Now by six points onetenth a percent watching all the way to the close. Extremely busy news day, folks. The war between the sunnis and shites intensifying enegypt and saudi arabia are sending in Ground Troops to blunt iranian backed rebel forces there. You can look now at oil. There is west texas up better than 3 above 50 a barrel at 50. 8 50. 86. Yud crude is up. Shocking news on the plane that crashed in the amlelps. And today they say the jet was brought down deliberately by the copilot copilot. We have the latest. Lets show you a picture of the copilot. Thats andreas, 28 years old, and thats a picture of him. We dont have the time frame when it was taken, but people look at the picture saying what exactly was going through his mind in the final moments of the german wings fright that crashed into the french alps. This morning, a french prosecutor said that it was brought down deliberately. The copilot was acting alone in the cockpit. He was alone. Did not let the captain reenter after he left for the restroom. There was no communication from him to anyone else not to air traffic control, not to the captain who was knocking on the door, and, n. ,in fact, the press conference this morning was chilling listens to the prosecutor describe the final moments of the flight. He said look on the cockpit voice recorder you can hear shouts from the other side of the door not just the captain, but the main cabin realizing they are crash into a mountain and realizing the captain cannot get back in to the cockpit. What do we know about the copilot . Hes 28 years old, new in terms of being an employee for the company, 630 flight hours with the a320, joined germanwings in 2013. This morning in a press conference, the ceo was asked about the screening methods for pilots. Heres what he had to say. Translator selecting our people, we dont underlook cognitive cognitive practical competence and give room to psychological capabilities. He went on to say that andreas passed all screens for the pilots brought in. In fact, there was no indication he may have had issues. Guys, theres reports that are surfacing out on the internet. People who knew him saying while he may have had concerns or issues none of that has been verified. Were in a realm of conjecture now where reports will surface coming out in different parts in europe. Phil quick question for you. You said the copilot was alone in the cockpit. Arent there protocols in places like the United States where there has to always be a third person who, if the pilot or copilot leaves the cockpit for whatever reason go to the bathroom, whatever, a third person like a stewart has to go in so theres two people in the cockpit cockpit . Thats protocol in the u. S. And has been since they put in those doors after 9 11. Its protocol in other parts of the world, but it is not protocol in europe. In fact, the ceo was asked about it today. He said well maybe were going to have to assess the situation and change policies but in europe theres no requirement that when a pilot leaves the cockpit that somebody else has to go in and be with the other pilot. So essentially, you have a situation that we saw with germ man germanwings where theres one captain in the cockpit. Thank you so much. More to come on the story if thats the case. Breaking news in the bond market with seven year notes up for auction. Rick santelli is tracking that at the cme. Whats demand here . You know, i gave it a dplus and changed my mind at the last second. The more i stare at it the more i dont like the demand outcome. Capping 90 billion in supply tuesday through today. The yield 1. 792. The bid on a one issue market around 1. 781 bid, so you can see higher bid, lower price. Heres the good things okay indirects at 50plus percent spot on ten auction average, 123 on directs, but not only did it price on the high yield auction, the bid to cover, 2 preponderate 3 it 2, securities available, it was the weakest bid to cover going all the way back to may of 2009. Its the last of the supply. Many traders looking to see if we test 2 in the ten year. No matter how poorly demand is at auction, when supplys over you see markets rally pushing yields down. Well be on the lookout for any movement along those lines in 15 to 20 minutes. Back to you. Okay rick thank you very much. Tyler, you pick up from there. Thank you very much, guys. Volatile day on wall street. The dow swinging between triple digit losses and modest gains now as you see well its gone back negative wherefrom where we began the broadcast. Nasdaq down air strikes by saudi arabia on yemen sparking fears about oil supplies out of the region. That is sending crude higher as you see right there. Bob is on the floor of the New York Stock Exchange and berth sarks uptown at nasdaq, and jack ki is at the nasdaq. I was up at 5 20 this morning, futures down 18 points. I went, woah, this will be a rocky open, but its fizzling away as you see here. We came up and we did actually go positive. The sectors today, well they are close together. Transports have been weak and struggling to get in positive territory, but Everything Else is within a fraction of a point, 1 up or down energy actually was higher earlier on today. Issues for stocks well theres three major issues. Really two. Negative Earnings Growth and high valuations. Combined with the fed rate hike threat. We had a Dollar Strength reversing in the last week meaning commodities are higher copper and gold rally, and geopolitical risk thing. People are sorting it out today. If this was geopolitical worries, dollar would be stronger. Thats not happening today. Bond yields would be down dramatically. Thats not really happening. And even gold you know thats a modest move for gold. Youd see more violent reactions if there was true geopolitical risks outs there. Finally, whats going on is an oversold rally, and if there was real trouble and real worries out there, believe me, you think the vix goes to 20 . Thats my threshold for being worried, vix at 20. No, this is modest moves. Overall, the market is trying to tell us i think yesterday a little about end of the quarter reambulancing going on and a little concern about where the fed is going right now. Guys, back to you. Thank you very much, bob. Dom chu has a market flash. Surging todays trade, red hat, the company known for the work in lennox operating systems for business customers reporting earnings that Beat Estimates thanks to growth in other parts of the company like Cloud Computing, data storage, and Software Solutions and announced a buy back program. You can see the shares up 11. 