Transcripts For CNBC Closing Bell 20161018

Beneficial in the short term. After the bell an exclusive interview with senator tim kaine, the democratic Vice President ial nominee making an economics speech in detroit this afternoon. Goldman sachs, one of the leading dow components today on the heels of its Earnings Report that came out this morning. The Financial Firm getting a big boost from trading revenue. We have more on that move coming up. And from olympian to entrepreneur, Michael Phelps will join us here to discuss his latest Business Ventures as more and more athletes turn themselves into enterprises. Swimming with the sharks in the world of business at some point. The nasdaq really the big leader in todays market rally. Seema mody has more for us. Netflix being the driving force contributing about eight points to the nasdaq 100 gains. The headline numbers were positive. Subscriber growth here in the u. S. And internationally came in ahead of consensus. Speaking to analysts netflixs programming pivot seems to be a key part of the earnings story. The stocks participating in the nasdaq rally. Semi conducters outperforming posting best day this month ahead of earnings due after the bell the stock is higher today and also up by 9 year to date. Another sector feeling the nasdaq is bio tech which has been under immense pressure because of political rhetoric around drug pricing. Despite Hillary Clinton leading in the polls we are looking at shares of bio tech higher across the board. Adam parker is advising clients to buy bio tech reasoning is valueuation looks compelling. He mentioned m a being a big part of the bio tech story Going Forward. Going back to netflix the Company Announced content spending will rise to 6 billion next year which is a billion dollar increase. For more on the move and whether the company is spending too much money on content that has long been the question asked about netflix, Larry Haverty is cautious on the stock. We have Cfra Research who is bullish on this stock. Does this report change your mind at all . Get your attention . What do you think . Certainly the price increase yesterday got my attention. Just to put it in perspective the stock went up 8 billion and the bottom line incremented by 20 million. The delta on earnings was capitalized at 400 times. I have been around quite a bit through the years on the street. I never seen a 400 multiple put on earnings growth. What netflix is doing is getting into the content business. They are producing some content them selves and buying it for their exclusive use. Other companies do this and they basically hired somebody from another company to help them with it. That company being nbc. Those businesses are capitalized in the market at 10 to 15 times. So you are paying an awful lot of money for netflix. There is no Free Cash Flow. They are increasing estimates of the degenerating level of Free Cash Flow at 1. 5 billion. It is a very mediocre profitability on return on assets. It is a high valuation. We just showed that netflix outspends nbc in content. That 5 billion number returns 6 billion next year. Are they spending too much on content . We do acknowledge some trepidation in terms of the growth in content spending for netflix. Thats not just netflix but across the industry even on television. I think it has become a lot more difficult to break through the clutter so on the other side you have the demand that seems insatiable. We do think that over the long term certainly near to medium te term we kept buy recommendation. We think content should be viewed as a quasifixed cost. As they expand they can leverage that and it can be certainly sustainable in the near term and the price increase should provide some cushion in terms of the nearterm Free Cash Flow deficit. Let me just you sort of brushed aside larrys point on valuations. That is a pretty high valuation for any company not just netflix. I think netflix is defined conventional valuation metrics. We dont think the international upside is anywhere close to being fully recognized by the street. I think that is where the disconnect is coming from. When you take a broader look at the upside they just kind of launched across the globe, they reaffirmed their outlook. We think second half next year will be an inflection point. A lot of analysts are missing that in terms of how soon the spending turns around. By any number of measures we think the payoff on that content spending is justifiable. And also viewer engagement. All of these things bode well for continued spending. Whats your point of view on their spending on content here . The question is are they buying the right content . That is a very tricky act. There are 400 sericereals in production. Everybody wants to get into the content production business. How do you know what is good and what is not . In the case of netflix when they buy stuff that isnt good are they putting it through the income statement. You take marco polo which was an expensive series, has that gone through the income statement . We dont know. There is an awful lot of content sitting on the left side of the blangs sheet right now. The history of media there were companies that hit the wall with content problems not having been written off. When you get into the world of parallel metrics for stocks as opposed to good Old Fashioned cash flow profitability, Balance Sheet integrity you are in treacherous water. The analysis on the international for netflix is a lot like aol in 2000. We know how that ended up. We got to go at this point. I wish i had more time to get you to respond to that but we have to move on. Thank you both for your thoughts on netflix. Lets get to our closing bell exchange. Charlie smith is with us. Steven with a big smile on his face. He would be too embarrassed to mention but he went home long netflix last night and Rick Santelli is in chicago for us. Good call on that one and clearly this rally today has a lot to do with the earnings that have been coming out here. Certainly. We have seen really consistent beats. It is early. We are just barely into earnings season. We are not going to claim victory. The revenue side year over year revenue we see numbers like 8 , 10 and 12 . The numbers are better so far. You can see that in the s p 500. They even with stood a bit of a comeback by the dollar today. Really i guess they mimicked oil because oil did rally a little bit even though it is not a perfect lay over. Earnings are a little bit better. And you guys like technology, it says here the semi conducters, cloud software, intel should be interesting this afternoon, then. Absolutely. We are looking for real strong numbers out of their server business. I think they are going to sort of continue the beat the street sort of tone we have seen so far this earnings season. You like commercial aero spa space. Why is it because of the valuation or do you feel confident about the prospect snz. We have seen really no change in trends in terms of air traffic around the world. Number of people getting on airplanes continues to grow. There has been concern about the 777 order book for boeing but they just got a couple of orders for that aircraft here in the last week or so. There were comments from honeywell but really didnt focus on aero space side but said it continues to be outside the Business Jet Market pretty strong. We are liking that area. It seems fixed income is overshadowed by Earnings Reports. What are you watching that is affecting your markets here . I think it is. And i find it fascinating that as stocks get back their legs to some extend normally Interest Rates if they are pressured to the upside when they see stocks do better that makes them go higher. Not the case. Its still a steep curve but our rates moved down. If you look at tens and 30s these are lows only since thursday a couple of sessions. The best highest close since the 22nd of september. And the big story today that i was a little late to read about but it is fascinating, Norwegian Fund when you look at the southern wealth fund hinting about going into stocks and cant make it in oil and they absolutely have to get a better return so everybody is going to the only place left. Im not saying it is a bad idea but once again we are packing a lot of people in equities at a time where i am not sure we have the under pinnings. Not every stock will have a day like netflix. You add the shift to active to passive investing which takes people into pure long positions. Are you concerned about the market being overvalued or do you find plenty of areas to invest . I think the move from active to passive is a constant. I think if we do see the ten year push through 180 level aggressively i think ricks comments could be a harbinger of pain. I think people keep bringing up the 1987 analogy. We had a huge move in the long bond. If we see the ten year spike up from here i would be concerned about stocks. Before we go, what levels are you watching right here . I will ask the question that all traders ask you. We stopped about three times today. That is your first line of resistance. It is kind of crowded. We have lines of 2153. 