Transcripts For CNBC Power Lunch 20150325

1. 855. We begin with facebook with the social media giant honing a Developers Conference this hour. The stock right now is currently down 1. 9 but it is nonetheless, still sitting around alltime highs. Julia borstein is live at the big event in san francisco. Julia. Thats right, mandy. Mark zuckerberg is about to take the stage. He will be addressing the 2,500 developers who are gathered here in san francisco, and there are two main topics that he is expected to make big news on. Messenger is facebooks standalone messeninging app, and he announced he will be turning it into a platform. That means that developers will be able to build other apps on top of the platform very similar to what weve seen with the line app, which is a popular messaging app in asia. That means people will be able to buy things, buy movie tickets, and do various things including read content, watch videos without actually leaving the messenger app. Big news there as well as an Ad Technology as facebook looks to be the way that multiple brands buy ads, not just on the facebook platform but to reach consumers all across the different apps. It would put it in direct competition with tweters hub. Well be monitoring and back on with more. Back to you. Thanks very much julia. The selloff on the street a big triple digit loss on the dow. Its a deeper slide. Lets check in first with bob pasani on the floor of the new york stock exchange, and bertha will talk to us from the nasdaq in just a minute. Its been a little bit of a confusing day for stock traders. Lets take a look at the s p 500. Bond yields moved up right at the open and a lot of people said thats interesting. We had some weak Economic Data and bonds werent reacting. The stock market really didnt do anything until about two hours ago when it just slowly started to droop in the middle of the day. Now, a lot of people have noted that the high beta names and stuff thats done fairly well this month were selling off pretty heavily. Semiconductor etf. Smh down heavy. Biotech, we talked about all the warning. Solar stocks have had a tremendous run this quarter in this month. Theyre also among the weakest. Stuff thats gained has been selling off the most. We did hit 1. 10. People have been talking about that. Finally, a number of people have mentioned that the buyback period buyback is in buyback are in a blackout period. A lot of companies cant buy back their stock. Guess what the gainers are today. The only dwreen you see, its in noble and danbury. These are the usual big names that are usually down. Theyre moving to the up side. Ill pick if up from there. A classic case of leaders. Now the laggard is s and vice versa. Lets head to the nasdaq where Bertha Coombs has the big movers there. It seems like the nasdaq is the biggest percentage loser out of the three indexes. After having been spun off here at the nasdaq some three years ago, they are about the only thing that has been kently up welcome back the nasdaq 100. Weve had as many as four stocks today, but those are the only two that are moving to the up side. Biotechs are the biggest source of pain, and depending on which biotech index you look at the equal waitd weight xbi etf is seeing the biggest drawdown today down the most and what you are seeing is these names that have been consistently at historic highs and have been really leading this market higher today are seeing a lot of profit taking. Recall last year we saw a huge drubbing of biotechs in the spring in april. They looked like they were left for dead and then came back by the fall. Were back to historic highs continuing through here. This could be partly a seasonal thing as well. Also among the losers today, some of the big chip names as well as bob mentioned, and tesla on that downgrade over at csla. Apple is lower, but not as much as some of these bigger names that were seeing. Back to you. What is your grade, sir . The grade on the demand 1 00 eastern straight up was d for dog. Not a good auction. Remember, this is the largest of the three auctions at 35 billion on the fiveyear note. Tomorrow 29 billion sevens. The yield at auction 1. 387. The bid side was 1. 38. Not only did it tail but every metric was below average. 2. 63, for example. 2. 63. Normally chase every dollar is worth securities available. At least thats a ten auction average. Today 2. 35 worth chased it. That was the weakest bid to cover rather than wroe since july of 2009. We all know what kind of environment it was in july of 2009. 55. 7. Ten auction average. 4. 7 on the direct. Weakest since june of 2013. Dealers take a whisker less than 40 . Tomorrow will be the last leg of the 90 billion in the form of sevenyear notes, and investors will hopefully be more excited about the longer security. Mandy, shares of lexmark are among the best performing stocks in the s p midcap 400 index today. Thats after the printer maker said it would buy cofax for 1 billion. That deal will just about double the size of lexmarks Enterprise Software unit to help the company evolve with one depend oent computer hardware like printers to more geared towards Services Like data and Image Management solutions. You can see those are up beg today. Thank you very much for that. Lets move to the market to whats going on in the economy. Lets get right to a rapid update. Senior economics reporter Steve Liesman joins owes the newsline with i believe, steve, new information from economists on gdp forecasts which seem to be coming down. Yeah mandy. The cnbc rapid update, which is an average of tracking forecasts on wall street came down pretty sharply today. Down. 2 to 1. 8 . Thats the lowest forecast weve had for the First Quarter since we started tracking it. We began the quarter at a very optimistic 2. 8 . The strong dollar which hurts exports, along with harsh Winter Weather and probably some decline in Capital Investment in the oil industry. Probably responsible for the weak durable goods. Its not just the one report. Retail sales were weak. Construction has a string of weak january and february data. Some economists remain optimistic. We have a couple of weak First Quarters, and weve had good in the Second Quarter, and right now thaelgs on faith. The numbers right now are showing up sub 2 quarter for the First Quarter this year. Muddy the waters for a data dependent federal reserve. Now to the latest on that plane crash in the alps. The leaders of france germany, and spain visiting the crash site. Phil lebeau with the latest developments. Phil. Tyler investigators wrapped up a briefing where they gave us a detail regarding where the investigation stands right now. Let me bring you up to speed. First of all, two americans were on the german wings flight that crashed into the french alps. That was revealed this morning. Search and recovery in that area is limited, and that is being kind about it. Theyre having real problems getting crews to be able to be i airlifted down into certain areas to recover not only bodies, but also evidence from the plane, and the case of the flight data recorder the second one, the flight data recorder the case has been found, but the recorder itself has not been found. For the voice recorder, here is a picture of it. It was damaged in the accident in the crash. During a briefing just a few minutes ago, this is what the one investigator said about what theyve been able to extract from that black box. We just succeeded in getting an audio file which contains usable sounds and voices. We have not yet fully understood and worked to to be able to say this is starting at this precise point and this is ending at this precise point in flight and we hear such persons saying that for which we hope to have the first rough idea in a matter of days. This is the main question that a lot of reporters were asking that gentleman in france about today. This descent of the german wings plane from 38,000 all the way down to 6,500 feet time and again, tyler and mandy, when the investigator was pressed, what did they say on the reporting . Were there voices . Can you tell us anything at all . He immediately said im not going to get into it. We need to do further analysis of that recording, and i think theyre also going to be waiting until they get the flight data recorder before they come out with a definitive explanation as to what happened during the final eight to nine minutes of that flight. Thats the latest on the investigation. Perhaps we may get some more information over the next 24 hours, but i would not be counting on it. Tyler, mandy, back to you. Thank you very much, phil. We wait. Why your mutual fund may be at risk. What some Top Fund Managers are doing in the chase for performance that is raising the red flag. Plus, a monster deal in the food business. Sarah eisen at the n wr se. In a down market kraft shares are up 35 or so. Why wall street is cheering this transformative deal to merge kraft and heinze companies struggling to keep up with consumer taste and attitudes when power lunch comes right back. If youre running a business legalzoom has your back. Over the last 10 years weve helped one million Business Owners get started. Visit legalzoom today for the legal help you need to start and run your business. Legalzoom. Legal help is here. Welcome back to power lurk. For Profit Education stocks of again, in focus. Specifically apollo which is tanking after reporting a smaller than expected loss last quarter, but it offered up disappointing sales projections for the rest of the year. Shrinking student numbers are a big part of that story after its universe phoenix operation saw a 13 drop in new enrollments. Other for Profit Education stocks, mannedy, are also taking a hit on that bit of news as well. Back to you. Wow. Drop of 24 . Incredible. Thanks dom. Okay. Breaking news. Weve got zucker berg of facebook right in front of you on the screen. This is a Developers Conference by Facebook Live in san francisco. We are monitoring the headlines, and if theres anything big that you need to know about, were going to bring julia borstein who has been monitoring this event back on the show. The stock is lower today, but it is nonetheless sitting around alltime highs. Back to the headlines Consumer Product Safety Commission confirming it is investigating flooring from lumber liquidators. The stock is down more than 53 since february the 25th when news broke about an unfavorable 60 minutes story. U. S. Steel trimming more than 2,000 jobs and temporarily halting an illinois plant. This is in response to weak demand from the Energy Sector. Stock up by 2. 