sure. Definitely ties into the view of the convergence of technology of retail. You can have the best technology in the world, without a good product it doesnt matter. So think of netflix without house of cards or orange is the new black and only movies not necessarily the best run movies and amazons in the same position and argue for amazon most popular is man in the high castle and transparency. Right. I think that they do a really good job of making easy to find content on the amazon fire tv device but if they dont have Quality Content then it doesnt matter how good the technology is and i think the sames true for video. I look into acting. Seems like its never easier to break in. Tom, thank you for joining us. My pleasure. By the way, an 825 price target on amazon. Nominee Hillary Clinton talking tough about wall street last night during her acceptance speech. Its wrong to take tax breaks with one hand and give out pink slips with the other. And i believe wall street can never, ever be allowed to wreck main street again. Well discuss whether this will help her attract disgrun e disgruntled Bernie Sanders supporters in a moment. We have a look at one startup thats beating the competition when it comes to kickboxing gloves and gear and tailored to women. Looks like fun. Stay with us. Guyhey nicole, happening here . This is my new alert system for whenever anything happens in the market. Kids a natural. But thinkorswim already lets you create custom alerts for all the things that are important to you. Shhh. Alerts on anything at all . Not only that, you can act on that opportunity with just one tap right from the alert. Wow, i guess we dont need the kid anymore. Custom alerts on thinkorswim. Only at td ameritrade. Welcome back. Another Democratic Party committee is victim of a hack attack. Eamon javers has more. Eamon . Yeah, hi, kelly. The arm of the Democratic Party that raises money and strategizes for house of representatives campaigns and earlier today officials there acknowledged they have been swept up in this broader hack attack against the Democratic National committee. Heres what officials at the dccc said earlier today. The investigation is ongoing. We have been advised by investigators that this is similar to other recent incidents including the dnc breach. Now, i have been talking to folks at fire eye, a Cyber Security Company Looking into this. Heres the findings they gave me about this particular incident at the dccc saying that the hackers redirected traffic to an act blues domain and one letter off from the campaign for money to the dccc and there hackers could gather information about the Democratic Party donors and didnt steal money and thats what makes investigators think its likely russian intelligence gathering information, not a criminal gang stealing money. They say it was active from at least june 19th to 27th and they say this was part of the same russian Hacking Group of the czar team thats been active in the past several years in russian intelligence type activities saying that all of the targets have been targets that share that are that coincide, excuse me, with the russian governments intelligence activities so this is something that theyre very worried about saying one of the big concerns is what could the Russian Intelligence Service do to disrupt u. S. Elections going into november, kelly. The czar team. Wow. Okay. Thank you. Thats eamon jav earls in washington. Lets look at another money issue. In her acceptance speech last night Hillary Clinton took a page out of the Bernie Sanders playbook. Wall street, corporations and the super rich are going to start paying their fair share of taxes. This is this is not because we resent success. But when more than 90 of the gains have gone to the top 1 , thats where the money is. Well, the Washington Post fact check reports 90 recently 2012, the top 1 with 52 of income growth. For more on how it plays out on the campaign trail, were joined by larry kudlow and david mori. A former adviser to president obama. Welcome, guys. Larry, its funny because part of Hillary Clintons speech last night was also saying and chelseas that facts are stubborn things. Does it matter on this one that, not quite . Well, look. Im not sure what youre asking here but mrs. Clinton has moved to the left, way to the left of how her husband governed 20 years ago. Entirely different Democratic Party. I would just say this for start earls, kelly. Our economy right now, you saw the numbers this morning. Is perilously close to a recession. And that comes inside of an expansion that was 2 , one of the weakest on records. So therefore, you have to scratch your head and ask, if we are close to recession, if we have had stagnant wages for all of these years, if employment is sub par, why would you be raising taxes . Why would you be worried about inequality and redistribution . What you want is to promote Economic Growth by tearing down tax and regulatory barriers and energy and most particularly you know my hobby horse. Single best thing to do is reform and slash Corporate Tax rates which mr. Trump supports. Now, i know hillarys economists and theyre in favor of Corporate Tax reform. It is hugely progrowth. I dont know why and why she is not going out there with it. David . Well, i agree with larry on that point and i think she should. Let me step back on the 1 controlling 90 of the wealth. Thats mostly true. I think it needs context and updating. It was a nod to Bernie Sanders as larry was implying and uniting the Democratic Party. The big question in my mind is, you know, whens the disrupter here . Whos the turnaround ceo . I think she made the case persuasively not necessarily donald trump. We have Leadership Campaign and jim collins books argue the turnaround ceo to be steady, specific focused. You know, opposed to flashy and ultra bold. Hillary clinton tried to make that case and i think was persuasive. On the final point of reforming taxes, i agree and part of the clinton agenda. Cant be slashing taxes because the question that we should ask larry and the trump campaign, is where does the money come from . Reforming taxes. Larry . Fair enough. Look. Trumps revised plan, tweaked plan to come out in a little while. Thats not the subject of today. But mrs. Clinton has a lot of spending. Okay . A lot of spending proposals. And i just want to say that if you spend more and spend more on all of these areas, you think raising taxes on rich people is going to finance it. It wont. The studies show when you raise tax rates, particularly on the upper income people who are after all investors, you dont make hardly any money from that. What you are doing is punishing success. Now, i want to say to david, you may be right. I dont want to argue about it but i just say that trump is a new guy on the block. Hillarys been around for 25, 30 years. This is not meant as a personal