2139 is where you want to see support which we are only about two points away right now. Indeed. See you later. What do we have here . We have 48 minutes left in the trading session. Dow up 85 points. An earnings fuelled rally today. Weighing a little bit. You can see it is up half a percent relative for the s p and the nasdaq up 1 . Democratic Vice President ial nominee making a big speech on the economy. We will ask him about the economic and tax plan in an exclusive interview. Goldman sachs giving a big lift to the dow after reporting much better than expected earnings. We will break down what is driving those results and whether or not the Financial Sector can come back at last. And the earnings parade marches on. Intel and yahoo report after the close. We will have instant analysis later on closing bell. Is it because so many go after it the same way . Chasing after short term returns. Instead if getting caught up with the crowd, the Investment Managers at pgim take a long term view, teaming specialized active investing with riskmanagement rigor, to seek out global opportunities. We manage over a trillion dollars this way, attracting many of the worlds leading investors. Partner with pgim. The Global Investment management businesses of prudential 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 mentioned the nasdaq clear outperformer led by rally in netflix boosting other Technology Momentum stocks. The s p 500, the dow up 82. Check on other stocks making moves today. Dominos pizza higher after delivering much better than expected profit revenue. See what i did there. That was thanks to a 13 increase in samestore sales as rivals in the Restaurant Industry struggle with slowing foot traffic. Ceo Patrick Doyle will break down results with jim cramer tonight 6 00 p. M. Eastern here on cnbc. Harley davidson shares revving up after beating estimates. Maintain its outlook for the Fourth Quarter driven by enthusiasm for recently released 2017 model lineup. Goldman sachs one of the best performers after reporting much better than expected earnings. Shares up 2 . So big beat on the eps line. Double digit returns of 11 very impressive. The beat largely down to trading. Fixed income currencies trading was strong up almost 50 from q 3 last year. Harvey shorts on the performance. Year over year we were up 49 . I think in some respects that speaks to a weaker Third Quarter environment last year but i have to agree with you. I wouldnt say it was particularly strong quarter. Year over year i talk about some of the drivers. I would say maybe the best way to describe it, it wasnt so much about tail wind as it was about not having so many head winds. Later he said not too overemphasize Third Quarter trading performance but momentum was good. On expenses they did post a 3 quarter on quarter. It all seemed sequential increase in costs. Back log is encouraging particularly the u. S. And advisory was better towards the end of the quarter. We got comments on new online lending platform where scharts said the approach would be slow focussed on prime customers and aimed at delivering flexibility and simplicity. Shares up holding on to gains which some banks havent done after the other banks grew their total dollar amount of earnings year over year and by a substantial amount and the revenue figure was much higher. Id say probably most impressive thing is the returns. Double digit again. They made 15 about six quarters ago. That was in a better overall environment. The environment this quarter hasnt been stellar. We havent seen the rate hike yet. To get back to double digit returns there are about 6 or 7 above the average. Wells is higher already but a different company. And the trading revenue is impressive when you consider what a lack of volatility it was. I think that very much again focussed more into the fixed income area, not even the currencies and commodities. Rates and fixed income. They grew that up 50 . Their equities performance was positive only 2 growth. The others seem to decline. We tend to lump all these banks together as the financials or the big banks but they really are very different in the way they do their business. Of course. They are an investment bank. That came through in these results. The thing i would say for the sector as a whole clearly this wasnt an outstanding environment to do banking. U. S. Banks have all proven they can earn in this environment. Its a completely different picture. Interesting comments on that. Particularly Goldman Sachs in terms of market share gains. This is an environment where they can grab a bit of share. Cfo said it is potentially something to drive share. New york is a Financial Center relative to the rest of the world. It will be a tough act for Morgan Stanley to follow. We will see the last of the majors to report. Well see what they have to say. From a low evaluation base getting them to equal but value. Pleasure as always. Tomorrow dont miss david favors exclusive with Lloyd Blankfein tomorrow on cnbc. 40 minutes to go until the close here. Pretty strong gains. The dow up 80. S p up 14. Nasdaq up 51. Olympic swimmer Michael Phelps talks about how he is making the transition from athlete to entrepreneur. Dont miss exclusive interview with democratic Vice President ial nominee tim kaine on why he says his running mate Hillary Clinton is the best choice to jump start the economy. Before taking his team to state for the first time. Gilman go get it, marcus. Go get it. Coach gilman used his cash rewards credit card from bank of america to earn 1 cash back everywhere, every time. At places like the batting cages. [ crowd cheers ] 2 back at Grocery Stores and now at wholesale clubs. And 3 back on gas. Which helped him give his players something extra. The cash rewards credit card from bank of america. More cash back for the things you buy most. The cash rewards credit card from bank of america. This car is traveling over 200 miles per hour. To win, every millisecond matters. Both on the track and thousands of miles away. With the help of at t, Red Bull Racing can share critical information about every inch of the car from virtually anywhere. Brakes are getting warm. Confirmed, daniel you need to cool your brakes. Understood, brake bias back 2 clicks. Giving them the agility to have speed precision. Because no one knows like at t. Rally day for wall street. We have the dow up 80 points off the highs for the session. The s p is up 14. The nasdaq just coming off its highs, as well. 1 gain a little while ago. Still up 50 points. A volatile trading day for tesla. Shares dipping and then recovering after the company quietly changed the delivery estimate for its new model 3 orders to mid 182018 or later. Tesla predicted deliveries would start late next year. There you go. Shares up nearly 2 right now. He is the most decorated olympic athlete of all time. After this years Olympic Games his medal count is 28. And now Michael Phelps is turning his attention to other ventures out of the water such as his foundation and swim wear brand. We welcome mr. Michael phelps. Welcome sbrmpt dh how are you guys . Good. I was waiting to see what cap you wore. Ashton kutcher was on with an l. A. Dodgers cap. I heard you were raring a Boston Red Sox cap. No. 60s orioles hat. I was very surprised when i read. Apparently i was misinformed. What did you tell the attendees there at the under 30 Conference Today . What was your message . We kind of talked about how i was able to get to where i am today. My whole really path to start with a goal and a dream and hard work and dedication and believing that i could do something that basically everybody else said was impossible. I used all of that as motivation and was able to just put time into it and be i guess end up having a pretty good career. I dont know if i will ever be able to wrap my head around that. At the same time we are seeing tiger woods launch his own company to bring a lot of his different brands and endeavors under one umbrella and continue to parlay his past success more into the Business World. Are you looking to do the same kind of thing with swimming gear or is swimming just one area of many where you are looking to make an impact . I mean, for me, swimming has been a huge part of my life. When i started having a goal it changed so much over the last 16 years. If you think about where it could go so many opportunities and being able to start and have things from learn to swim all the way up to the highest level of something you can possibly be at for me it is fun. It is kind of cool being able to construct your own suit, have them have input on goggles and make the best product in the world. You want to make swimming more accessible to kids who wouldnt have access to it otherwise much like tiger has done with his foundations. How do you do that . Well, drowning for children under the age of 14 is the second highest cause of death. That has to change. Our goal being able to have more people have access to a pool, to instructors, just to learn how to swim. That is something that is so big. For me that is basically how my career got started. My mom wanted me to learn how to swim. This has been a passion of mine for so long. Being retired again i have a lot more time to be able to travel a lot to these different sites and hopefully be able to have an impact with children and learn to swim. You have a dizzying array of other sponsors and deals. Plenty of Different Things have come your way. I would like to know are there one or two that you kind of just laughed at and said i just cant do that . That is too ludicrous . If you look at the partners that i have it is everything that fits into my life. They are things that i have used and things