5 . Its in heavy volume after it priced its Public Offering of 17. 5 million shares for 500 Million Dollars. Ty. All right. Put some ketchup on that velveeta or philadelphia cream cheese on your tater tots. A lot to the deal. Sarah. Absolutely. Its an unusual structure, but certainly wall street is excited about it. Kraft shares are surging to a record high. Theyre in the 80s. They close at 61 a share yesterday. Kraft, the Company Behind yes, tylers favorites, mac and cheese oscar myer philadelphia cream cheese will merge with heinz, which youll recall was actually taken private in 2013 by Brazilian Private Equity Firm 3g and warren buffett. Buffett and 3g are putting an extra 10 million into this deal as a special dividend for kraft shareholders just to sweeten the deal. Heinz ceo will take over as the ceo of the combined kraft heinz company. John cahill who is krafts currency will become vice chairman of the board. This company is going to be ginormous. The fifth biggest food and Beverage Company in the world. Number three in the americas. One of the strategic goals is to get krafts brands selling internationally. Its primarily in north america. Heinz, 51 of its sales are abroad. It has the infrastructure there and the global reach to help out kraft. Another big goal. Cutting costs. Management says there are 1. 5 billion of synergies here. Opportunities for overlap on cost for manufacturing, to marketing. The bigger question though what is the longterm growth picture. Consumers just are not into packaged foods like they used to be. They like organic. They like natural. They like fresh. Thats where the growth is in this industry. Its why kraft saelz have been pretty much flat and the company has been losing market share. Warren buffett, for one, told squawk box there are seven billion people in the world so, there will be tastes and buyers for kraft around the world. One of the reasons it is trying to go international. So far, guys investors are buying it. Well see about the longterm growth picture. Well hunting for union corns. The big mutual fund falling over themselves to grab a piece of those mythical startups with value wags look uber and pinterest. Why this may be putting your fund at risk. Also, as we head out, another look at the s p 500. It is a sea of red, but as you can see, if we zoom in a little bet, you can see right to the lefthand corner kraft, as i was mentioning the standout mover to the up side today. Power back in a flash. So open an account with schwab. And when a market move affects, say a Cloud Computing stock youre holding, we can help you decide what to do. With tools that help you see how market activity is affecting your positions. So when the time comes to decide whether to scale in or scale out. You can make your move wherever you are. And start working on your next big idea. In new york state, were reinventing how we do business so businesses can reinvent the world. From pharmaceuticals to 3d prototyping, biotech to clean energy. Whether your business is moving, expanding or just getting started. Only new york offers you zero taxes for 10 years with startup ny business incubators that Partner Companies with universities, and Venture Capital funding for high growth industries. See how new york can grow your business and create jobs. Visit ny. Gov business welcome fwook power lunch. We want to call your attention to whats happening with the overall stock market. As you heard, we are in a down session today, and weve had our worst levels of the session just in the past few moments. The s p down to about 21 points to Dow Jones Industrial average. Down about 225. The tech heavier nasdaq off by 1. 8 . Pacing the declines. Keep an eye on those as we head towards the middle of the afternoon session. Also watching shares of action camera maker gopro, which are holding on to you can see some gains in todays down market, although off of their highs. Theyre being helped along by bullish analyst commentary out of fbn securities which says theyre attractive at current levels. So is their opinion. They reiterated their outperform rating slapped a 75 price target. They cited the quality of the target compared to those of competitors. Lets get back to julia borstein for breaking news of the Developers Conference where Mark Zuckerberg is currently speaking. Julia. Thanks so much. Thats right. Of about 28 over the past year Mark Zuckerberg on stage right now unveiling that messenger platform that i told you about earlier today. Theyre talking about how they dont want facebook to be a platform. They want developers to build on top of all of their different products, including that messenger platform. They talked about how messenger already accounts for 10 of all voiceover ip calls. Some other really fun stuff out of the top of zuckerbergs comments including how theyre moving towards richer sharing experiences. He said i started with text and added photos. Now theyre going to get into more Virtual Reality type experiences. He showcased some spherical images that allow you to sort of open up an image and explore and look around it as if you are in Virtual Reality. Theyre going to start supporting that on facebook as well. He talked about how his activision is really about enabling everyone to share more easily and all of the developers here to enable people to use their apps and more easily integrate with facebook. Theyre going to streamline the systems and make it easier for everyone to share and really have facebook be woven into everything they do. Continue to listen in here but big moves into messenger as a platform as well as more virtual richer sharing experiences. Guys. All right, julia. Thanks very much. Lets pivot to gold prices which are closing right now, and take a look at how theyre doing. You can see they are up about 5 to 11. 97 and change. Thats. 5 . The other metals as you can see there, are kind of a mixed picture. Copper down. Paladeum and platinum off. Rick is at the cme. Hi, rick. Hi, tyler. I know i gave it the right grade when you look at intraday fives even though rates were rise aing bit, they obviously rose a little quicker right after that 1 00 eastern degraded auction. 35 billion fiveyear notes. This 158, 186 is huge. I cant stress enough when you have wild sessions like october 15 those extraneous irrationale price yields that we established to an extreme always come back and they are always important. If we look at a month to date of the euro versus the dollar it clearly shows that the euro is not given up after the dollar was a bit weak her after the fed meeting, but its still bucking up against really big resistance around the 110 handle. Mandy, tyler, back to you. Thank you very much for that. Rick at 109. 64. Well is your mutual fund money at risk . What some Top Fund Managers are doing in the chase for returns that could be a cause for concern. What it means for you. Plus stocks are selling off today. Theyre sitting around the lows of the day. Where exactly should your money be right now . Two managers weigh in with their best picks. Back in two. Now with the xfinity tv go app, you can watch live tv anytime. Its never been easier with so Many Networks all in one place. Get live tv whenever you want. The xfinity tv go app. Now with live tv on the go. Enjoy over wifi or on Verizon Wireless 4g lte. Plus enjoy special savings when you purchase any new Verizon Wireless smartphone or tablet from comcast. Visit comcast. Com wireless to learn more. Hello everyone. Im sue herrera, and heres your cnbc news update for this hour. The fighting continues in yemen. Nbc news is reporting that rebels are about to take control of the city of aidan. The white house is calling on them to stop fomenting instability. Meantime, there are conflicting reports on the whereabouts of yemens president hadi. The wall street journal is reporting he has fled aden. Nbc news says he is still in the country. The Supreme Court says a former ups driver deserves another chance to prove her discrimination claim. Peggy young says the company did not offer her lighter duty when she was pregnant. The case examines if ups fulfilled its obligation under the pregnancy discrimination act. A bus was caught on tape monday falling through a large crater that had formed in a road in northern brazil. The passengers were able to escape before it was literally swallowed up. It was immediately carried away by russiaing waters. And chinas first 3d printed sedan car was unveiled in that country. The vehicle was printed with low cost composite materials within five days and then rapidly assembled for a test drive. Thats your cnbc news update for this hour. Im not sure if i would want to take a test drive in that but its interesting to say the least. It looks like solid gold. Im sure it isnt, but im sure it isnt. Thanks a lot for that. Great headlines. Okay. With the American Express investor day is just getting started. Our Mary Thompson will be monitoring the event. What are we looking for . We want to hear from the ceo to see how he will get the payments giant back on track after a series of high profile setbacks. Back in february amex lost costco business deciding not to renew a relationship with the retailer. Thats because it didnt make economic sense for amex. Its a decision that some analysts say cost amex 10 of its earnings. The firm is also appealing an antitrust decision at loss in a case brought by the justice department. Mix in the fact its failed to reach longterm revenue targets recently, and the stock is the dows fifth worst performer over the last year. On an investor callback in february, he made up a plan to make up for the loss of business and renewals of cobranding relationships and the footprint for the b 2 b and Small Business payments and its Global Network Services Businesses as well. All efforts will cost the Company Money in the near term. Now, in addition to convincing investors that the firm can achieve its longterm goal of Earnings Growth of 12 to 15 , investors will likely press chenault to be more transparent about these contributions that the business line will make to the bottom line. It took many by surprise and investors will want a lot more detail about how new and old lines of business will be able to contribute to future growth. Again, the presentation just started. Well have updates throughout the day. Thank you very much. Mary thompson. Sflirchlts tooil, over to you. All right, folks. The selloff continues. Maybe even accelerates right nowing. The dow industrials up more than 200 points. 