5 today, one of the best performers on the s p. Thank you. Nasdaq on pace for the biggest monthly loss since last march. Plunging 3 this year. We are following the movers bertha . Think about it the nasdaq is 3 down from its 15year high. Its near all time highs, its a limit bit of a sell off and taking profits as bob talked about. We are seeing rotation. One of the areas where theres a lot of rotation is bioteches. Bioteches on pace for 7 decline, just thursday down the fourth day, worked into positive territory barely well see if that happens this afternoon. Look where they were last week at their most recent alltime high nearly into correction territory there. Some are attracting bids being seen as oversold and chips, thats where we are continuing to see the pain. Sandisk is off, but there, too, you were seeing some names that are really big losers this week starting to atrack bids today. Back to you. Thank you for that from the nasdaq. Saudi arabia beginning air strikes against iranian backed rebels in yemen sending oil prices soaring. This is a video of the aftermath of last nights strikes. Egypt is preparing to send troops into yemen with saudi arabia to attack forces. Minutes ago, head of Central Command was asked by senators in a hearing what happens if the rebels try to close off narrow waterways to shipping . Given the situation in yemen, if they block the strait i presume American Forces were to immediately act to reopen the strait . We would work in conjunction with the gcc partners to ensure that those straits remain open. Its one of our core interest to ensure that we have free flow of commerce through both straits. Well jackie on the floor of the imex whats it mean for oil prices . Good afternoon, mandy. Pricing now, you can see were close to 51 a barrel after we got reports that egypt and saudi arabia send troops into yemen. Whats important to traders is the connection. This is the Worlds Largest oil producer starting conflict on the ground to tamp down iranian backed rebels the shias, and what people are worried about as you mentioned is that thoroughfare where about 4 Million Barrels a day in the strait go from the middle east goes to the suez and off to europe. Any time you have conflict in the region this is something to watch. Its not necessarily about yemen per se. Meantime traders are also saying that, you know, theres different types of crude we use in the global marketplace. Remember yes, u. S. Production is going up but we import foreign crude, not only from opec countries like saudi arabia and iraq but places where theres conflict like libya. Weve seen volatile production in the regions. You cannot necessarily count on whats happening internationally at this point. Thats what traders are worried about. It sent our price over 51 and brent up to 59. 18, and also recall this 1 the wild card weve been talking about for weeks, takes us away from the story of the dollar and supplydemand story here in the United States. This is what traders were worried about. Its the caveat that could send us back to a six handle on wti. Back to you. Thank you very much for that and later on this hour, speaking to ed walker former chief of missionings to saudi arabia for thoughts as well. Trant ports seen as a barometer for the markets and economy, but its been a rough road for the sector. On track for the worst week in months. Whats going on with the stocks . Morgan morgan, you know. Its the perfect storm, on track for first down quarter in two years. Whats happening there and why investors should be paying close attention when power lunch returns. 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. 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Trading at all high time levels firm beating estimates helped by growth in the outsourcing business lululemon shares soaring, beating estimates, but outperforming short, and winnebago plunges 10 , now down 15 , missing estimates because of labor shortages and higher operating costs. Lets get to julia for a news alert. Thank you. Thats right. Hbo and vice media announcing a major deal. This is hbos biggest content deal ever and also the biggest ever deal for vice news. They are going to be partnering on News Coverage and in addition to expanding vices weekly show for hbo, vice launches a fiveday week 30minute news broadcast airing not just on hbo, but also on hbos upcoming streaming app called hbo now launching next month. Key move to move into the News Business and ramp up programming targeting younger viewers. Vice has the edgy take appealing to millennials, and they are looking to add more younger subscribers to the new stand alone streaming app. Tyler, over to you. All right, very interesting. You think they might have gone with cnn, but i guess not. All right. The transports having a bumpy ride in the recent sell off. Breaking today below a key support level. Morgan brennan is looking at whats going on with this widely watched sector. Morgan . I almost called you morgan stanley. I really almost did. Ill take it as a compliment. Lets look at the dow transportation average. This right here is what you want to look at. This is what happened today. Dow breaking below 20 Day Moving Average happening earlier tea. Since, we bounced back. Nonetheless, this is what everyones watching very carefully. Why . Transports are closely correlated with Economic Growth. Now we see the rally in oil. Thats weighing on the group right now, the 210 to trade inversly. You see that with the transportation average etf and the uso, u. S. Oil fund. You see that dynamic right there thats weighing on the group today, but theres a bigger story here. Were beginning to see a slow down. Companies like fedex and Kansas City Southern have been cutting guidance recently. Now we have data thats pointing to a slow down in freight volumes across several modes of transportation. Look at this. Weve got trucking tonnage falling 3 in february from january. Thats seasonally adjusted. Also, look at rail carloads for february excludeing those containers moving through various modes of transportation due to the port backlogs you take those out, and you are down 6 month overmonth, and since then since we get numbers weekly, we continue to see weakness, particularly in coal crude, and metals. Donald bratton says this points to a slow down in Economic Growth. You should be paying very close attention to this. As for whats falling most today, specifically we got Union Pacific falling after several analysts downgrades. Conway also fears were going to see Earnings Growth weakness in the First Quarter, and jetblue airways, and this is not the component of the dow transports, but genesse and wyoming cut last night, falling lower. Meantime, end of the session, dow transports looking at your date, down 5 . This is really key. If we close below 86. 50 today or coming days, michael mentions thats a key level and well see transports continue to fall potentially to 8300. Guys, back to you. Thank you very much. Chaos in yemen, saudi arabia begins air strikes there against rebels trying to overrun the country, and reports of a ground operation in the works as well. Is this going to turn into a wider war . A former u. S. Ambassador in the region will join us. You need to hear what he has to say. Yes, as we head out, though the ten s p sectors at this hour. Biggest loser, discretionary, the biggest gainer is telecom. Were back in two cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. So, how do you feel about cash back . I would not say im into it. But lets see where this goes. [ buzzer ] do you like to travel . Im all about free travel, babe. Thats what i do. [ buzzer ] balance transfers you up for that . Well unh. Too soon . [ female announcer ] fortunately, theres an easier way, with creditcards. Com. Compare hundreds of cards from every major bank and find the one thats right for you. Creditcards. Com. Its simple. Search, compare, and apply. [ ice rattles ] welcome back to power lunch, shares of pharmaceuticals boosting in midday trading. It and a competing firm based in france are working on a treatment for a type of liver disease. According to our own, the Company Announced results for a trial that was not as successful as some anticipated for one component of the tests. Some traders view the news as being more net positive for intercept. The overall trial was said to be successful enough to pursue a phase three trial of the treatment. Back and forth now, but intercept shares up by 10 or 11 . Back to you. Thank you very much, dom. Gold ready to close at three and a half week highs, they are up by eight bucks at 12. 