i used my entire life. I think every company that im with fits into my personal life and just really how i go about my day. But i havent run into anything too crazy. We love asking our celebrity guests about money mistakes. Biggest money mistake . What is the biggest money mistake Michael Phelps has made to this point . I cant think of one off the top of my head. I know there are a few i probably could have done without that i have learned from and i have been able to move on and building a family. That is pretty much what it is about. He admitted to a few. You almost tied paris hilton when she said she never made a mistake. I wont admit to the mistake yz have made. I want to ask you about brands that fit into your day to day. What is your day to day life . I have a couple of specific questions as a regular person. How much are you swimming these days . Are you still eating 10,000 calories a day . What is retired Michael Phelps like . Im not eating 10,000 calories a day. For me it is kind of just a peaceful place. Its a place where i can just kind of think about whatever i have going on around the world and be myself y. Am working out and try to stay in some kind of shape. She and you are the same age. She is trying to figure out how much she should be eating. You are going to tokyo. Not to swim. Maybe to surf. You are absolutely done this time . Yes y am. The reason why is for me to accomplish what i had this past summer, thats the best way i can go out. For me that is what i was looking for, my comeback and now being able to start a family and nicole and i are getting married soon. We have a beautiful baby boy. Life is great. Congratulations on that. One final question. Are you going to branch into equity investments, Venture Capital kind of things . Will we see you ringing the bell at the New York Stock Exchange in the future . You never know what can happen. I would love to get involved in small things on the side and have fun with stuff. I guess time will tell. I would love to ring the bell. Fun to have you on. Continued success. Appreciate you taking the time today. Congratulations. Thank you, guys. Michael phelps. Time for a cnbc news update with courtney reagan. Not every day you get to follow Michael Phelps. Samsung is reportedly opening Exchange Booths at airports where travelers can trade in their galaxy note 7. The smart phone maker set up Exchange Booth over the weekend. Last week the department of transportation banned note 7s from all u. S. Flights. Gap says it will close all eight Banana Republic stores in the uk to refocus efforts on north america. The Company Previously said it was shuttering 75 overseas stores. There are more drivers than ever on u. S. Roadways and 20 of them are over the age of 65. New government report says senior drivers are the Fastest Growing demographic and should grow by 77 by the year 2045. Here is a question. Where is bob dylan . The nobel panel has been looking to give him over 927,000 but cant find him. He was awarded the prize for literature by the academy last week. I love, love, love that story. They cant find bob dylan. All they have to to is buy a ticket to a concert. You found him. Exactly. Thanks. Will he show up at the awards banquet in december . Another question. 27 minutes left in the trading session. The dow up 78 points. The nasdaq has been the standout today almost 1 gain. Yesterday we discussed new analysis claiming Donald Trumps tax plan would be better for the economy in the short term. Hillary clintons would be better in the long term. One of trumps top economic advisers joins us. We get reaction in an exclusive interview with democratic Vice President ial nominee tim kaine coming up on closing bell. Welcome back. We have about 25 minutes to go in the session. I am here with steve grasso director of Institutional Sales for a look at a pretty strong market into the close. If you look at crude, if you over lay crude and the s p today i dont know whether it was causation or correlation but crude appeared to me to lead the market down early, also led it right back up once it bounced. We are still crude dependent. S p cash 2135. That is that may 20th, 2015 high. That is soft support. We are three weeks away from the election. Tomorrow is the last debate. A survey said bio tech executives would support Hillary Clinton. Are we moving away from the politics . If they said they werent and she looks like she is going to be the winner if you took it right now. 20 of people supported trump. The reason banks have to give money to democrats and republicans. If it is a lock is it having an effect . We have seen bio tech recently take a beating. We have seen them worry about head winds with a hillary presidency. The big question is do they just win the senate or do they take over the house . If there is hillary, senate and house and one party owning all branches of government i think bio tech would be worried about pricing. Heading to the close with 22 minutes left in the trading session with dow up 83 points. We talked about this Wharton School Research Paper that found Donald Trumps tax plan would boost job creation and Economic Growth and would hurt the economy in the long term. One of mr. Trumps top economic advisers strongly disagrees with that assessment. He will join us next to lay out his version. Then democratic Vice President ial nominee tim kaine will join us in an exclusive to make the case for Hillary Clintons plan on the economy. Coming up, stay tuned. Jake reese, day to feel alive jake reese, day to feel alive jake reese, day to feel alive were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. We are just 21 days from the president ial election which gop nominee donald trump says has been rigged against him. How vulnerable are Voting Machines which it turns out are badly outdated, to hacking . The good news is that experts say the possibility of digital tampering at the polls is very remote since most arent connected to the internet. The bad news, Research Shows the Technology Behind most machines is grossly outdated. 43 states have Voting Machines that are at least a decade old. A nonpartisan group. According to the department of Homeland Security 33 states have accepted help from the agency to provide a cyber hygiene scan and most machines are running on Outdated Software like windows 2000. Cofounder of the institute which works with Election Officials to update infrastructure. The largest problem here is the pcbased equipment is built upon technology that is not only ant quated but is obsolete. Innovation has evolved to Software Patches from eastern europe. Provide the vast majority of Voting Machines, dominion systems and there is Little Market incentive for the companies to a hold up with evidence a recent study at Loyola Law School examined 1 billion votes and found only 31 instances of voter fraud. Thank you. The Wharton School of business was out yesterday with a new report which says Donald Trumps tax plan would be better for the economy in the short term but clintons would be better in the long term. Yesterday we had the man on the show behind the report. Our model takes additional deficits created by the plan into account in particular if the economy is open economy similar to the United States today and we have the capital flows that we have seen historically then as the government produces new debt that debt competes with private capital for household saving as well as International Capital flows. That crucial link is actually being missed by a lot of models that are being used to analyze tax plans. Joining us now to take issue with that analysis, senior trump policy adviser and you disagree. What do you take issue with specifically . Lets view the big pick dhr. We have two candidates. Donald trump wants to eliminate our trade deficit by increasing exports. Everything about that pushes towards growth. Clinton wants to do the opposite. She wants to raise taxes, raise regulati regulations. What is the problem here . There are two things going on. One is that all of these think tanks that are looking at including Wharton School only look at the tax plan. So that skews against republicans because of course when you get tax cuts you get tax reductions. For example, the Tax Foundation showed that trump plan reduces tax revenues by 2. 6 trillion. But our Analysis Shows when you include the positive offsets from Energy Regulation and trade its revenue neutral and you get twice as much growth as clinton, millions more jobs. What is going on is this slight of hand. It seems the reason everybody is focussing on the tax issue is it is one area where both campaigns put out the numbers and clear policy and gives people a sense of big and important enough input we can try to find out how that would effect things down the road. It is so hard to do the things that you mentioned especially if there is a divide in congress or something. When we did the analysis of Energy Regulatory and trade it was not difficult to do. Let me show you the flaw here. Symmeters shows growth best for trump in the first eight years. How does he get it to flip . What he does is he assumes massive budget deficits because of the tax cuts. He is not alone on that, by the way. What he doesnt consider that if we got the growth from energy, regulatory and trade we wouldnt have deficits. By the way, we have had eight years, jacked up the debt by 10 trillion and Rick Santelli is still waiting for it to go up. The question she brings up is something i brought up yesterday that whole question are you going to get any tax plan through Congress Much easier said than done. I dont care whether you are Hillary Clinton or donald trump. The whole thrust of the trump plan is trade, energy, regulation, get this thing going again. We went 3. 