208 to be exact. The nasdaq down 86. The s p is off a little less than 1 . Lets check back in on the trading action and do that with bob. Important thing here is a little bit of confusing day for traders, so take a look at the s p 500. Bond yields moved up at the open and then moved up again in the middle of the day. Didnt seem to have a big affect on stocks. About 11 00 eastern we just started drooping lower here. Lets not quibble. Were at the lows. A lot of people have been wondering whats going today, and what you do is you try to look around and what fits the trading facts. What fits the trading facts is were at the end of the quarter and theres a tendency to sell the winners and buy the loser. The winners this quarter were solar stocks. They had big gains. Biotech stocks had big gains, and thats the xsb. Thats steel stocks. They semiconductors, excuse me. They had all big gains. How about what were the losers in the First Quarter . The losers in the First Quarter were oil service names. They were down big. All these names were to the down side almost every day the last month and look at them today on the up side. The volume is much higher than normal. Tyler, i think sell the winners, buy the losers. S i think that makes a lot of sense right now. Back to you. Thank you very much. I know that you and mark do take a longer term view of the markets, but just a quick comment on what you think is happening today. Do you think its just a case of rebalancing and rotation ahead of the quarter end, or do you think the potential for a bigger pullback at stake here . I think people are going to come in and buy this dip, and so i think thats exactly what im doing because if i look out, you know, two and three and four years, this is a great opportunity to buy good names. Specifically domestic small cap securities. I think theyll do really well playing catchup versus last year when they were down versus pairtively to the s p 500. Instead of watching my screen, im out there trying to continue to talk to competitors and suppliers and anybody else that can give us insight. I like mens warehouse. I think that theres a shortterm cloud over that stock with the acquisition of joe banks and then getting rid of george zimmer. I think its a great opportunity to buy that company with 6 in earnings power out to 2017. Also, i like dst because of the valuation. Traded six teams ebida to eight to 12 times ebida. I think theyll do well in this environment. Both of them are down today. Mens warehouse only by a little though. Whats your read on whats happening today in the broader environment . Well listening to bob earlier, mandy, you know talking about biotech and Solar Companies being the best performers, i cant see how we at Intrepid Capital could find a cash investment in that part of the market. For it to be corrected is not surprising. You know i think as sandy mentioned, if you look year over year s p is up probably 14. Russell 2,000 Small Cap Index up 8. Theres a lot of names to look at. You know i think on kind of a fwloebl basis to me if you look at the market compared to gdp, were back to peak wez saw in 2007 and not quite to where we were in 1999. I dont think theres broadly cheap stock prices today, but there are things, some which sandy mentioned. The couple that ill mention. One is tetritech. Its a consulting firm. Consulting engineering firm. Its about a 25 share price. We think its valued in the low 30s on a private market valuation basis. The next one is a bigger market cap. Its run by howard marks. Its oak Tree Financial out of los angeles. Its a 90 billion basically hedge fund manager. Its a part of jeff gundlocks firm, double line and the shares are at 52. They pay it nice as i like to say here. Theyre working the low 60s. I think on days like today you have to undervalue securities and always try to weed out the overvalued ones. Just to repeat you like Oak Tree Capital group. Since you mentioned gdp, speaking with Steve Liesman a moment ago, she was telling us about how gdp has been coming down. Jp morgan also cutting their gdp. Adding their name to many others. Do you feel that considering the fed is repeating that it is data dependent, that this changes the equation for when were going to see that first rate hike and it does it matter to guys like yourself, mark, in the grand scheme of things . Well ill have to admit, mandy, weve looked wider and farther than we ever have in terms of looking at more international securities. In fact, i bet inside our firm weve had more overseas picks than domestically. Yomg as americans we should be happy with minuscule gdp growth rate. As far as the fed it kind of reminds me of the old doctors that used to bleed you, you know, for whatever problem you had. I question whether that policy is really working. You know weve got a low Labor Force Participation rate, and, you know i just think weve got to figure out a way to grow what were doing is not working. Good to speak to you. Thank you for your time. Lets go to power lunch. Cnbc. Com for the names that mark is betting on in the global markets. Power lunch. Cnbc. Com. Ty. Amid the market volatility. Where should you put your money now . Weve got eight stars worth of Investment Advice coming up next on this red day on power lunch. Hey, girl. Is it crazy that your soccer trophy is talking to you right now . It kinda is. Its as crazy as you not rolling over your old 401k. Cue the horns. Just harness the confidence it took you to win me and call td ameritrades rollover consultants. Theyll help with the hassle by guiding you through the whole process step by step. And theyll even call your old provider. Its easy. Even she could do it. Whatever, janet. For all the confidence you need td ameritrade. You got this. Zeefshlgs some of the biggest chip stocks are taking a hit in todays trade. Lets take a look at the i shares, sosx. Its at its worst levels right now. Its on track for the worst day since january 6th. Among the big losers are shares of sky works stlugss and Land Research and nvidia down by 5 or more for most of them. Traders are now eyeing possible support for the fund around these levels. This is where the 50day moving average or shorter trend trend line is. A lot of these Semiconductor Stocks have seen very strong charts. Speaking to bobs point earlier, maybe a good amount of profit taking on one of the big winners this quarter. Back to you. Zeemplts the newer messenger platform. Theyre expand it out to help companies connect with businesses and individuals businesses connect with consumers and consumers connect with businesses using that messenger platform. David marcus who is the head of messenger used to run pay pal. He said that the activision has to really reinvent shopping. Now if you want to get an update on when a product is shipped, if you want to ask a company a question about something you say you want to order online, you can do it all within a single threat of conversation on messenger instead of having to send a lot of emails back and forth. This is an idea of reinventing the Shopping Experience through the messenger bess platform. I also want to look at the spherical video and how he explains sort of the future of Virtual Reality and saying Virtual Reality has a lot more than just gaming. Its awes going to transform the way we look at images and video. Take a listen. So soon were going to start supporting spherical videos and news feed. People already watch more than three billion videos a day in news feed and its some of the most engaging content in our system. Were going bring it to occulus 2. Youll be able to put on your headset and just feel like youre really there. Theres more going on right now. The theme across the whole developer Conference Today and tomorrow is how facebook is more than just a social network. Its a whole family of businesses of products and Ad Technology, we expect to hear a lot more about how facebook is going to launch ab ad product to deliver ads not just to facebook, but across the mobile web and how theyre going to be taking on twitter and doing that. Back with more. Guys. Julia, thank you very much. Josh lipton is here. Zuckerburgs tshirts are getting tighter. You can afford a lot of good trainers when you have that much money zoosh he is caught up there. Americans have invested billions of their retirement dollars in mutual funds. Were not talking about his work. Accordingly, the business those funds invest in thought to be safe. Reliable bets generally. Thats why you buy a mutual fund. Opinionically traded companies with a long history of delivering value to shareholders. Increasingly are starting to place bets on private tech firms. By invitation only. Thats right. The 11 digit club. Startups valued at 10 billion and higher. These are the companies that all the big mutual funds want i piece of and yesterday fidelitys will danhoff told us as much. Its very important for me to understand whats happening in the Innovative Private space where the young people