05 and lower dollar. Tell us more about gold. Good afternoon, mandy, well thats right, risk aversion probably key things sending us over 1200 today, and 8 pop on gold and key stats. This is the highest seen since it hit its 50 Day Moving Average level, 1219. 30, tracking for seven consecutive days of gains here. Seeing up rest in the middle east before we see gold move higher. Not necessarily the most convincing trade today. Back to you. Thank you very much. Check of the bond markets now, in the back of the dplus seven year note auction, rick santelli, the professor at the cme. Thank you tyler, and the introday aforementioned seven year yields popped up after the auction, symptomatic, it was a spongy auction, and after all supplies are done, you rally. We want to Pay Attention to this chart, tens reflected the same dynamic, but look they touch 2 , have not closed since the 17th of march, and lets see if it backs away or not. Everyone is looking at the options, and look at the dow, even the dow seems to have moved down at the time of the auction or maybe the following chart. Here it is again, fail above 110, and whats happening now, well when euros go down dollar goes up that could be another reason to see sluggishness in the equities. Tyler, back to you. Rick thank you very much. Saudi arabia begins air strikes in yemen against rebels there amid reports of a ground operation too. Now saudi arabia is right on the border of with yemen. Egypt also apparently becoming involved. Is this region now the new hot spot in the middle east . Is it potentially the start of a wider war in the region . What does that mean for the u. S. . Were all over this shocking developing story involving the germanwings plane that krarked into the alps. Officials say the copilot did it deliberately crashing that jet. How does this happen . Well talk to a former commercial pilot. Wait until you hear what he has to say. [ piano background music begins ] when i was on wall street i felt trapped in that i was investing in a Health Care Industry that i didnt believe in. For years i really struggled with this idea that people were making money off my illness and i wanted to do Something Different and so i finally made that change. [thunder and rain] [thunder and rain] [thunder and rain] heres your cnbc news update for this hour. Egyptian security and military Officials Say saudi arabia and egypt will lead a ground operation in yemen against rebels and their allies this according to the ap after a campaign of air strikes to weaken them. House Speaker John Boehner blasted president obamas Global Leadership as the conflict and instability spread in the middle east. He said he supports air strikes inside yemen, but says obama has no arching strategy to meet the changing threat of global terrorism. Billionaire invester leon cooperman, says the firm was subpoenaed over the trading of certain securities. In the letter obtained by cnbc he said the investigation is in early stages and the firm was fully cooperating. Samsung will take preorders for the new smart phones tomorrow. This monthings the company unveiled the phone, ball lax si s6 available for purchase on april 10th. Thats the cnbc news update this hour. Back to you. All right, court, thank you very much. Stocksed steady following wild swings earlier. You see they settled lower, down 21 points for the industrials. 8. 75 there about for nasdaq and down a point for the s p 500. The dollar is weaker against the euro. Bob is at the New York Stock Exchange bertha following the nasdaq and in london we are following currencies bob . Weve come a long long way from 5 30 this morning. Look at the s p futures. Showing you the overnights down 18 points at 5 20 or 5 30 and since then weve been a slow steadily climb upward. Theres an oversold bounce going on. For example, they are trying to buy semiconductors which had a horrible time in the last couple days but you can pick a bunch, but micron is slowly climbing into positive territory throughout the day, just off the highs. Airlines in similar situations. A tough time on the terrible crash over in germany or in the french alps there, and they are still down still struggling there, transports has trouble coming off the bottom. Finally, the real problem facing the target the last week and a half is the earnings situation. Were not improving. We now have two negative quarters were faced with down 3 in the q1 and s p and almost 2 for q2. This will be a tough one to get out of. Tyler, weve not had a down quarter for several years now. Back to you. Hard to believe it, but its true. Bob, thank you. Lets go to Bertha Coombs at nasdaq. They are trying to form a bottom here now moving into positive territory. Some of the big caps in fact are the ones that are attracting names, celgene is now positive. They are providing lift. Apple today has been bucking the trend. Its been up pretty much since the open and its off its highs now, but thats really what helped to keep the dow and the big caps afloat as much as they have, and interestingly today, some of the little guys and the social media stocks today are all getting quite a bit of love. Gopro upgrade over at baird. Twitter raising a a development finishing up the conference. Have you tried it yet . Someone was petting their dog, watch cat and dog videos live live streaming. Live streaming cat videos just what i need in my home. Bertha, thank you very much. Going to london folks, why not . We are live. Hey, tyler, absolutely. Renewed signs of life in the euro hitting a two week high against the dollar coming up a bit in the last two hours. Whats behind the strength . Well better than expected data out of the euro zone manufacturing at a four year high, and the index measuring Business Activity in germany surprised to be up. At the same time, disappointing data from the u. S. Right . Durable goods number yesterday, plus dovish comments from the fed pushes the dollar lower. Experts say a stronger euro could make the ecb president , mare yo draghis job more challenging. Part of the strategy is a weaker currency boosting exports. Experts say the rally is short lived. Ubs and england say they are betting on the euro to trade in parody with the u. S. Dollar in the next six to 12 months as the ecb exercises its bond buying program, and the fed looks to normalize rates. Those two factors should send the dollar higher and euro lower. Watching tyler, for now, back to you. I got it from here. Thank you, seema. A day of volatility, dow briefly positive before going into the red, s p squeaking its head right now into the green again as we speak. At this point, we could be headed for a fourth straight losing day. Lets bring in scott clemons, managing director, and, joe, principle investment strast gist. What is the best strategy to play volatility because it seems to be here to stay folks . Joe, three days stocks closing at its lows, like the market wants to pull back here. Is that your read on it . You know i think you got a combination of things going on mandy. You got mixed Economic Data of course, here in the u. S. , its been somewhat