5 now. Now we are at 1. 9. Are both campaigns ignoring the political realities of washington . Trump is the art of the deal. If anybody can sit in a bipartisan basis and push things through it will be donald trump. It will not be Hillary Clinton. Give this guy a chance because at least if you want 25,000 on the dow give this guy a chance to grow and prosper and these studies are missing the Bigger Picture here. Good to see you. Thanks for stopping by. A senior Trump Economic Policy adviser. Donald trump and Hillary Clinton will go head to head on the economy and much more during the third president ial debate tomorrow night. You can catch the whole thing here on cnbc beginning at 9 00 p. M. Eastern. 12 minutes to go. Dow hanging on to a gain of 75. Nasdaq up 46. Nasdaq leading todays rally. Is technology the place to be right now . We will talk with a top asset manager who thinks so when we come back. Hey gary, what are you doing . Oh hey john, 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. With new cabinets this wfrom this shop,house, with handles designed here, made here, shipped from here, on this plane flown by this pilot, who owns stock in this company, that builds big things and provides benefits to this woman, with new cabinets. They all have insurance crafted personally for them. Not just coverage, craftsmanship. Not just insured. Chubb insured. We have tech earnings coming up after the bell. Yahoo reporting. John lipton will be looking at intel. Tell us what wall street is looking at from yahoo. Of course, yahoo has cancelled the regular Earnings Conference Call so it will not be fielding tough questions relating to potential fallout from the massive security breach. The latest report that verizon believed to be losing patience with yahoo on the probe. Yahoo is expected to continue the story of the last few years. Switch to other platforms like facebook and google. We look forward to that. Josh, tell us about what you are looking for from intel. Intel stock is up about 20 in the past six months. Can ceo keep the momentum going . Looking for eps of. 73. Now predicting some 15. 6 billion. Gain of 8 . That is mostly because hardware makers are restocking their inventories of pcs. The question are hardware makers doing that because there has been meaningful sustained pickup in demand or because inventories got too lean. Says the real focus for investors intels data center business. Analysts expect revenue there. Thank you. Well see you coming up at the top of the hour with those reports. Coming up also intel executive Vice President stacy smith will break down his companys results minutes after they are released. Dont miss that interview coming up. Joining me on the floor of the New York Stock Exchange jeremy hill. You like Big Technology right now. Would that include intel here . We dont have an opinion on intel per se but if you are looking for a sector we think has a lot of legs on relative value basis and also as generally a growth investor you have to like Bigger Technology names. Driverless cars, artificial intelligence. One company we have liked has been qualcomm. We talked in the past about Technology Companies that also pay a dividend which has been a draw for a lot of people. Does that factor into your thinking, as well . It certainly does. If you are looking for a quality earnings, shareholder yield and also being in the right sector at the right time that is something you want to look at, as well. Has the market figured that out . What about valuations . It could be argued a lot are richly valued. Valuations are here and there and pingpong back and forth. Look at the Bio Technology valueuations. You can make the case that the etf that is Bio Technology rich is basically down 20 this year. You picked a very volatile sector. One day they are richly valued and the next day clobbered for missing a panel. Historical volatility in the market have not been converging the ways people have anticipated. That might change when we get into the new closer to the election cycle. Technology overall, what happens when the fed starts raising rates . Does that eat into their earnings . First big assumption but of course right now break even is predicting 63 chance of rate rise in december. I dont think that affects Technology Companies like other companies. Thank you. Jeremy hill joining us on the floor. We will come back with the dow up 76 points. We have closing count down coming your way. Stay tuned after the earnings. We have tim kaine who will explain why his running mate Hillary Clintons Economic Vision is better for the nation than Donald Trumps. That is next hour here on closing bell. You are watching cnbc, first in Business World wide. This companys servers. Accessible by thousands of suppliers and employees globally. But with Cyber Threats on the rise, marys data could be under attack. With the help of at t, and security that senses and mitigates Cyber Threats, their Critical Data is safer than ever. Giving them the agility to be open secure. Because no one knows like at t. Gilman go get it, marcus. Go get it. Coach gilman used his cash rewards credit card from bank of america to earn 1 cash back everywhere, every time. At places like the batting cages. [ crowd cheers ] 2 back at Grocery Stores and now at wholesale clubs. And 3 back on gas. Which helped him give his players something extra. The cash rewards credit card from bank of america. More cash back for the things you buy most. The cash rewards credit card from bank of america. [ala m beeping] the highly advanced audi a4. This is my retirement. Retiring retired tires. And i never get tired of it. Are you entirely prepared to retire . Plan your never tiring retiring retired tires retirement with e trade. Im in vests and as a vested investor in vests i invest with e trade, where investors can investigate and invest in vests. Or not in vests. Sign up at etrade. Com and get up to six hundred dollars. Very quickly. Rally day. Crude oil, steve grasso makes the point that crude oil leading the market today. But when you look at some of the components in the dow you had Goldman Sachs which had blowout earnings and a big rally. You had ibm which showed more revenue decline and it went down today. This was a broad rally. We stayed up. We had stories about the Norwegian Oil fund. I think this is a pretty four to one advancing. We finish with about an 80point gain. Intel and yahoo reporting earnings. Stay tuned for exclusive interview with tim kaine all coming up on the second hour of closing bell with kelly evans and company. Thank you, bill. Welcome to closing bell. Im kelly evans. Rally on wall street today all three averages rising and the dow up 75 points or so on the bell today. The s p 500 adding about 13 points to 2,139. Dow up 75 to 18,161. We have more earnings on deck. Two tech earnings. Josh lipton standing by to cover intels results. We will get numbers from yahoo as soon as they cross. Democratic Vice President ial candidate tim kaine fresh off the podium in detroit will join us to discuss his economic plan coming up. Joining me on the panel we have michael santoli. Welcome everybody. Earnings are already off to a furious start here. Just thoughts on the market . I think the earnings we got since yesterdays close was good enough on Goldman Sachs, United Health care and netflix. We did hold on but i think we got enough to get it to the middle of the range. The one thing that concerns me pretty deeply. All throughout october we had lousy volume. The participation isnt there. I thought they were pretty well. They showed their trading is doing quite well. Netflix just blowing everything out. It was a good earnings day overall. What about those netflix numbers in the way that they responded . People continue to try to write them off. They are losing in competition. It is difficult to replicate what netflix has done and except for a couple of missteps literally a couple hastings has done everything out. Im not going to say this surprised me. I do think it surprised a lot of people. I think what they are proving is netflix isnt done quite yet. Alphabet was close to closing. Those shares responding to what here . Why does the fact that netflix did better lift that whole group . It shouldnt. Netflix is a fairly singular business. I think it was much more about maybe the large cap tech space isnt over done at these levels. Alphabet has something to choose it as the stable name in the group or it is just the top of the nasdaq. I think that was all. Semi conducters did well today. Lets go to results from intel which are out. Josh lipton has the numbers. Intel reporting 69 cents versus expectations of 73 cents on the top line. 15. 8 billion versus expectation of 15. 6 billion. Looking through the release here intel saying nongap Gross Margins 64. 8 . Turn to Business Units client computing groups so revenue of 8. 9 billion. Chips are increasingly critical. Revenue of 4. 5 billion about in line with at least expectations and estimates i was seeing. Spinning ahead intel guide for revenue of 15. 