are going, and i think its been very good for my shareholders, and, you know every market is cyclical, and, you know we look at a lot of private companies, and im just buying what i consider the very very best of these companies. Good Business Models cash generative. Lots of users, and rapid growth. Four that attract some of the most attention right now, of course include air b b, and the last people to rent their residences, whether thats an apartment or castle. The startup has raised nearly 800 million at a 10 billion valuation. Then theres pinterest, which is billed as the worlds bulletin board. Users post pictures of whatever really interests them. Thats clothing, pets. That startup has raised more than 1 billion at an 11 billion valuation. Third on the list is a startup that keeps attracting a ton of fans. Snapchat where users take a photo and then it disappears. Now, comscore says the site attracted nearly 32 million unique visitors in february in the u. S. A new alltime high. By the way, thats just 18 over. Snapchat has raised more than 800 million at a 15 billion valuation. The biggest and baddest of them all. The ride haling app has some 5 billion at a more than 40 billion valuation. Its now available in 55 countries. It feels like there are more and more startups demanding such impressive value wags. Thats because there are. There were about 40 Tech Companies that entered the billion dollar club last year. That was a 150 yearoveryear jump according to cb insights. Tyler, back to you. All right josh come on over here. I just want to test the viewers intelligence here. Which two of these three guys lives in california . Which two . Who has the darker makeup is sdmroosh im saying who has the tie on . Josh, great to see you. Stwloo you have a plane to catch. I know. Im going to bring in Herb Greenberg, partner at pick Square Research and contributor. You have lots of nice titles herb. Had he come and go. Should investors be concerned if their mutual fund is investing in whether they are called private placement or stocks that are not publicly traded. Is it a worry . Im not especially worried about it for one thing there are requirements that a mutual fund cannot invest more than 15 of assets in illiquid securities. The Main Investors growth funds are typically investing a lot less than that 15 . So theyre small. Theyre not even up against the margins. Do most mutual funds, most equity mutual funds invest in these illiquid securities or is it a real small percentage . The vast majority of mutual funds, equity mutual funds, are investing exclusively in publically traded stocks. Its mainly growth funds, and even there a minority of growth funds that have been investing in the private companies. Right. Obviously, herb, if you hit one of these as t. Rowe price has done more famously than maybe anybody else. They are the leaders in this fwrsh you hit one of these, you can do well for your shareholders. If you miss just like if you miss with a company that goes out of business, you can lose money. Theres an ulterior motive. Theres a bigger story that everybody is missing, and its not just why they do it for that big pop, but for these funds, you have to understand these stocks come out and theyre very small public funds to begin with. These stocks zoosh when they did public sfwloosh when they go public. These stocks tend to have very theyre the ones that genrate a lot of short sellers. They become bull bear battles. They end up for short seller has to pay a lot of money for these and these mutual funds can charge. They make 8 10 , 12 . Its better than fixed any fixed income investment. We miss you, mesh. Come back more often. The west coast is still working through congestion caused by the port standoff. Can coup an uber for trucks be the solution . One company is betting on it. We have that story coming your way in the second hour of power. Also, as we head out, another look at the nasdaq 100 heat map. Look at that. With the exception of five stocks it is currently all in the red and down by 1. 5 . Do not go away. Now with the xfinity tv go app, you can watch live tv anytime. Its never been easier with so Many Networks all in one place. Get live tv whenever you want. The xfinity tv go app. Now with live tv on the go. Enjoy over wifi or on Verizon Wireless 4g lte. Plus enjoy special savings when you purchase any new Verizon Wireless smartphone or tablet from comcast. Visit comcast. Com wireless to learn more. The market is off its lows. What had been greater and its now 138. The s p 500 off 16 points. The nasdaq off a stiff 79 but that is better than it was. Only four, folks, of the nasdaq 100 stocks are in the green right now. Mandy. It could become ty the most expensive painting ever sold. Robert frank is here with that story and the papting. There it is. Its gorgeous. If you bought this picasso in 1997 you would have done twice as well as the stock market. Well explain why its so valuable and give you the shocking price when we come back. First impressions are important. Youve got to make every second count. Banking designed for the way you live your life. So you can welcome your family home. For the first time. Chase. So you can. In new york state, were reinventing how we do business so businesses can reinvent the world. From pharmaceuticals to 3d prototyping, biotech to clean energy. Whether your business is moving, expanding or just getting started. Only new york offers you zero taxes for 10 years with startup ny business incubators that Partner Companies with universities, and Venture Capital funding for high growth industries. See how new york can grow your business and create jobs. Visit ny. Gov business another big hour on tap as we stay all these markets and just show you how one major group suddenly has become. Plus, why europes problems may impact your 401k. Not in a good way. Unless you do one thing to protect your investments. Well tell you what that is ahead. A bunch of stock picks and one often ignored part of the market and also pay some nice dividends. Watching tyler and mandy always pays dividends. Lets go back right back. Right back at you. It could be the most expensive pabting ever sold. Robert frank has the details. Foo if you think stocks are expensive, though not today, take a look at picassos. Christies announce this 1955 painting by picasso called la femme, estimated around 140 million. It could be the most expensive piece of art ever sold. The Current Record holder is that francis bake oen sold for 142 million. This picasso is regarded as one of a handful of his greatest masterpieces. Christies calls it the greatest picasso still in private hands. Get this it was sold in 1997 by terrorististys for 31. 9 million. If it trades for 140 million, it will have more than quadrupled. He was it is second top selling artnist the world. Sales much 449 just behind andy warhol and ahead of francis bacon. Well see if he breaks the bacon record next year. Do we know who the seller is . We dont. We sort of know we suspect who bought it in 1997 but this could have traded many hands sense then. Privately. And you see a lot of pictures now flipping every couple of years for two, three times what they made. If you like to discount thank you very much. This bull market we know its eventually going to end, but its want going end today. The fed was real clear. They gave us the playbook Going Forward. Its going to be data dependent. Bad Economic News is good. Good Economic News is bad. Rising dollar is bad. Falling dollar is good. This morning we got bad Economic News. The dollar is dropping. To us this is a buying opportunity. Were sitting on some cash in our etf, and were going to be putting that to work. Math matt you say you know the bull market is going to end. Bull markets end. It all happens ethwell. When do you see it ending and how . What will be the trigger . How do bull markets die . Right . Well bull markets die very slowly. Luckily for us they dont die overnight, and our research pretty much puts the end of the bull market somewhere around 2016 somewhere towards the end of 2016 most likely. The beginning of the end is going to be once the fed starts exiting the market and we all know thats going to be sometime. We just dont know exactly when thats going to be yet. All right, matt. Thank you very much. We appreciate your time. Okay. Lets get to a market flash. Dom. Heres whats happening. Shares of ecommerce and online retailer zulily are getting a pop, and thats on the heeflz being mentioned at the facebook Developers Conference happening right now. Our julia borstein is reporting that zulily is an app being mentioned in the presentation. Some traders are looking to see if that could mean a relationship between the two companies when it comes to retail on facebook as lat form. Facebook saying that its one of the things that they can do. Businesses can use facebook applications and its analytics to help businesses like again, in this case here tyler, whats happening with zulily. Whats happening for you, guys is this. Its a little off the lows of the day, but its going to be an interesting next two hours. Sfloot dow down nearly 200 points. The nasdaq off 1. 7 . The dollar index is down but oil is actually back above 49 a barrel. That is a rare fwreen arrow today. We are talking about the biotechs. You are looking now at the ibb. That is the biggest biotech etf. It is down for the Third Straight day, and, in fact has lost nearly 4 over the past week. Remember we had a bowe tech on last friday who expressed concern about some of the valuations among these names. Among the biggest losers reason . Celdex and neuroscine biosciences. How bad has it been the last couple of days . The 150 or so stocks we track on fact set, only 11 are higher. Here are some of the best of the biotechs in that time. Immunogen, endocyte and hyperion. Tlrm only four that are higher this week. Momentum good on the up side but it can ruin you on the down sird. Thats a voluntarily at the time well bring you. We talked about the difference between the larger biotech performers and the smaller caps. The Semiconductor Index down after being down earlier if the day. Anything to do with flash. Samsung had basically pulled back its order. Samsung being the largest supplier of dram in the world. Pulled back orders for equipment. For union are or two quarters. That sent a lot of panic into the sector. Were seeing names like micron down by 4. 