soft. In a soft patch. You got ill proving Economic Data in europe encouraging. Better credit Growth Numbers from europe, and, of course, you got this you know geopolitical risk as well as strengthening dollar that goes back and forth. Right now, i think most investors and markets around the world are trying to digest all the information. Hence the increase levels of volatility. Joe picking on what you said about us going through an economic soft patch. Yes, the data has been very patchy of late. At what point does bad news become good news because theres implications potentially for pushing back the fed rate hikes . I think we saw a little bit of that last week, of course, after a chairman yellen spoke out and comments were more dovish than most expected. Ultimately, its important to read through the noise, right . Why are we seeing soft Economic Data the u. S. With a harsh winter, especially the east coast, which we know tamp everied Manufacturing Activity there was a strengthening dollar, impact or cap, and its important to remember strengthening dollar, which everyone focuses on and impact on earnings, this is due to diverging Monetary Policy and at some point, stimlative Monetary Policy around the world improves Economic Growth which in turns helps u. S. Companies here. Thats the theory. Scott, lets talk about this volatility. You are long cash. You got quite a bit of cash and youve, you know got it on the sidelines for dry powder. Are you concerned whats going on in the markets . Not particularly data day. We had, i counted this up before i walked up, 18 days so far this year in which the s p moved by more than 1 from open to close. Thats versus nine days in the First Quarter of last year and yet weve gone nowhere. This is three yards up the middle and a cloud of dust or no yards up and a cloud of dust. Theres no shock absorbers in the market. Bob talked Earnings Growth is negative slightly negative valuations are full. Theres not a lot of shock absorbers, leaving cast investors where theres not a lot to be found. Yeah. Certainly feels like the market is trying to have conviction in either direction. Scott, joe, thank you very much for joining us today. Check out more of scott and joes exclusive power plays on powerlunch. Cnbc. Com. Tyler . The copilot of 9525 as you probably know by now deliberately crashed that plane while the pilot tried desperately to get back into the cockpit. A nightmare scenario. Well talk to a former commercial pilot after this. 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. 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. Welcome back. Shares of retailer jcpenney slipping more than 4 today, hovering near weakest levels so far. Theres not an abnormally high amount of Trading Volume in the mid Scale Department company itself, however, bearish option bets on company are outtrading bullish ones by around a 29,000 contract to 1800 contract volume ratio. Thats according to data from think or swim bearish bets could be weighing on the shares so watching jcp, back to you. Thank you very much. As we continue to hear more of the horrific news of the flight disaster we cant help be wonder what fellow pilots feel. Lets bring in our former United Airlines pilot and ceo of Arrow Consulting experts. Phil lebeau joining us as well, and mandy will take part. Welcome, good to have you with us. Whats your Immediate Reaction to this event, and does from what we heard, does it point to protocols that either were not followed or need to be instituted in the case of european airlines. Well first of all, my feeling is horrible like everybody elses. This is perhaps unprecedented, although theres been couple of similar incident in the past but this is this is almost proven now that this was a malicious act. But the protocol, we have a protocol in the u. S. As you know the two member crew members, which we follow im not certain i know im not sure about germanwings, anda misconception that you hear a lot of lufthanassa, and its a low cost carrier of them run by completely different procedures and management. Phil let me invite you in. Well ross im curious, are you suggesting that lufthansa did not have enough oversight of germanwings and that contributed to the incident . Phil the pilots went on strike twice over this issue, and it was not a monetary one. They were worried of Something Like this happening, obviously, not so badly, but for training, maintenance issues things like that. So yes, there is concern over these low Cost Carriers that are sprouting all over the world, and especially in europe sadly, and now they want to come to u. S. Yeah but, ross lets get to the point here. The question is protocol not the cost structure of the airlines here. We just had Norwegian Air come out saying were following whats being done in the United States. Is that the heart of the issue, not whether or not its a low cost carrier . Absolutely, but protocols are made for basically major carriers in. U. S. We follow all of those to the tee, as well as Major Airlines in europe. Im not sure about low Cost Carriers carriers. We do not hire pilots with hundred hours of flight time in u. S. They do. Some of these low Cost Carriers pilots pay for the seat to get in like oryan air of u. K. And perhaps even germanwings. Phil lebeau said earlier on, captain, theres confirmed reports that the copilot had taken a few months off from his Pilot Training due to depression again, unconfirmed, but nonetheless, if thats the case if he had depression in the past is that something that should have ruled him out from becoming a pilot . Absolutely. You know most of us in Major Airlines had to take an extensive psychological testing to get the job. Thats another thing with these low Cost Carriers. I dont think they do that. Plus, if youre in a business for over a year or two, your colleagues, your people you fly with they notice if something is wrong with you. A new kid off the street its impossible to get a profile on him right away. Is there an argument to be made ross that Major Airline captains ought to be of a certain age or greater . Not necessarily. Im not preaching for an age limit, but obviously, theres an faa limit that we cannot hold an atp license until you are 21 years old. But, you know i started when i was 20 flying for the airlines. But i was not put in charge immediately as flying pilot. We used to start as a Flight Engineer for several years, and almost like an aparenapprentice. Thats another thing. With the low Cost Carriers they hire hate to say it again, kids off the street. Uhhuh all right, captain, thank you very much for your points of view. We appreciate you being with us and shedding light on a tragic story. Mandy . Okay. Lets move back to the markets. Let me show you here on the wall behind me if we can bring up the big board and show you whats beginning on. Stocks are positive across the board. You know, weve done this a couple times with the dow and s p already today and moved back into negative territories, we have to see whether or not this holds. The dow, the nasdaq and s p up by one tenth a percent as we speak. But the war between the sunnis and shia intensifies. Egypt and saudi arabia sending in Ground Troops to defend iran iranian forces. What should the u. S. Do . Thats next on power lunch. Your boss . Yourself . Your family . Our Financial Advisors are free to realize a plan to fit your familys unique needs. Well listen. Well talk. Well plan. Baird. 