7 billion plus or minus 500 million. I think you will hear a lot of questions about that pc market. The outlook for the year ahead as well as data center group. Executives told us they expect double digit growth. They had questions about what they refer to as lumpiness. Calls kick off at 5 00 p. M. Eastern and we will be on it. Thank you. By the way, intel executive Vice President will be joining us on first on cnbc interview to break down results in just a few minutes. The shares are down 4 or 5 on the news and guidance. Anything stick out to you here . Intel has had a huge move. 30 stock traded up to 38. That is not insignificant move for a company of this size. All numbers the one that stuck out to me was this. Guidance for Gross Margins Going Forward street was looking for 63 give or take guiding to 61 . What youll start to hear now is have we reached peak margins for intel and does that mean the stock should fill. I dont think it is expensive but technically back to 2014 we seemingly just failed levels we failed at a couple of years ago. There is an opportunity to buy the stock. My sense is it is closer to 33. Trading around 36. 50 says looks like the first miss. Clearly a stutter step. It has been riding high and is kind of the slower moving cheaper name which is not necessarily the one that will deliver on quarterly basis. I think it makes sense for it to step back. They did get an upgrade this morning. And technology is finally become the leading sector after a long time. I think we are going to have to see where semis land across the board on a go forward basis. This is a trip up for intel. I would like to see where the stock starts to trade tomorrow. The stock has not quite a 3 yield. I think that triggers a lot of institutional buyers. Shares fluc chating but down about 4 . I wonder if it is because it is rare to miss on the bottom line. So many people watch the company. And i just think the way people were leaning into it. People did get a little bit of extra excitement about what this group can do this reporting season. I dont think you can extrapolate the reflex move here before the call as to how it will be tomorrow. Client computer revenue 8. 9 billion relative to the estimate. A lot of people are watching this pc cycle especially looking at memory names and what some of those did in the session today. You want a sign that maybe the declines we have seen are at least flattening out. And people are participating and there is investment in the space. To the point that we have been making over and over are we at peak earnings across the board. Can we go further than this . I think this quarter once we see earnings from some big names we will get a clue into that. We look at intel relative to what we heard from netflix yesterday do you think people will still like the idea about the momentum in the sector, do you think they will be able to look past this . I think they will be able to look past it. I think to mikes point not like a Straight Line in terms of earnings for these guys and gals. There have been hickups along the way and the stock reacts. Within a couple of weeks it is back towards levels it was trading at and some. I think my concern about owning the stock right now is i think you start to hear rhetoric about the Gross Margins, might scare some people and might see the stock trade down another 7 or 8 from current levels which wont be catastrophic. I think it will give you an opportunity to buy the stock closer to 12 1 2 earnings. We can see the impact that the earnings are having clearly on the market today. Ibm where some of the big decliners on the dow which otherwise finished positive. Goldman today you mentioned even United Health, these have been the story here. You are looking at the performance. We will see what happens tomorrow. Seems like it will be that kind of offset. That has been the story where they have been good enough to keep the markets at the levels they got to. Really tough to draw across the board theme in terms of companies. Only about 10 of the s p has reported. Yahoo which missed on four of the last six reports has its latest results out. Finally a little bit of good news for yahoo. Of course, the ailing internet giant canceling Conference Call. Earnings per share beat the expectation coming in at 20 cents per share. Revenue in line with expectations coming in at 1. 31 billion. We also want to delve deeper. The revenue metric is one that was said would lead the company in growth. That increased to 524 million from 522 million a year ago. You can see the stock is moving up slightly in after hours trade. It is unlikely to move the needle much. While it is a little bit of good news on the earnings beat there is no Conference Call and we will not be getting answers to the many, many questions surrounding the verizon acquisition and what they are going to do about the massive data breach. Thank you. In the release Marissa Mayer says we are busy preparing for integration with verizon and that is pretty much it. That is the story. The only thing that would move the stock would be news on the front of whether there is a renegotiated price or verizon is looking for a way out of the deal which there have been no firm indications of. Basically the stock trades just as the sum of its parts. Anticipated proceeds from the verizon deal minus taxes gives you the yahoo market cap. What do you think . This has been a dog with flees for many years. We have seen extraordinary amounts of money go to extraordinary leaders that have just not managed at all. So i think it would be very frightening if the deal fell apart both for yahoo and anybody else who wants to be picked up. I dont think there is any indication of that. It is just lets see what happens and when they will tell us about what the combination looks like. You do have twitter talking about what happened with yahoo here. I always have twitter on the back of my mind. I think it is too valuable for people to throw away and say it is over and not ever going to be anything. I happen to think it is. I know the move is dramatic and scary but i still think if you have the tumerity to own the stock i do think they will figure it out. I actually think that maybe the best thing that happened to twitter is sales force or apple or disney didnt buy them because when they do figure out their woes this will be a powerful company. Im still not convinced that everything that ails them is that difficult to fix. Well see what happens Going Forward. I actually agree with you. I own twitter also. I took that ride up and back down recently. You do have to have a strong stomach to own Something Like this. It is a flyer. Every Single Company has a twitter that is essentially their Customer Relations department. There is no way that you can be a Company Small or large these days without twitter y. Do agree. You have to define what a flyer is. It is still a 12 million market cap. A lot of Companies Said it might cost you 20 to buy twitter. It is a big bite for something where they dont see a direct path to a financial payoff. That is the complicated piece of it. The way that people use it on the business side is so important. It makes me realize why linked in or other repositories are so valuable. Can you be a brand if you dont have active social Media Presence . You cant because people wont take you seriously. The only way to be on the map is to have a facebook account, twitter account, be on linked in and pinterest and a number of other resources. You just cant play the game. The millennials get pretty valuable. Im a millennial. What do you mean those millennials . I am as millennial as they get. Im going to a beyonce concert later this evening. I struggle to keep up with you. I want a quick comment on overall macro because the inflation index cools off today. Bond yields are coming back down. I guess we are watching oil here. Is this just a pause . Again, i think the best word is muddled. Data over the last 8 to 12 months has been exactly that. When you think you are turning the corner you get numbers that tell the other side of the story. The bottom line is this. The fed, every benchmark they put forward in my opinion has been met. The longer they wait the more i say what do they see that the rest of us dont see and what are they scared of . The s p continues to hold critical support levels. It continues to bounce off. Until we get a three or four closing below sort of the 2130 level i think the bull market is in tact. Thank you for joining us. Later. Busy afternoon here. Be sure to stick around to catch guy coming up. Carter worth is looking at three stocks that have been under performing and will explain why he thinks it is about to get worse for the names. We will have much more reaction to yahoo and intel earnings coming up. Stacy smith joins us to discuss the companys results. First democratic Vice President ial candidate tim kaine joins us in an exclusive interview to discuss the economy, taxes and a speech he just finished on his plan to eliminate poverty in america. You are watching cnbc, first in Business World wide. When you exclude one time charges the number is closer to 80 cents. The forecast was 73 cents. That does not seem to be helping intel stock here in the after hours. It remains under pressure. Back to you. Shares down about 3. 