7 . Also, take a look at the semis touched by pcs. Brian, weve been talking about this. Nvidia losing the license from intel. Sometime soon in 2017 or so. Again, were seeing that concern about it and a lot of these other pcrelated pc exposed chip stocks. That is really pressuring the index today. It is. Whats interesting too melissa, yesterday, david of Goldman Sachs came out with a report that basically suggested you want to buy certain sectors that are going to be heavily influenced by buybacks of their own stock. They noted that Information Technology had the highest perrage weight of buybacks over the last year, and he was effecttively saying if you buy the buybacks you need to buy t. The market seems to be completely ignoring that today. Well he is basically saying that were if anything to buy back blackout, right ahead of earnings season because 70 of the s p 500 reports during this few week period and so were in the blackout right now. In addition to Technology Consumer discretionary as well as financials were the sectors flagged. We love bright spots, right . You mentioned oel. Take a look within the oil sector. What is leading the equity side higher. Its the first time the drilling rug count has fallen below 100 more than five years. Weve been talking about the selloff broad loy fast money tonight, but specifically about biotech. Ill be speaking with the ceo of what had been one of the hottest biotech ipos ipos d in december. June joe not doing as well as you can imagine. We will have the exclusive with the ceo tonight. All right. Melissa, thank you very much. Okay. This is what we call a wall walk. Heres a camera. The market overall not fairing much better. The dow down 200 points. Was down more than that earlier on. Here are the sector that is are dragging us down. You can see pretty much all of them except for, as melissa just talked about, energy. It is up 1. 6 . Thats kind of a catchyou will all term for oil and gas, and Consumer Staples being driven by the heinzkraft deal. You might notice theres noesh guy on stage with me right now, brian bellski, chief investment strategist. Good to see you. Thanks for coming in. What do you make of this . You just heard a guy in the 1 00 hour say he is not worried. Are you . No. You know cycles are part of big secular trends and i dont doubt that at some point, brooen, we need to take a respite after a big bull market year since twooun. Number one issue is that were finally seeing what i like to call the great unwind of the former trade, the former trade where commodities, emerging markets, the dollar. Okay . Now the second part is the great unwind of macroinvesting. We seem to have sxraektd overreacted to every single little macrodata point, and i believe that the tren Going Forward will be all about bottoms up fundamental stock picking. The more you rely on macrodata, the more youll continue to underperform, and thats why you see these reactions. Especially after given the fact of how much the market has been up. Who can blame the not the professional investors that watch cnbc. Im talking about mom and pop pop, right . Maybe you have an Investment Plan or 401k. For years you know whats worked . Buy the fed. Now it appears to be buy the ecb. These macrocalls have driven people into risk assets. Youre telling them now that may no longer work as a whole investment strategy. Heres my retort. Wall street actually has done a really good job diversifying our clients money, in terms of private client. Remember in the late 1990s the majority of assets in america were in equities, right, and then we had the tech bubble, and then we really started to work with our clients in the private sect auto side to own a mixture of bonds and private ebbing kwet and other assets and in equities in general. Theyve been slow to come back but theyre starting sloeg slowly to come back. Theyre much more diversified and disciplined than say, the Hedge Fund Client i got off the phone with freaking out because zylinx is down today. The majority of retail accounts in america are actually outperforming institutions this year because they have stuck with their guns and invested and have a process versus reacting to every data point. Obviously, this network and our focus, the stock market the economy getting people wealthier, right . If you go back is00 years, the stock market, the much maligned market, everybody hates a stock market, the millenials think its rigged. Whatever it might be. More than 100 years the stock market has been the single greatest money making vehicle over real estate bonds, gold. There are more mill enwrals working now than retired boomers. When they hit that peak earning age, theyll have to do something with their money. Think about this. When they start seening up for their 401ks and putting money in there hopefully they already have. Start early. Hopefully they are buying they are Company Stock too as well in terms of from a longer term perspective, right . Think about this. What are they going to buy . Cheap index fund right . 25 basis point fees. Get yourself a van garde. Spy. Boom. Dont even think about it. Heres the deeper point. Theyll be looking at the product within their sleeve thats been working. Whats been working . Large cap u. S. Equities value, dif debbed growth. I feel like we should have an eeg ol our shoulder. I love the optimism longer term. Bumps in the road. The lesson is clear. Think longterm. I love the demographic look of the United States by the way, in 15 years. I hope im still around with this job. I dont know. If it is its going to look great. I hope so too. Dont eat as much bacon. Facebook shares down today as the company picks off a twoday developer conference in san francisco. There are 45 analysts with the buy rating great to have you with us. Is there anything that came out or maybe more bullish on facebook . Nothing really has changed our view in a big way. Theyve had some pretty good announcements around their messenger platform and opening that up to developers and theyve got some new things in the ecommerce area zulily was being mentioned in the show earlier as a merchant that has signed up for a new communication trial. A lot of things will be moving facebook in the right direction wherebying we still think they have a lot of momentum. Pretty good chance of us being able to raise our estimates as we go through the course of the were. Theyre clocking 60 ebida margins, and thats really high for any company, and especially in this sector. Its hard to see how they can expand those materially. That said, you know its the most popular mobile app in the world, and one of the most popular Media Properties in the world, and, you know theyre still improving. I think theyve got a long way to go. Yet this is a stock you wouldnt touch. I mean i understand that youre more focused on enterprise meaning business oriented stocks as opposed to consumer oriented stocks, but, i mean what would it take to get you to take a look at this . Its up 29 over the past 12 months. Not too bad. Not too bad. What i really want to see because were longterm holders, is for the company to shift more towards i guess being a selling engine as opposed to being, you know our life engine. Theres commentary from all sorts of people but when we go to places like google to look up information and pricing, and thats really what advertisers pay for. Its not necessarily just for establishing your brand on facebook. The zulily today, that announcement thats kind of interesting, but wron that a whole lot of people just naturally go to facebook to try to find a deal. How do they flip that switch michael, and is the payment via messenger app part of it . Facebook is not yet an ecommerce platform but it is definitely one of the highest producing advertising platforms that Consumer Companies can use to reach their customers. Ad prices on facebook are very high, and the reason theyre high is because theres a lot of great engagement that happens and the ads work really well. They tend to be targeted. Facebook definitely leads the pack in terms of the amount of data and the type of data that it has on their users. Its one of these things where, you know google doesnt make a lot of money by selling things like amazon does but they certainly do play a big part in the search process and in the discovery process. Facebook is doing a great job for Consumer Companies like getting products in front of them. I would say thats an area they really excel at. Guys great discussion. Thank you, Michael Graham and kim forest. Thank you. Heres whats on the menu for the remainder of this hour. Could todays market slide be a bigtime buying opportunity longer term . Were going to dig in ahead. Plus, more on that deal of the day. Heinz and kraft joining forces to become one of the worlds biggest food companies. We are going to ask who could be next. And our good friend Herb Greenberg is ringing the alarm on one for Profit Education stock thats getting slammed right now. Herb is in house. He will join us ahead. Speaking of getting slammed, just a reminder the markets deep into the red today. The dow down 212 points. Just a couple of points off its lows. We are watching it closely. Oil is on the rise. Saudi arabia reportedly amassing troops on the yemen border. A lot going on. Were back right after this. At mfs, we believe in the power of active management. Our teams collaborate around the world, which leads to better decisions for our clients. Put our global active management expertise to work for you. Mfs. There is no expertise without collaboration. Female announcer sundays your last chance to save big during sleep trains triple choice sale. For a limited time you can choose up to 48 months interestfree financing on a huge selection of tempurpedic models. Or choose to save hundreds on Simmons Beautyrest mattress sets. You can even choose 300 in free gifts with sleep trains most popular Stearns Foster mattresses. The triple choice sale ends sunday at sleep train. Sleep train your ticket to a better nights sleep sdmrimplt your deal of the day. Probably right now deal of the year. Kraft saying it will merge with heinz. Heinz will really control 51 of the company. Heinzs ceo will become head of the combined company, but no doubt Investment Bankers in the Food Industry are scrambling to think of other deals so who might be next . Dominik joining us now with a look at that. I guess we should chew on this. I see what you did there. Heres the thing. If you take a look at the food stocks, remember analysts are already weighing in. You had folks at Credit Suisse saying campbell could be the next target. Mondolese could be the next target. Everyone has a view. We asked our partners over at market data and Analytics Firm to take a look at big outsized performers on the first day after a major food deal is announced. The biggest moves in within day amongst snft biggest names. 