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. [ 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. My name is tony sartorio. Im a lineman for pg e out of the Concord Service center. I have lived here pretty much my whole life. I have been married for twelve years. I have 3 kids. I love living here and i love working in my hometown. At pg e we are always working to upgrade reliability to meet the demands of the customers. Im there to do the safest job possible not only for them, but everybody, myself included that lives in the community. Im very proud to do the work that i do and say that i am a lineman for pg e because its my hometown. Its a rewarding feeling. 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. Egyptian leaders say they will join saudi arabia forces in a Ground Invasion of yemen to beat forces trying to take over the country. The forces would enter by land from saudi arabia and with marine landsings from the red sea. You got the red sea and arabian sea behind me. Saudi arabia and yemen by land and the red sea and arabian sea. They are hitting targets inside of yemen already. Theres the latest pictures from the aftermath of those strikes. The shia rebels captured several major Population Center inside of yemen, the u. S. Backed president is reportedly still in the country but under siege. U. S. Forces have pulled out of the area. Ty . Mandy, lets bring in ambassador ed walker former assistant secretary of state and served in the u. S. Embassy in saudi arabia. Ambassador ambassador, welcome, good to have you with us. We see stakes here reflected in the markets, Petroleum Market most especially but perhaps of greater concern here is as saudi arabia and egypt are ready to put troops into yemen, does this mean potentially that iran will do the same and end in its own troops to back up the rebels that they that are really their proxies . Well, its possible. Its unlikely. I dont think the iranians want to see confrontation with the egyptians, saudis and so on. Thats drawing too hard a line between them. Its much more likely theyll intervene as they have done already by supporting with informal forces and tried to preserve gains made. You know the die is cast. They are entering in slow to enter into conflict but once they enter in i expect they will continue to pursue this until they restore the presidency. Do you see this ambassador as the first major move of the new king and do you think that the prior king, ab la would be doing that what this king is doing . He does not act all together alone. He has a lot of advisers and other members of the family that are considered clearly, a new king is going to have a greater incentive to show his medal, and i doubt he would have had any different choice if it had will be abdullah. Everyone is highly sensitive to the border in the past in saudi arabia and would not be no matter what it was the current leadership that they would take this very seriously as a threat to saudi arabia. Ambassador whats the u. S. Policy on this, and inside the state department does the u. S. Know what a Clear Strategy is on this . Its often difficult. Look, this is like playing three dimensional chess, and if anyone claims they can fully understand that part of the world, id like to see them. No. I think that the state department is taking a clear position here that we have supported the president of yemen whos been expelled from most of the country at to thinthis point, and we do not support the rebels of the proxy force for the yemen for the iranians rather our position is clear on this one. Ambassador, i was at a Rand Corporation presentation a few weeks ago where the individual talking about the middle east said that as worried as israel the west the United States may be about a Nuclear Armed iran the arab states in that part of the world are even more worried about iran and a Nuclear Weapon in their hands or iran rising. Do you agree with that . Absolutely. Theyve been worried about iran rising even without the concept of a Nuclear Weapon in their hands ever since i was ambassador. Uae years ago. This is the basic shadow on the region or the gulf region for the saudis for the uae and so on. They do not like seeing iran encircling them. All right. Ambassador walker thank you very much as always. We appreciate your time and insight. Thank you very much. Lets look at what the market are up to. A bit of a wild day on wall street. The dou down triple digits earlier, to the downside but now up by 34 points and so how is volatility . Do we have a board showing us the biggest winners . Intel is the biggest winner on the dow, up by 1. 5 . Well be back. This is my body of proof. Proof of less joint pain. And clearer skin. This is my body of proof that i can fight Psoriatic Arthritis from the inside out. With humira. Humira works by targeting and helping to block a specific source of inflammation that contributes to both joint and skin symptoms. Its proven to help relieve pain, stop further joint damage and clear skin in many adults. 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Our guest thinks he has a way to stop these kinds of things before they begin. Back to you. Thank you very much. Were looking forward to it. Its been a volatile trading session with a capital v here. Lets bring in our market analyst. Youve seen a lot of markets, a lot of up and down days. Whats your sense of whats happening here and going forward, kenny . You know it feels a little theres a lot of volume today not a lot excitement, but the market is now in positive territory, it does not feel like theres yet a commitment, and my sense is that we probably test lower over the next couple days. Look, coming into the end of the quarter, you got reallocation portfolio, window dressing getting rid of the losers get money back inside that they can plow into the industries that they think are going to do better, and so therefore, i would not be surprised if you see us churning a tight range, maybe between the hundred and the 50 day. Between 2015 and 2065 over the next couple days. In the past month kenny, its been fairly easy to point to casttalysts in the market whether its the fed or rising dollar. In the last few days, catalysts apart from the geopolitical stuff we talked about, yesterdays numbers, relatively far and few between. Whats the next catalyst . The earning season the jobs report . Wait to that in early april . I think its much more going to be about the earnings, right . We already know weve been having the conversation about the impact of the dollar and earnings come down, revision expecting this to be a weak earning season, but until investors really understand the impact of what that means, its going to the market i think, is going to be held tight. Once they see the real effect of the dollar on the different multinationals, if its worse than expected certainly, expect the market to churn and take risks and reprice. If not bad, the market finds stability and moves higher. Yeah you know talking of the dollar, yes, of course the strong dollar has been a dominant theme, and it will be a theme when the First Quarter earnings start trickling out, but nonetheless, theres a reprieve as of late sort of stepping back a little bit. Whats the feeling on the floor . Do you think that goes on for longer here kenny . Listen i think the feds done a great job, right . Leaving ambiguous until they cap the dollar. They do not want a weak dollar but they dont want a strong dollar. Leaving rates, leaving it ambiguous, rates pushed out until august and they have been able to successfully kind of cap it and that should help equities, and it should help the dollar stabilize and not necessarily run out of control. I suspect the dollar trades in a tight range. Kenny, thank you very much. You know, mandy, if kenny were enthusiastic, he would be good on tv right . Pump up the volume. Hes not enthusiastic. Folks, thanks for watching the first hour. A great second hour on the way. Brian . Thank you both very much. It is 2 00 on wall street. 