5 . Investors have been abandoning stock picking in favor of passive investing strategies. The wall street journal called it the dying business of picking stocks. Larry fink appeared on squawk box and said he is sticking by an active strategy. We are a believer in active. We had 10 billion of active. In equities we did have outflows. Were continuing to invest in our active portfolios. We are using maybe different methodologies and big data and factors. We are looking at different techniques to try to earn the return after fees that clients are demanding. What is the overall implication from the shift . The immediate one is tremendous pressure on the buy side and sell side. There is a huge pool of fees. In terms of how the market behaves i dont know that we are at a critical threshold that says there is too much money and somehow is distorting the way the market acts. I think that is something on a lot of peoples radar screen. I think it is displacing a lot of people who didnt have an edge or definable process in terms of how they were trying. What is happening with the big Pension Funds is they are seeing returns by active managers versus passive strategies that are hitting benchmarks and active gals and guys are not hitting benchmarks and saying we probably need to move much more into passive. I think you are seeing that giant shift at these massive organizations like Pension Funds. No matter what else is happening their doing will have implications. Tim kaine joins us for an exclusive interview on how he says Hillary Clintons plan will help jump start the economy. Plus stacy smith breaks down the chip makers results on a first on cnbc interview coming right up. Whats Critical Thinking like . A basketball costs 14. Whats team spirit worth . cheers whats it worth to talk to your mom . Whats the value of a walk in the woods . The value of capital is to create, not just wealth, but things that matter. Morgan stanley will your business be ready when growth presents itself . American express open cards can help you take on a new job, or fill a big order or expand your office and take on whatever comes next. Find out how American Express cards and services can help prepare you for growth at open. Com. Democratic Vice President ial nominee senator tim kaine speaking on poverty in america. Fighting poverty is really a growth strategy. Its a competitiveness strategy but it is also a moral responsibility. It is going to be a defining mission of a Clinton Kaine administration. Senator kaine joins us now. Welcome to closing bell. Good to be with you. I wanted to ask you about news this morning, senator. An fbi official conceding that he told the state department he would look into changing classification of clinton email if official would lend authority to request to increase personnel in iraq. Do these quid pro quo findings alarm you . Theyre allegations. The fbi and state Department Said there wasnt a quid. It was a normal back and forth that takes place between agencies over classifications of documents. I serve on two committees where we deal with a lot of classified material. Im very familiar with inner agency disputes over what documents should be classified and when. It is often the case that documents are classified for a period of time and then classification changes. That is what this is. N i counted 18 policy proposas ranging from universal prek to creating Public Health care option. What is the top of your wish list if you were to be elected and then have a split government versus a Democratic Congress . Very good question. The economic plan that hillary put on the table is four big pillars. Its investments in infrastructure and manufacturing and research and investments in workers and skills. It is fairness policies like minimum wage, equal pay for women, paid family leave and then it is focus on Small Business success. So we talked about those pillars. Specifically those that are really focussed on poverty, bringing people out of poverty and the one that i think as you point out if the congress were to be divided the one that to me seems right at the core of what we ought to be able to do is Major Investments in infrastructure and then work force skills. Because these are proposals that are embraced by chamber of commerce and organized labor and so we are going to need to look as we put together the economic plan in the first 100 days what are the things that we think we can get consensus inside congress and outside congress to move forward on. Those are core pillars where i think bipartisan success is most likely. If that changes and the congress is democratic certainly people on wall street started to price that in a little bit does that mean Something Like a public option would vault to the top . The public option is really important because you have to hold Health Care Costs down for the public treasury for individuals and businesses, too. And there are proposals that have been floated in the past moving the medicare purchase age down to let people buy in that could hold costs down. If you hold costs down then people have more money to spend for other things. This is important but i still think that those basic job investments around infrastructure and skills of the work force im sitting in a wonderful Work Force Training Program Location campus in detroit those are going to be the core of it. We ought to be able to find a bipartisan accordance in either house. One related issue is what you said this afternoon about looking to reduce out of pocket and Prescription Drug costs. Question is how. What are your specifics on how you would reduce out of pocket costs and lower cost of Prescription Drugs . One proposal that we should do and in fact we know that it works is in Medicare Part d federal government doesnt negotiate over Prescription Drug pricing. When that bill was passed it was set up as sort of a fatal flaw which is the federal government would not use purchasing power to negotiate to bring Prescription Drug costs down. That ends up affecting the public treasury and the out of pocket expenses of everyone who is Medicare Part d participant. The reason we know we can do better is v. A. Can negotiate for prices and the same is the case in other proposals of Prescription Drugs purchased for active duty military. If we look at price discounts and do the same thing in Medicare Part d we would save seniors and federal government money. That could be better used elsewhere. These issues have been brought to prominence in part by Elizabeth Warren and bernie sanders. How much power would these colleagues of yours have in a Clinton Kaine administration . Should we expect Elizabeth Warren to be in the cabinet . I have no idea because that would suggest we are presumptuous. In terms of the ideas senator sanders, senator warren have important ideas that they put on the table. So i talked today about making sure that we dont allow roll back of doddfrank. We have to keep regulation on abusive practices and on wall street so that wall street doesnt tank main street again. These are their ideas but our ideas, too. We put doddfrank in place for a reason and want to strengthen it. One source of confusion on wall street is what the Administration Stance would be come it comes to wall street. In wiki leaks emails clinton seems more willing to work with wall street banks but at the same time the whole campaign has moved from the biggest banks. Which Hillary Clinton should we expect when it comes to banks and wall street . Let me just i havent been in this for 22 years there is not a conflict with being willing to work with and being for tough regulation. You often have to work with to define the dimensions of the problem and make sure solutions have the effect that you want rather than unforeseen consequences. This is something i definitely know about her from having worked with her she is going to listen. We are very, very committed with respect to wall street that the kinds of abuses that led the American Economy to go into a free fall at the end of the last administration were not going to tolerate that again. We are going to make sure we keep protections in place so that the American Public is protected. That doesnt mean we are not going to all isen. It doesnt mean we not make the regulations work in practicality. You should be worried about fair regulations that enable the economy to grow up in a Sustainable Way and not a volatile way that is more subject to booms and busts. We did great regulation after the depression that kept our Financial System generally in place even as we were experiencing ups and downs in the economy for 70 years. Then we allowed a whole lot of transactions to go into an unregulated posture that helped take the economy down. We just cant repeat that mistake. For big banks to Small Business which is something you brought up in your remarks again saying both of you come from Small Business families. One concern from Small Business has actually been estate tax proposals. Speaking from that experience its possible that you could end up getting Small Businesses or larger farms swept in that. This is a country that is supposed to reward people for setting up enterprises and take the risk. Is it fair to take 65 . Well, look, this is a really important question. We see a growing concentration of wealth in this country that is not just unfair but hurting the economy. Most would acknowledge if the distribution of income was more even gdp would be higher. Put them on the table and say what do you think about this. For the overwhelming majority of the estates that would be subject to this tax we think it is equitable and fair and then the reinvestment of those dollars back into strategies to grow the economy dont just help a few people but help everybody even those who are paying at the top end in the tax proposals that we have on the table. Those tax proposals are one of the things that when we talk to people, to our audience and ask who are you supporting . Are you supporting trump or hillary, one thing a couple of Trump Supporters have said whether they are Money Managers or ceos is they may not favor the guy but like the kind of cabinet they think he would put together and the proposals in terms of lower taxes and rolled back regulation. What do you say to those people . I say two things. First independent analysts like moodys basically say that hillarys economic plan if implemented the economy would grow and we would add 10. 