18 deals theyve looked at major food and beverage and staples type mergers that have happened sense 19 8, and this is what they came up with. The big standouts, campbells soup on average over those time periods is up a half a percent on days after a big food deal is announced. Now, today those shares are relatively flat. Well see f that changes. Conagra foods up on the announcement that thats just about where it is right now. Well see if conagra can stick to the averages. Cisco shares up by nearly 20 . Not the computer net world war iing company, but the food distributor. Theyre up 1. 9 . Those shares also maybe not as much of a performer today. All of these names and more are all up on cnbc. Com pro. Right now you can see the full story there as well as maybe some of the analyst pics for what happens when another food merger does come about, and next hour, again, in the closing bell, were not just going to look at oneday trades. Were going to see which of these companies actually does well just a mornings even a month after a big food deal is announced. Melissa can hold on to those gains a month later. There is a company that dom left out. It is not u. S. Based, but its u. S. Head waters is about 50 yards to our right. Unilever. Interesting. Snoo thats a big one. Meantime the search and Recovery Efforts are underway in Southern France following yesterdays tragic plane crash in the alps. We know now that three americans are among the 150 people that were killed when the german wings plane went down. Lets bring in phil lebeau. What do we know at this hour . Melissa, within the last couple of hours weve gotten the first briefing if you will from french investigators and some encouraging news that they have been able to get some data from the damaged cockpit voice recorder. Unfortunately, for those of us all of the world watching and wondering exactly what happened during the last ten minutes of flight. They are not giving out any information. The recorder was damaged and is usable. Theyve been able to extract some of the audio, and the sounds from it. They are not giving details about what happened during those final nine minutes of the flight, and just to refresh everybodys memory again, this is what is so confounding to everyone. You have a flight that went from 38,000 down to 6,500 feet in i very steady and orderly descent, but no communication between the pilots and air traffic control. By the way, the question has come up what about the second black box that they are looking for . That being the flight data recorder, which records a whole slew of pieces of information data of where the plane is how the plane was configured how it was operating. They have found the case that holds that black box or the flight data recorder that they have yet to find the second black box, which is the flight data recorder. Melissa, i think the bottom line here is that its going to be some time before they give much information out about what exactly happened towards the end of that flight. Thank you very much phil lebeau. On deck we are going to get back to the markets. Its buy the motorcycle, but sell the electric car. Those are some of the big calls. Were going to hit them in street talk, and were keeping a close eye on this market. Youre looking at the nasdaq 100. Wow. Only four stocks in the nasdaq 100. My math tells me thats 4 are higher right now. There you go. Kraft, of course on that list. Mondolese, another of the food names. Direct tv, and sort of oddly, vip, the russian name as well. By the way, Oil Continues to march higher. Now well above 49 a barrel. We are back right after this. Welcome back. The dow down 193 points. Not on its low of the session, but not that far off. The story is quickly becoming the nasdaq composite. It is down about 1. 7 . We just showed you the nasdaq 100. Only four stocks. Two minutes ago theyre higher. Well check that. It is now only three. I should say the worst performers are invidea, biogen vertex pharma and celgene. Those are the worst performers this week. Theyre down 9 8 7 respectively. Now time for street talk. Lets find some opportunities. Hitting five stocks with news or Analyst Recommendations just for you. Lets get to it. Lets do it. Stock one, harley davidson. Stifel, starting coverage with a buy. They have a 75 coverage. 25 up side. They like the product invasion. They have the dart custom platform, et cetera as well as the potential for dividend and buyback opportunities. They called a valuation reasonable. I think theyre even looking into a hog, brian. Take a look at the stock chart. Its fallen and been treading water. It will be interesting to see if the good performance on the down day overall. Stock number two here tesla. Underperform from an outperform. Cutting the price target to 220 from 275. The loits sees risks to the near term earnings from a lower model x margin. Weve heard this from other analysts before. Longer term though the analyst says the stock is attractive and does see signs of progress in china and a promising stationery storage opportunity. Aka batteries. Yeah. This is our electric car reference a couple of moments ago. Its a terrible looking technical stock from technical analysis. Lower lows and lower highs. Lets not forget it was a 290 a share stock down in september. Its down 30 just since that time. Stock three, groupon. Up it to a buy from a hold. They surveyed about 300 consumers, melissa, and they saw some Strong Demand in america. Also, they boosted their growth target and the stock from ten to six. Thats a 30 up side. Keep in mind this was a 12 stock in january of last year. Its kind of interesting because of those 300 they said 78 of recent buyers would actually buy again within the next three months. Another part of this call is the pullback in the stocks so far this month, its down 7 . Thats interesting. Stock number four here, starwood hotels. Sun trust cutting from a neutral to a buy citing greater exposure to the luxury and upscale segment. This is part of a larger call on the lodging names. Down grades getting hit. I know they mentioned Foreign Exchange transactions in that call. Whats weird about it is you hear this battle between bringing back profits and having to deal with the currency adjustments or more people traveling to europe because the euro is down and its cheaper. You wonder if it would balance out. Either way, the price target 84. 2 and change above the current price. Well see analysts come out of the wood work to try to defend some of the names. All right. Stock five as always is our under the radar name. Kind of a smaller cap. You may not have heard about it. Today it is ultra genex pharmaceutical. Crt capital starting coverage with a buy at a 90 target. That implies 50 up side. Jeffrey is weighing in. Less aggressive at 74 but still bullish. Want under the radar for fast money viewers. Weve had the ceo on last year. Bold call because earnings are tonight. How could i ever forget that interview . I just age. Just rolled my eyes. Every day, melissa. Thank you. Up next a rare but welcome in house appearance by our buddy Herb Greenberg. He will detail what is now a spectacular drop for one for Profit College stock today. We are keeping a close eye on oil with just a few minutes to go. Were seeing some buyers coming to do oil picks. Swraky, set us up to the close. Thats exactly right. Weve got buyers coming in today, and not for the usual reason. We are actually defying all of gravity in temz of the bearish numbers. Im going to talk about what new cavat is on the table here driving the Oil Trade Higher when power lunch returns. Stay with us. Theres nothing more romantic than a spontaneous moment. So why pause to take a pill . And why stop what youre doing to find a bathroom . With cialis for daily use, you dont have to plan around either. Its the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision or any symptoms of an allergic reaction stop taking cialis and get medical help right away. Why pause the moment . Ask your doctor about cialis for daily use. For a free 30tablet trial go to cialis. Com im sue herrera, and heres your cnbc news update at this hour. U. S. Officials say saudi arabia is moving heavy military equipment, including artillery, to areas near its border with yemen, raising the risk the country will be drawn into the worsening yemeni conflict. The white house says the u. S. Is providing intelligence and surveillance support for the military operation to take back. It had no comment on additional policy decisions there, however. Iraqs president says the u. S. Led coalition will begin air strikes against isis targets around soon because the fe by iraqi forces has stalled. At least six people were killed and more than 30 others injured after a suicide bombing in kabul. The car bomber struck close to the president ial palace in the heart of the city. The vehicle was packed with explosives. The Treasury Department has announced a 7. 