criticism. I dont know her. Okay . But trump is the disrupter. Trump is the change agent. I think its tough to make hillary the change agent because shes been in the establishment so long. Mr. Trump may not do everything right. I get that. But if you look at the speech he gave a week ago, he walked through tax reform and Regulatory Reform and energy and health care reform. He had a lot of meat on those bones with more coming. I just think, tell you the truth right now, i think it is his to lose. He may lose it and his to lose because as you noted this is a change election. I just think its tough for mrs. Clinton to be the change agent. All right. Larry kudlow, david mori, thank you for joining us. Thank you. Kate rogers taking names and kicking some heavy bags. Accommodating up, a look at one red hot startup targeting women in combat sports like kickboxing. You dont want to miss this hardhitting report. A good car has to maneuver quickly. Thats also true of a good car company. People have always bought cars. But we saw an opportunity in sharing cars. So we moved fast and launched car2go in 29 cities, all around the world. Doing that required dozens of data centers, designed for speed and performance. We built our business on the ibm cloud. Because thats what the ibm cloud is built for. Bolstered by a culture of health and fitness, Portland Oregon start up scene is giving small u business sz a foundation for growth. A look at one Company Fighting for a share of the womens athletic market. Hi, kelly. Tha right. Were here in beautiful portland, where lynn lee first got her big idea for her business while teaching kick boxing. She noticed a common problem among female fighters, that none of their gear fit properly. Its community im passionate and about these Women Deserve their athleticism, deserves respect and the way to get to that point is by saying to them, you deserve products just as good as mens. Now, in spired by nearby power houses like nike, adidas and columbia, she set out to design gloves that fit women properly along with a clothing line. In neon hot pinks and really shiny spandex. Theres a really Strong Community of fostering local artie sans, businesses. And so, between that type of comradery as well as the Work Life Balance and the environment, you lead that with the sport innovation culture, its really a hard place to beat. Now, she took that message worldwide in 2015 on kick starter. Something about 50,000 woth of products at this point. Today, shes selling in local gyms around the country and so far, theyve raised under half a Million Dollars in funding so far. And as you guys can can see, i got out a lot of my aggression on that shoot. Im a very, very novice kick boxer, but the gloves fit me better than the ones i typically use in the gym, but those women were very, very tough and not people id want to get in the ring with soon. Nor would i want to get in there with you. You are no novice. Ive tried boking. It was more like a noodle dance. That was fantastic. Kate rogers in portland, oregon. Thank you. Breaking news on another hack. Sima actually, amon. I just told you about the hack into the Democratic National campaign. Reuters crossing the wire with a new story saying the Clinton Campaign has been hacked. Hackers breach ed the Computer Network. Theyre citing sources with knowledge of the investigation. Reuters also saying here that the u. S. Department of Justice National Security Division is investigating whether cyber hacking attacks on Democratic Political organizations threatened u. S. Security according to sources familiar with the matter, talking to reuters. I just talked with the department of justice. For now, they are having no comment on that, but this is part of a much larger story here. The hacking of Democratic Political organizations across the board. I can tell you, that ive talked to cybersecurity experts about this today who say they are looking for evidence that republicans were also hacked. They assume that the Republican Party apparatus has been attacked in a similar way. They say they found the evidence of that yet, but reuters reporting that hackers have breached the Clinton Campaign Computer Network as well. To be clear because theres so many of these, is the news here that they hacked into Clinton Campaign computers campaign itself. Thats the first time this has been reported. Right. What we knew was that the Democratic National committee had been hacked. Thats where we saw the embarrassing emails that led to the fall of the chair over the weekend. Then we saw the Democratic Congressional committee, the House Organization and now, the Clinton Campaign itself. So, three separate organizations all within the broad Democratic Party apparatus here in washington. Thank you. Past the midway point of earnings season. We get another huge batch of results next week. Heres a look. It features tesla, viacom, aig, proctor and gamble, ccs. A preview, next. And come monday, dont miss the exclusive interview with jamie dimon, monday at 1 00 p. M. Eastern on power lunch. Tmobile covers your business in more places. So you can take your business just about anywhere. Plus, our extended range lte reaches twice as far and its 4x better in buldings. Get more done in more places. Switch your business to tmobile work today. Theres a lot of places you never want to see 7. 95. 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And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Its time to bench the benchmarks. Welcome back. Next week, another big week of earnings. A bunch of different names on tap. Mike . Going to watch a handful f those defensive stocks. P and g right there kraft. We talk about this pattern of this crowded trade and just see if the feundamentals matter. Better than expected across the board and second half guidance looks okay. Its more about macro jobs. What are you watching . Going to look at the bond market. I really think the bond market and the currency market rs really whats happening with the equity market. Whatever goes on there, the natural addons are on to the equity market. Again, tenyear Interest Rate. Still here all time lows. Guys, thank you so much for joining me. And for the month of july. Mike and evan. That does it for us on closing bell. Fast money begins now. Kelly evans was spot on. Fast money begins now. Im brian sullivan. Melissa lee is back next week. Tonight, major headlines from the European Bank stress test. They are moving stocks at this hour. Its not just amazon surging to record highs. A number of actual brick and mortar retailers also busting out ch were going to give you the names and tell you what it means for the economy and your money. Later, traders are betting one Big Oil Stock may be close to cutting its dividend, the name, what it might mean for the energy space. Big show on a steamy friday in new york, but start with the overall markets