5 million jobs and the trump man we would be in recession. I cant imagine any savvy financial person who thinks that the trump plan is going to be better when the independent analysts who are pretty sharp at this say it will be worse. When it comes to taxes the trump plan does a lot of tax give aways at the top end but groups left, right and center who looked at it say it will raise taxes of millions of middle class families. That is not what we want to be doing. Our proposal is nobody who makes less than 250,000 will see a rate increase. Because of some targeted tax relief. Millions of families will see their taxes go down. Anybody looking at the plans fairly would say one is preferable. The thing about the trump plan that is particularly dangerous is it is exactly the kind of plan that we embraced. We tried it ten years ago and was one of the things that put the American Economy into recession. We cannot go back to that. Let me pivot to father william cunningham. He was a local parish priest o decided to do something about racial tension and poverty. He brought ministry to the streets founding focus hope to address poverty and injustice in struggling neighborhoods. You are a catholic, as well as am i. So there were some tough talk about catholics in the released emails from the clinton campaign. And i just wonder what your response is, what do you think father cunninghams response would be to all of that . There was a quoted email. I dont vouch for the accuracy. There was a quoted email from many years ago before the campaign was underway from a current staffer who is a catholic. I love my church. I have been a catholic since birth. I have had my difference with the church overtime and expressing differences with your own religious tradition. What i will say when she talked to me about joining the ticket we shared our faith stories. Her own methodist upbringing. This word from faith and values perspective. I dont vouch for anything in the emails. I know directly what Hillary Clinton feels about catholics and the importance of having a valuesbased orientation to public service. Senator, there was also a funny moment in a florida diner over the weekend when a woman thought you were mike pence. What im thinking through your role in a Clinton Administration especially to a public who before i ask the question lets remember that moment. How are you . Im kaine. Im the other one in case people couldnt hear that. I will give that woman credit because she also had the fastest recovery on record when i said im the other one her next line was and you know even though you are the other one i think you are going to do just fine. We should hire her because she was so fast. Issues about what you personally stand for and what you will continue to stand for in the administration. We talked a good bit about the role of the modern Vice President really is and hillary described it the same way to be there and with her when she is making every important decision to offer my two cents for my service in local, state and federal government but not only to offer but learn from the decisions that she makes. We have talked about a couple of things. On the economic agenda i have been a civil rights lawyer caring about equity issues and have been a mayor and governor focussed on Economic Development deals and growing jobs and wages. The shared prosperity agenda i worked on all sides of that one. I think there is work for me to do right out of the gate with the administration on that. I care deeply about making government work as well as it can. Serving people as efficiently and as innovatively as we can and having been a mayor and governor i think i can work a little bit on that. And then finally because i was a missionary in honduras i care deeply about the americas. I have a spanish fluency. I think there is huge upside opportunities for the United States more broadly across the americas and i would love to work on that so that we can have the strongest ties possible. Senator tim kaine, thank you for joining us. Appreciate your time especially after giving this poverty speech today. Thanks a lot. Dont forget you can watch the entire third president ial debate between Hillary Clinton and donald trump right here on cnbc tomorrow night beginning at 9 00 p. M. Eastern. Shares of intel are falling after hours despite a beat on both revenue and earnings. Well go back to earnings point. I am joined by stacy smith. Welcome to the program. Great to be back. So there is an issue with the earnings. You missed but you beat and it sounds like a gap versus nongap issue . We had a clean beat this quarter. Just in terms of guidance we set we were higher in terms of revenue. Our best ever revenue quarter up 9 year on year and 17 last quarter. We had 65 gross margin and we had 18 profit growth. It was a fantastic quarter for us. Shares are still down. There is concern about the Gross Margins. Can you explain why guidance is lower . We were three points higher than expected in the Third Quarter. We do come down a little bit as we move into the Fourth Quarter. That is primarily startup costs on next generation process. Ooipg that was as expected. Relative to where we were 90 days ago we are up significantly on top line, gross margin and profit. How would you characterize how end markets feel on the pc side and other areas that are getting a bigger part of the companys mix over time . When you look at the Third Quarter we had record revenue in the data center and internet of things business. I think you can see our strategy playing out. The big change from where we were you saw unexpected strength. First it was a combination of in market strength but we did see our customers starting to build up inventory levels a little bit from where they were. Thats interesting because a lot of people including people watching the memory names are interested in what is happening in the pc cycle. Can you explain more about why that is . We saw strengthening and for us it was most pronounced in the nonconsumer segment of the market. Looks like team are buying business pcs particularly in the mature markets. If you look at the last two years our customers have been managing inventory very lean. I think as they started to see improvement they put in more inventory in anticipation of demand levels. You talked about the lean investment. Do you see in the horizon that turning into something a little bit more productive and where might that happen in terms of your cycle . So if you just deconstruct our Third Quarter it was alltime record for us. When you look under the hood on that you see that the data center was alltime record. So from the standpoint of what we see in the end markets as playing out as our strategy really was hoping which is we see the strength in the cloud and the data center and then you have the smart sp connected devices that are connecting to the cloud. That is where you see strength in the internet of things and client segment. Thanks for joining us this afternoon. Thanks for having me. That is stacy smith. Up next breaking news on former wells fargo ceo john stumpf. Stay with us. With one notable. The highly advanced audi a4, with available traffic jam assist. On a perfect car, then smash it into a tree. Your Insurance Company raises your rates. Maybe you shouldve done more research on them. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. And if you do have an accident, our claims centers are available to assist you 24 7. Call for a free quote today. Liberty stands with you™. Liberty mutual insurance. Welcome back. It was a rally on wall street with the dow up 75. The worst performer relatively speaking up about 0. 4. S p up 13 points to 2,139 and nasdaq up 44. Oil prices jumping after unexpected inventory decline of nearly 4 Million Barrels just in. Wti crude up 1. 