7 Million Dollar settlement with pay pal for violations of numerous sanctions programs, including those against iran cuba and sudan. It said the company also processed payments from a person on the treasurys sanctions black list. That is the cnbc news update at this hour. Back to you, brian. All right, sue. Thank you very much. Well, oil popping late in the afternoon. The final trades crossing the day. Lets go down to jackie at the nymex. Jackie, this report on saudi arabia, are you hearing people there talk about it, or is it Something Else . Absolutely, brian. That is the factor that we havent talked about in quite some time. This geopolitical risk coming back on the table shifting the focus away from the supply demand story, shift it away from the dollar story as well. Reports out, of course that yemen and air force base there formerly used by u. S. Forces has been seized by rebels. Its also that Saudi Arabian troops are amassing. Its not necessarily an oil producer but when saudi arabia gets involved, in anything traders here start to worry about it. The reason saudi arabia is getting involved is that these antigovernment rebels are supported by iran, by they are shiite rebels, and there are also reports out that the president has fled the country. That is what stoked this near 2 pop in oil prices today, closing well over 49. We didnt think that we were going to see that when we got an eight million barrel build in inventories here in the United States. Brent prices right now, 56. 49. Theyre up 1. 38. This is just really interesting because we havent talked about geopolitics in quite some time. This brings that risk back on the table. Traders have been warning me of this for quite some time that theyve been watching yemen very closely. This is something to keep an eye on for sure. Back to you. Yeah it is a biggy. Jackie, thank you very much. We appreciate it. Also, this is worth repeating because it goes to what jackie was saying. Just just happened in north dakota that has not happened in five years. North dakotas active drilling rig count is now back below 100 rigs. It now stands at 98 rigs as of this morning. That has not happened since 2010. Big concern out there over whether north dakota can keep up its daily production of barrels. About 1. 2 million given the shrinking rig count. Lower production might mean higher prices. Oil above 49 a barrel but good friend of the show Boone Pickens predicting that oil will double by the end of next year. Speaking in california last night, pickens said 100 a barrel by the end of next year is also predicted 70 a bir rel by the end of this year. What gow think, dear viewers . Send us your Oil Predictions or thoughts at power lunch on twitter or our power lunch page on facebook. Well one oil related group that has been out of the spotlight a bit lately are the Master Limited partnerships. Otherwise known as the mlps. They tend to be pipeline transport, refining related companies and are known for passing through income in the form of high dividend yields. There are a lot of them out there. Do not sweat the technique. Mkm partners jonathan put out a concise Research Report this morning highlighting mlps that he says are buys and sells based on his technical analysis. He could not join us today, so were going to highlight some of the namsz that he did highlight according to his technical analysis. He says buy, are you ready, it alon partners Buckeye Partners capital products Enbridge Energy transfer partners kinder morgan, and se group. He says sell. Center point Energy Natural resources, sedro partners and tk off shore. Im sure you missed most if not all of these names, but do not worry. Were going put this segment. Were going to cut it put it on powerlunch. Cnbc. Com so you can get those names. Melissa. The nasdaq biotech etf is falling for the Third Straight day. Lets bring in cnbc biotech reporter meg terrell and, meg, we started talking about the last week. It lands in the wall street journal today. Its reached Mainstream Media essentially. Now wha . Thats right. If you are looking at the biotech index, everything is red today. If you look at the biggest names, amgen, celegene and biogen. Its the smaller names that you have highlighted a lot that are seeing the biggest losses today. Novavax, newly genetics and leading the index lower. Other names really were just hearing about a lot of fear in the space. This threeday losing streak is the longest for the nasdaq biotech index since february 4th. Ive been talking with a lot of investors, a lot of industry folks just about whats going on here. Is this a bubble . Are we seeing the end of it . Are we seeing the end of the rapid rise . The nasdaq biotech index over the last five years is up 280 . This is really go go go. What a lot of people are saying is this is a lot of fear coming in. This is three days this week. Then its been bad. Thats playing in here. A lot of other folks say its about whether you think the valuations are too high. Is this ending or coming to an end, and there are arguments there. People say say these are worthy based on the profits and revenues and promise of the people liens. Other folks say this is crazy no matter how great these companies are. Prior to this big bull market, it had been according to a lot of analysts, an under invested sector because it was doing poorly. Maybe this is catchup. Absolutely. What im hearing now is its such a hot space that Fund Managers and biotech are getting too much money. They dont know where to put it. If theyre looking for things sflo theyre chasing. They dont know where to go with it. Its so much money is coming in. Thats why people are saying maybe theres froth going on. Thanks a lot, meg. Of course. Thank you very much. Now lets continue our focus on the nasdaqs drop as part of our new trading nation segment. Weve got ritual yas of ever corps isi on the charts dooef seaberg focused on the fundamentals. Rich, first off, lets go to the charts. What do they say . Could it get any worse for the nasdaq 100, or should we expect a reversal and a continuation of a bull market . You know i think todays bull back is simply necessary pause within the context of an ongoing trend here. We see a lot of fear but lets not get emotional out there today with 96 of 100 members of the ndx 100 down. That tells me the selling is i object discriminate at. So bad its good. Bring up the chart and ill show you how to trade it. When you bring up this chart, brian, the first thing that jumps out at you is the double top resistance. The double top has been overplayed. Its over used. You want to keep an eye on the key supporter in the 4,300 level. Thats your 50 day moving average. A break below 4,300 admitly opens the door to a further fest test of the 150 day down around 4,200. I dont become really nervous until we break that 4,200 level. I dont think that happens, brian. You want to take advantage of todays weakness. Over the next few sessions, if we see further weakness. The nasdaq goes higher. I think were 5 to 7 higher by the middle of the summer. You have to buy these pullbacks in these strong up trends brian. Theres your technical look. He likes the market. I was just looking down at my screen. Theres about 25 or so nx 100 names with a pe a trailing pe of more than 50. Are you concerned some of the valuations have gotten over stretched in the near term anyway . Individually wills no question about some valuations are stretched, but in general i hear the word fear being used quite a bit on the show today. Theres no fear. Were not seeing fear in our guests at all. Especially biotech. I mean the segment earlier you talked about a fear that valuations are stretched. Theyre moving out of the names. This space had a significant run ahead of this biogen data. Its a pause here. Its not a big deal. Im not seeing the fear or the aggressive selling. I think its lack of buying right now. I agree with rich. I think you should be buying the dips and i would look for additional weakness to step in and buy the stock or buy the market. I think were at a level. Appreciate it guys. We have to cut it short. We appreciate it. We have breaking news right now from scott. Scott, what are you looking at . Ryan, the sex discrimination case that has transfixed Silicon Valley and a lot of Corporate America is now in the hands of a jury. This is the discrimination case by former cliner perk irnz partner ellen poul against the preeminent Venture Capital firm in Silicon Valley saying she was descriminated against and retaliated and fired when she complained seeking millions of dollars of punitive and contempt and competencetory damages. The jury is six men and six women. One thing that may hurry things along is they do not have to come to a unanimous verdict. There are seven pages of questions they are considering now in a jury room right behind me in the California Superior Court building here in san francisco. Brian, back to you. All right, scott. That trial certainly is 18003452550 [ male announcer ] your love for trading never stops tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account, and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so if you get a trade idea schwab can help you take it on. Tdd 18003452550 were getting a lot of questions tdd 18003452550 about organic food stocks. Tdd 18003452550 [ male announcer ] sharpen your instincts tdd 18003452550 with indepth analysis by schwab experts. Tdd 18003452550 and if you want to run your idea tdd 18003452550 by a schwab trading specialist, tdd 18003452550 our expertise is just a tap away. Tdd 18003452550 whats on your mind lisa . Tdd 18003452550 id like to talk about a trade idea. Tdd 18003452550 lets hear it. Tdd 18003452550 [ male announcer ] see how schwab can help tdd 18003452550 light a way forward. Tdd 18003452550 so you can make your move, wherever you are tdd 18003452550 and start working on your next big