8 00 a. M. In honolulu. The dow made a dramatic come back, when you woke up folks, futures indicated what could have been a massive down day. Wee are climbing back steadily since the market opened up nasdaq as welcoming back and oil above 50 bucks a barrel. Welcome to the second hour of power lunch. All right. Getting much more on stocks, oil, and the macromarkets ahead. We have a continued flow of news on the germanwings tragedy. Fill lebeau here and, fill, the mystery around the copilot grows by the hour. A lot of questions surrounding this gentleman. Andreas, 28 years old, working since 2013. According to the prosecutor this morning, heres what happened in the time ten minutes of the Germanwings Flight when lubitz was alone. The press held a conference on a day when relatives of those victims went to the mountain where this accident happened. The copilot had passed screening according to the germanwings investigation. Lufthansa said no issues reported with him, and they are defending the cockpit protocol which, by the way, under scrutiny. Look whats going on with european airlines, showing you the cockpit and the secure door of an a320, europe allows one pilot to be in the cockpits while the other pilot steps out if they have to use the restroom. Thats far different than the u. S. Protocol. The u. S. Protocol calls for a flight attenadapt to go into the cockpit so you never leave one pilot alone in the cockpit. Theres the key pad thats supposedly would open up a door if you could not get in from the outside. Theres an override switch, brian, in the cockpit, and that was on in the final ten minutes of the flight. Thats why the captain could not get back inside. A lot of questions still, phil. If this is a deliberate act, we have a guest later on in the show who may have an answer to prevent this stuff in the future, phil ill let you get back to the reporting, thank you very much. Back to the markets. Perhaps your top economic story today, oils moved back above 50 bucks a barrel and a big part of the move . Increased tension in the middle east. We got jackie at the ymex for more on the movement, and beginning now with michelle carusocabrera, its heating up in the middle east, and it appears to be getting more confusing. Oh absolutely for sure brian. The Associated Press reporting a short time ago now that egypt will send Ground Troops into yemen to help saudi arabia fight iranian backed my eded my lish shas. They are preparing for landings from sea. On capitol hill hours ago, senators asked the u. S. Central command what will the u. S. Do if iranian backed forces lock the narrow waterways . Given the situation in yemen, if there were action by mill tonights there to block the strait i presume that American Forces were to immediately act to reopen the strait . We would work in conjunction with our gcc partners to ensure that those straits remain open. Its one of our core interests to ensure that we have free flow of commerce through both straits. Last night, the fighting escalating. This is new video of saudi arabias air force attacking targets inside yemen. You can see and hear the explosions in the distance. We learned of these attacks last night from the saudi ambassador who briefed reports from the u. S. On the situation. They have taken over the armed forces of the yemen state. They are in control of ballistic missiles, heavy weapons, as well as military bases and ports. The legitimate president of yemen was able to escape. Despite all the strikes and reported possibility of a Ground Invasion, the iranian back forces holding major Population Centers in yemen continuing to threaten the rule of the yemen president. Back to you. Well michelle, quickly, heres why i referenced cop fusion. Correct me if im wrong. Were trying to mend our relationship slowly, deliberately with iran. These are iranian backed rebels were now supporting saudi arabia in fighting. One hand it appears were reaching an olive branch out to iran and a couple thousand kilometers, whatever it is away we are helping to fight iranian backed rebels . One more to that, were on the same side as the iranians in iraq at this point as well. The whole situation in the middle east is quite confusing and mixed everywhere you go. Wow. Thank you very much for laying that out. Price moving in oil, and back above 50. Whats on everybodys mind the middle east or Something Else . Its the middle east brian. This was the wild card that could take oil prices higher, and it has. Were off the high of 52. 48 but into the close, as you know when the buying usually intensifies, were at 51. 40 right now. What this really is about is you indicated and michelle said is the iranian influence in the region, and protecting those straits through which oil travels. That is the key point here. Also making traders nervous is the fact you have saudi arabia sending Ground Troops in. Those reports are concerning because saudi arabia is the worlds greatest oil producer at this point, and so if they get engulfed in conflict, theres issues there. Remember, we still import a lot of foreign oil, so traders down here care about it. Back to you. Thanks a lot. Ill take it. Lets look at biotech right now. Biotech is a sector we are following. Is there a bubble . Is there not a bubble . Today, theres recovery here and whats worth noting in todays session, look at the ibb, the etf tracking the index at the nasdaq, it is higher today. 50 Day Moving Average is 335 and hit 333 and found support there and bounced higher. Three of the four Largest Holdings in the ibb are actually higher, but for the week, brian, ibb is down 6 . Meantime, the euro today gave back the ground it gained on the dollar in the past two weeks. Sarah eisen has more on this. A big move today. Absolutely. The dollar is keeping investors guessing, melissa, back to the strength of the year. All year everyone said the dollars going higher and higher the parody party, everyone was a member thinking the euro was going down one to one. That stopped last week when fed chairman yellen spoke. The dollar since then is down 3 . Now the decline seems to be coming to a halt again. The question is what is next . Next strategists say theres more room for the dollar to run higher. Barclays said, yes, well see parody, year row down by the Third Quarter of the year, mainly because of europe easy street, lower Interest Rates for a longer time. Double line the massive bond fund confirming to us that they are still bullish on the u. S. Dollar. No question the confidence is shaking here. Usbc, for instance, put out a note saying the rally is over because the different pavts of the fed and ecb are priced into the market and even dollar bulls say now, its not going to go in a Straight Line higher. Whats for sure is its doing a lot of damage in corporate america, pch, they are chipping a 1. 