6 . As you heard on this program the last couple of hours it continues to push the market around. Breaking news on former wells fargo ceo. We know he retired from the board at wells fargo. John stumpf had two other public board memberships. And of course target in minneapolis where john stumpf was a former banker with nor west. Those memberships he stepped down from. I want to bring you this. S p revised wells fargo outlook to negative from a prior stable rating. It is still rated a. Still headlines coming right now. Wells fargo in the news this afternoon. He is not just stepping down from his post but stepping back entirely. I guess you would have expected that at a certain point. Maybe not immediately. Im sure it was his decision. Maybe just for their benefit he decided to not be a distraction. Perhaps it was preemptive. He probably didnt want to bring the light to the boards. Maybe he will take the time and come back. Let me circle back to the interview we just did with senator tim kaine. Did anything jump out in terms of policy, different topics in the news, the announcements made, a series in terms of what they would like to do . It is a very policy heavy ticket. They are ticking off proposals. I thought it was a little interesting that he is taking for granted that infrastructure is some kind of bipartisan no brainer if they get into office. You might have a congress or senate that is not interested in making so many deals. It is hard to say on whether you can bank on that. I think the big issue mar particularly for Small Business owners is 65 estate tax. I think that is a big concern that is glaring for people who are thinking about voting the clinton ticket. Very tiny sliver of estates. People assume they might be subject to it. I think that sets a tone just in terms of what could happen down stream. I think that is a big concern. We will have more from that interview in the next hour. Underarmer is making a move to dominate another sport. We will have details on the latest move when we come right back. Ercedesbenz grand prix race car made history when it sold for a record price of just under 30 million. And now, another mercedesbenz makes history selling at just over 30,000. And to think this one actually has a surroundsound stereo. The 2016 cla. Lease the cla250 for 299 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. A big sports deal reportedly happening for under armour. The Athletic Apparel maker will become the official supplier of onfield jerseys for Major League Baseball. Majestic has previously been the provider. The question, how big a deal is this for under armour . I dont think we walk around saying majestic made a fortune. But for under armor, they can definitely ledge leverage it somewhat better. Obviously gives them visual real estate for a lot of people, though not as many people as you like. I dont even know if the Major League Baseball viewing community of which i am part, but theyre my age and older. Well see if its the demo ua is after. The kids are wearing ua. Theyre not about nike any more. They like under armour and i think thats exactly what theyre trying to point towards. So in a sense, this is a really big deal in terms of the deal itself, no. But theyve got to do something to come out of the rut theyre in. Theyre down about 23 or Something Like that. Its true. I wonder, our resident baseball expert, mike, what roads has under armour made in the sports . Lots of athletes, very big stars they have gone to. Theyre not as expensive as the top nba stores or maybe even some of the quarterbacks in the nfl. So they have been smart about putting their brand on to some of the individuals that are standout that you actually recognize more than others. But i still dont think that necessarily the baseball market is the one that gets people buying the everyday clothes, the shoes, like basketball does. Right, exactly. And why not just stick with the continuing to pick the athletes. Why do all of the apparel . I dont know if its compelling. Look, they started out as a uniformout fitter. They started in College Football and started with teams. So they got, you know, notre dame, some of the service academies. Thats been their kind of in roads into a lot of different sports. I dont see a down side to it, certainty. But i dont until think it will vault the brand. Im listening to you talk about the kids on nike and on to under armor. Very telling and we see basketball shoes and steph curry phenomenon. Does that mean its a matter of time before under armor loses its cool . You have to keep winning the next, next and next. It takes a long time. Nike has been the leader for over ten years. You know. And has i dont know if its exactly fallen out of favor, but theyre not hitting the future numbers they have been trying to hit for the past three quarters. Thats a telltale sign somebody else is up and coming. And really with my kids, the kids on the teams i know, and some other moms ive spoken to, under armour are really the name. What were you wearing back in your baseball days . You know, you would have had mizuno in terms of the starter hats. Starter was before new era. And champion. Mizuno. I wear their Running Shoes all of the time. Because the japanese. And baseball equipment and batting gloves. There you have it. Just a few minutes away from intels Conference Call. Coming up, the key factors to listen for. Stay tuned. Closing bell is right back. Whats with the dogsized horse . Im crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. Isnt that right warren . Well, you could get support from thinkorswims inapp chat. It lets you chat and share your screen directly with a live person right from the app, so you dont need a comfort pony. Oh, so what about my motivational meerkat . Inapp chat on thinkorswim. Only at td ameritrade. Ebecause the ultimate expression of power is control. Get up to 5,000 customer cash on select 2016 models. See your lexus dealer. Were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. Welcome back. Lets send it to dominic chu for a market flashdown. Kelly, were watching shares of puma biotech company. The shares down 5 in the after hours trade on lighter volume. About 20,000 shares have traded. This after the Company Announced it was going to offer a secondary offering of its own stock, about 150 million worth. All the shares being offered in the secondary are being offered by the company, puma itself. So thats the reason where why those shares are under pressure on lighter than average trading volume. So thats the reason why, kelly, were watching puma biotech in the after hours trade. Back over to you. Thank you,dom. Intel trading lower at 5 00 p. M. We have the executive vp, stacy smith on just a little while ago. What are you listening for . I think its more about obviously, we know what intels own margin guidance was. I think more about some color on the end markets. I think thats what everyone is craving. I see the other Semiconductor Stocks trading lower. Major future guidance. That is such a huge talking point everywhere and cloud and to see how that is moving their strategy Going Forward. I think thats going to be very interesting. Thats why i found ericsons recent struggles suffered lately interesting. Because they are the ones who have trumped this internet of things like no one else. I dont know if theyre losing share to wowway or its one of those things where everyone sees this very longterm trend in motion and trying to get a piece of it. But on a threemonth by threemonth snapshot, it doesnt always pace as you would like. Which reminds me of ibm today and j j. What do you think of big blue . They always said they wanted 20 billion to be related to cloud and internet things. I think theyve got theyve gotten a little boring. They have bought i think 16 companies this past year, or at least so far yeartodate. They have spent 5 billion. So they are actually running right now, compared to last year where they only spent 1 billion. So that, i think, is whats happening in the market overall. A lot of mergers, a lot of activity, because a lot of these big guys know they cant get there from here without buying it instead of building. And ibm over the weekend was a dog. A sheepherding dog whose job it is to go chase the geese off the ibm campus. You see that . And by the way, ibm over the years has gotten rid of all of the golf courses it used to own. I mean, really, ibm was kind of an empire, and basically you were i think its a very slow, meshy transition. Its done it before. You know, i always like to point out this Company Started out, you know, essentially doing time punch card machines. Its not exactly always been what it is. It was too cheap at the beginning of this year. Its had a good run to come back. But thats because the yield was so high. People thought that it was priced to go away. I think its going to be kind of a little bit unsatisfying for a little while in terms of the evidence. Corporate transformations. John stumpf now stemmed down from two boards in addition to stepping down as ceo and chairman of wells fargo. Wells fargo began as basically fedex. Thats right. A company all about in california trying to have the fastest horse to get information from one place to the next. These companies are constantly reinventing themselves. It will be amazing to see where we are 25 years from now, thats for sure. Yeah. That reminds me of the tax projections. Well, in 2040, we think the baseline gdp my god. Were broke in 20 who. Thank you guys. Dani hughes and michael santoli. Fast money begins right now. Fast money starts right now. Live from the Nasdaq Market site overlooking new york citys times square, im melissa lee. Pete najarian, tim seymour, brian kelly and guy adami. Tonight on fast, a number of stocks that can usually survive just about anything are getting hilt and one top technician says look out below. Hell give us the names and whats got him nervous. And the mega cap tech stock that hit an all time high today and why it could be a must known for your portfolio. The Conference Call kicking off right now, josh lipton in san francisco, dialed in, ready to bring us the latest headlines. Intel added to the list of