idea. Tdd 18003452550 tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 call 18776703357. Tdd 18003452550 or visit schwab. Com trading. Tdd 18003452550 schwab trading services. Tdd 18003452550 your goto for trading knowhow. Tdd 18003452550 the eclass has 11 intelligent driverassist systems. It recognizes pedestrians and alerts you. Warns you about incoming crosstraffic. Cameras and radar detect dangers you dont. And it can even stop by itself. So in this crash test, one things missing a crash. The 2015 eclass. See your authorized dealer for exceptional offers through mercedesbenz financial services. There is a lot of red on the screen. Its fwot to be apollo group. Ticker apol. Shares down 20 . Their enrollment tumbling as well. A man who has been waving the red flag on many of the for Profit College names since, heck, 2011 on the old show street signs. Herb greenberg. Are you surprised by these numbers . I think many people are surprised. This is this stock is the real story here. If you look at the round trip this stock has taken because so many people came in. It seemed like the Business Model had been reset. They were now becoming a value name, a turnaround situation, and then to boot, in fact, if you look last quarter, larry robins, took a huge stake in this thing. The Biggest Hedge Fund investor. Five million shares plus, and so you say whats going on . When you look at the Conference Call the company had, they started people were asking questions like, you know, your enrollment Going Forward isnt what you thought it was going to be. Is it because youre not spending enough on marketing . You pulled back on your costs. Companies can only cut costs so much. You cant cut your way cut your way to prosperity. Sfroo two points here. I dont know if larry robins saw this point of view. No, didnt. The hedge funds, we talked about the 13 f feelings. It does go to show you even the smart money isnt always right. I think we talked about this literally about four years ago. Everything you say makes sense. Except to me. But and to me too. I think in this case there are several things you can have where the government is going to basically make Community College a wills less regulation. Its interesting to see how that plays off one another, and if they can the stock is down 28 , meltsa lee. This is a name maybe you guys will talk about on fast money tonight. Melissa, here at the port, orange has always been the new black. Coming up next how the sharing economy is coming to the foreto help unclog it and moving trucks through here at twice the normal speed. Thats after the break. Now with the xfinity tv go app, you can watch live tv anytime. Its never been easier with so Many Networks all in one place. Get live tv whenever you want. The xfinity tv go app. Now with live tv on the go. Enjoy over wifi or on Verizon Wireless 4g lte. Plus enjoy special savings when you purchase any new Verizon Wireless smartphone or tablet from comcast. Visit comcast. Com wireless to learn more. It may be over officially, but west coast ports are still trying to recover. We are turning to a new service to get trucks moving faster. Jane wells joining us now. Brian you know im at the westfacing Container Terminal at the largest port complex. More about that tentative that could be at the bottom of the pile. With cargo mattic theyre on standby like drivers and instead of picking up people they come to pick up containers. The very top container on the pile. Cofounders fred parker and Jonathan Kessler say big retailers are signing on to the experiment. Its a very small experiment here. Not widespread yet. It seems to be the one thing here that both management and labor support. Back to you. All right. Nasdaq is wlgell off the session lows at a level of 4908. Just about ten points off of the session lows on the nasdaq composite. Retailers getting hit today. Courtney reagan is here with more on this. Retail hitting a lot of different things. The port is one of them. Stocks are down lower, not able to puck the trend. Some names feeling it more thanaries. Best buy staples game stop, and nordstrom. While these retailers and others are spending billions of dollars trying to make consumer happy, shoppers are saying its still not enough. This according to a new survey from accenture. The big Problems Center around inconsistency between platforms and focusing on ecommerce and then under serving stores. Many retailers run it as separate businesses even though shoppers dont see a difference. A huge pet peeve for shoppers is when the same product has a different price online than in a store and that frustration is getting worse not better. 82 of shoppers expect the prices to be the same. 13 more satisfaction than last year when asking that same question. A big problem for twothirds of the nearly 200 retailers accenture assessed globally since only a third have identical pricing for 80 of the products. I actually noticed it at barn two weeks ago myself. Eeks a i went in to look at the price the of this silver snack bowl. Ck it had been cut online but not ot in the store. Frustrating. And while theres so much focus focu on improving online, shoppers done want that physical store st neglected either. Either. 39 say brick and Mortar Stores are in need of the most. Bzz upgrades rather than the websites prabs because so much money has been een diverted to that effort. Thanks so much. Thanks. Courtney, thank you very t much. H. Stocks still solidly in the red. We are teeing you up for a big final hour of trading. Hour of the dow is down exactly 200 200 points. The nasdaq though the big loser, down almost twice as much as the s p 500. Dont you go anywhere. Were back after this. Friday night, buddy. You are gonna need a wingman. And my cash back keeps the party going. But my Airline Miles take it worldwide. [ male announcer ] it shouldnt be this hard. With creditcards. Com, its easy to search hundreds of cards and apply online. Creditcards. Com. [ male announcer ] legalzoom has helped start over 1 million businesses. If you have a business idea, we have a personalized legal solution thats right for you. With easy stepbystep guidance, were here to help you turn your dream into a reality. Start your Business Today with legalzoom. With the dow down 200 points, gets more strategy and advice. First off, theres been a lot of explanations about what might be going, biotech bust, saudi arabia, yemen, whatever it is. Do you guys have a reason you believe that stocks are down today or simply more sellers than buyers . Well, theres a great deal of apprehension about upcoming Earnings Reports. Not only do you have the profits in the Energy Sector declining by 60 , you have major headwinds on the currency side. You have Economic Activity thats been very disappointing. Some economists are moving their gdp estimate down closer to 1 . If you look at it from a currency standpoint, you have had the steepest assent in the dollar since 1985. It has some repurr kutionercussionsrepercussions. Profit growth becomes more problematic in the Second Quarter so companies will guide lower. Agreed, but, carmine but over time as weve shown our. Viewers, stocks and the dollar seem to go in the same direction. That is absolutely true except if you look at other periods where the dollar increases by 25 or more the stock market goes down. Whenever its reached 30 its never gone up. The reality is, yes, in a normal circumstance, this is not normal. So there is apprehension out about there the dollar. Similar problems going into the quarter, into the Third Quarter Earnings Report and the stock market declined by 7. 5 between midseptember and midoctober. So once you get the Earnings Reports coming through the apprehension starts to fade and you start to get i think a similar pattern where the market rallies. So it sounds like if im hearing you right, car mine, for the next three to six months we could have some market pressure but any drop whether its today, next week, or a couple months from now would be a longer term buying opportunity because it would revert back to normal and expectations would be reset. Is that accurate . Thats true. If you look at the reality here i think you could see maybe 5 to 8 pullback in the s p and thats not likely to last very long, and so it does create an opportunity. I think later in the second half of the year you do have a couple of positive dynamics where Profit Growth starts to improve and you continue to have a strong buyback activity, m a activity continues to go at a 2 trillion announcement rate. Very favorable, and i think Investor Sentiment is generally good. Interest rates are going to remain relatively low. The trajectory of rate increases are going to be half what we have historically seen and european rates are low. So i think this is a pretty good environment, but, you know you have to exert some caution especially in some dollar related areas like semiconductors. Carmine, a pleasure. Thank you very much. Melissa . You know what, brian . Tonight on fast money, fast money challenge continues. We started off with 16 stocks in technology. We will continue battling until we get to one champion. You can log on to cnbc. Com pro for a preview of tonights matchup. Our matchup tonight takes place in the payments bracket. We are going excuse me here. Western union versus intuit. Whoever wins this will on to battle paychecks which was a real underdog because paychex. Upstate new york love it. Thank you very much. Thank you all for watching power lunch. The dow down 204 points. Oil is up. Big last hour of closing bell starts right now. Welcome to closing bell, everybody. Im kelly evans down here at the new york stock exchange. And im bill griffeth. A big selloff right now as brian was just itemizing there for you. A lot of moving parts and pieces going on here as we know. Military issues in yemen have served to Push Oil Prices sharply higher today up as much as 4 for both wti crude and brent crude. That has pushed many Oil Sensitive stocks down sharply. The transports for one are down hard