30 after 2015 earnings per share. Guys clearly, theres one certain thing, its going to be a volatile year in currencies, given cues for other markets right now. All right, thank you both very much. We have a market flash now, dom, what are you looking at . Shining bright like a diamond. Those are shares of signet jewelers, the Companies Like kay jewelers, and profits of top expectations despite missing Sales Estimates saying same store sales in the Fourth Quarter increased by 4. 2 and boosted quarterly dividends by 22percent to 22 cents a share, brian. You went to jared, dom. I did. Six straight quarter of Earnings Growth could be in serious jeopardy. Usa today reports 19 Companies Including amazon. Com, that are expected to have a adjusted profits fall 90 or more from the same time last year. Lets bring in our cnbc cricket contributor, and, herb, what do you think of this . Is the First Quarter because of the weather, port strike whatever it was, a complete watch when it comes to earnings . It will be the quarter that anybody and anybody and everybody with operations mostly west of the west will be able to blame the weather for anything and everything. I would argue in these this quarter, you should probably end up forgetting what they blame in the actual text of the earnings but go straight down to the financials statements and see if theres charges. This may be a good time to throw everything in the kitchen sink in there and hope you dont Pay Attention to whats really going on in the business. I think the one company to watch will be chipolte. I say this because last year at this time this quarter, it was chipolte of all the restaurants and retailers was the shining exception to the rule. I think this will be an interesting quarter. By the way, when youre giving numbers, whats going through my head, okay what are we saying . Out of levers . No more buy backs . Adjust it. Adjusted, that used to be herb i love the point. The point you made, and melissa, you get this too on fast money at 5 00 eastern time, you cover earnings shortly after they come out, and i have a feeling that ceos if theres bad news they tell the cfo, dump it into the last quarter. We can blame everything and its mother. I would agree with that. Thats where we look for. Why shouldnt a company take a free pass and run to the bank with it if they can, right, herb . Thats what they are going to do. I think whats more important, though, for companies where you can actually push out the purchases to the next quarter is to listen to the full year guidance and see whether or not the purchases not made in the First Quarter will be done in the second quarter. Thats a great point because, you know the old warren buffet line, when the tide goes out, you see who is swimming naked. This time will show it. And lets be clear, a 90 drop in earnings is almost all the percent. 100 drop in earnings would be a loss. I hate it when companies, like earnings were a loss r 2 billion. If you lose money, you dont have earnings. If you lose money, you dont have earnings. A lot of companies who show profits dont have the earnings they do. It comes back to adjusting out everything that counts. Remember speaking of the tide rolling out and no pants, remember when the camera rolled out and you were not wearing pants . I remember that. Who can forget it . You cant unseen it. Herb greenberg was in pants, they were skin colored. Sure. Talking biotech, the big stocks that are bouncing back today. They are pointing to biotechs leading the market down potentially. If you are in the stocks are going lower camp but dont know how to profit from your believes dont worry. Interesting ways to short the market by actually buying stuff. Sounds weird. Kind of is. Well be back with it. Stick around. Never before has this kind of passion this kind of innovation, engineering, design and performance. Been available. For this kind of price. The 2015 cla from mercedesbenz. See your authorized dealer for exceptional offers through mercedesbenz financial services. Female announcer through sunday at sleep train, get up to 48 months interestfree financing on tempurpedic. Save hundreds on beautyrest. Or choose 300 in free gifts with stearns foster. The triple choice sale ends sunday at sleep train. Volatility index, a fear gauge, is up a little bit, but, goeks folks, its at 15. 7, and anything under 20, its below argument standards. Were not seeing any big jump in fear. Bob is joining us now from the New York Stock Exchange. Bob, it looked like the vix was going to spike, markets tank again. Theres been a dramatic reversal in sentiment in the last couple hours. At 5 20 this morning, they were down 18 points look at the s p now, briefly positive for a while. I think the issue was how much of this was a geopolitical issue. We have a lot of the answer. The answer is not much of it right now. I just want to note the bonds are under pressure in the middle of the moving up. Bonds, close to 2 again, the dollar, as a result of that, has been strengthening. This may be helping the market euro weakening as well as you see here and we are not far from the highs of the day. Back to you. All right, bob, stick rnd,around. Jeff thinks the nasdaq 100 will fall. How far, and jeff why use etfs to bet on the direction . Well melissa, thats a great question. Etfs have been around for quite some time. Those averse to using futures or not or puts or call options, you can utilize an etf like psq, buy the etf, get short exposure to the qqq or nasdaq 100. 2014 was a great year for the tech sector. Now you put this product out there, and you start i want to i want to ask you about these products though jeff. What really jumped out at me is if you look at the psq, theres 182 million in assets. The qid 310 million. These are very very small products. Arent there inherent dangers in these products opposed to options that are a more liquid and deeper market . Im going to push back. Etfs hold the nasdaq qqq or the 100 futures. All the stocks that you talk about, tesla or whatnot, access to shorting the sector via liquid instruments. These are not going anywhere. They are exchanged traded. No smoke and mirrors here. Bob . I have a problem with leveraging etfs. You know that. Not as much problem with inverse, but compounding quality of this does not work if you hold it more than a couple days. A very simple example. Suppose you have 100 in a fund up 10 one day down 10 the next day, after two days heres what happens. Index fund regular fund you got 99, down 1 . If you have a two time Leverage Fund now theres 96, down 4 . Thats not down 2 , but 4 . It gets worse. Every single day that you get any kind of volatility. Thats the problem ive got with this. Im with melissas camp. If you want to short, options is really the better way to do it. The other thing, jeff the question i have about these efts, not to put you on the spot, buddy, if you short a stock, you have an unlimited loss. Could go up forevering right . Do you have the same risk in the short or double short efts . Well if you identify the chain, thats short in the market, its no different than trading the stock itself sully, so, yes, approach it and use what youre comfortable risk. Psq may be appropriate, but if you want horsepower, more short term play in the q, that gives you the ability. Folks dont have access to futures or how to trade options etfs are a viable vehicle from a short term trading per special circumstancetive. Theres a show on friday night called options action. What time is the show . 5 30 p. M. Eastern time on fridays. What time is that in guam . Brian, to your point, its unlimited risk the same way for stocks. Bottom line. Risk is shorted, right . No different. No different than owning stock. Unlimited losses short a sock at ten, made ten bucks a share, 100 profit. If its up a thousand youre in trouble. Basically. Unlimited risk. Anyway good discussion guys. Jeff . Good to see you. Bob, always nice to see you as well. Jeff wrote about the trade against the qs on the website at powerlunch. Cnbc. Com. Look at the dow, huge recovery could be down for the fourth day in a row. Is this just the start of a bigger sell off or buy it . Same question about facebook. All time high hit tuesday above 86 a share, higher right now. Well have the latest from the big facebook developerss conference. Stick with us. Hey mom, you want to live by the lake, right . Yeah. Theres here. Did you just share a listing with me . Look at this one. Its got a great view of the lake. Its really nice mom. Your dad wouldve loved this place. Youre not just looking for a house. Youre looking for a place for your life to happen. Zillow [upbeat music] defiance is in our bones. Defiance never grows old. Citracal maximum. Easily absorbed calcium plus d. Now in a new look. It is day 2 of the facebook developer conference. Now, yesterday, facebook announced embedble videos and new initiatives for the messenger app. Basically, how to be more social while sitting behind a phone or computer screen. That said listen to facebooks Ceo Mark Zuckerberg from yesterday. Think about how useful it would be if you could just message a business and instantly get information about whatever you need make a reservation, buy something in Line Exchange shipping information and times. Today, were introducing a way to communicate with businesses right through messenger. Facebook unveiled a demo for the purchase last year for 2 billion, and attendees were taken inside a space shift to the juryassic period and dropped into a middle of a robot battle. Earlier this month, you raised price target to 92 keeping the rates on it to an overweight. Im curious, how can facebook monetize this . Well thats one of the favorite topics years away, but theres two ways. One way the killer application for this whole Virtual Reality is live events live sports and so they can work with Companies Like nascar realtime eventually nba, nfl. Thats one way to monetize it. Basically, create a platform similar to what they do with message yesterday, and this allows developers to create experiences that you cant normally have i was laughing when you mentioned it its something you couldnt normally do and so thats part of it. The second piece, even the biggest opportunity is called augmented reality, further down the road and thats going to essentially replace computing as we know it and so its a great topic. Its not in current facebook valuation, but, eventually its a driver to the stock. This is a multiyear theme. More immediately, i want to address facebook as a tool for business, and i know a lot of people in the Analyst Community are hyped up about this potential. If im a business, why would i want to go through facebook and skrender er surrender that part or allow facebook to have that relationship between me and the consumer opposed to just owning the relationship by having my own platform in. I actually like the word surrender, and you would do it just because you could get more business because of it. The head of facebook messenger, used to be the former head of paypal talked eventually, theres ways to monetize that. Businesses get it for free. To answer the question, its the same reason why seller wants to get on amazon and give economics up because they are going to get sales they wouldnt have had in the pass. Thats a traction for businesses to really embrace this messenger for business. Im going to confuse you. Its a twoparter . What makes you convinced for the hit, 3d tv a flot. Virtual really could be a hit, but dangerous to put assumptions on it automatically being a hit . Number two, a little more obscure, is facebook too big . We agree its becoming the internet. Is there a point in when the company is big enough to attract the notice of unwanted parties inside the beltway . As far as Virtual Reality, it is different than 3d. If you think about what the applications are, i mentioned the ones on sports you can think about learning and being able to travel to places and for schools. They created a studio billing content, like theater content to be used with occulous. In the case of Virtual Reality and gaming piece too, theres more substance to it. Pay 3 to sit courtside to an nba game . The answer would be yes. Separately, is facebook getting too big to attract other people . If im understanding the question correctly is there any an antitrust issue with facebook at some point down the road . Theres got to be and especially around how much privacy stuff, theres always been issues and concern around privacy, but regulators love to take advantage of a company thats had success, and facebook is going to have and continue to have success. You got to just filter that in and price in as an invester that eventually thats going to happen. Hard to say one, but probably within the next few years. Thats in the model . Assuming theres going to be regulatory action . Well we i think if its i think theres going to be some noise around it. Effective effectively, what happens whatever hits facebook is going to hit the broader internet, and so this is more than just facebook. All right. Great to see you, thank you. By the way, anybody interested melissa in Virtual Reality, theres Richard Powers a book called plowing the dark dual story lines, about Virtual Reality and risks to it. Are you convinced in Virtual Reality . Do we sit court side at fast money ak eastern time . Im not convinced. Im a skeptic by nature. You are, but i am of that. Biotech bounces back the ibb down 6 since the guest on friday high like the valuation risks. Coming up, well ceo plain what happened the last time there was a sell off. Bad news is good news for gold and oil, and with fighting ramping up in the middle east weve got our collective eye on the key leveling for each. Stick around. Can it make a dentist appointment when my teeth are ready . Can it track my crews performance, and protect their heads . Can it tell the Flight Attendant to please not wake me this time . At cognizant, we see opportunities for every company. To meet the new digital demands of their customers. Can it process my Insurance Claim . Like, right now . Can it download a track while im sampling it . Can my keys find me . With the power of digital, analytics and automation now every little thing can provide even greater value. Ok, so can it tell the doctor how long you have to wear this thing . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . 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. Heres your cnbc news update at this hour. The third american on board the germanwings jet deliberate ri crashed into the french alps has been identify as robert oliver. His father robert was interviewed in barcelona where hes lives since 1966. He said they chose not to travel to the crash site because there was nothing to see. Iraq keeping up the air war against isis forces, and iraqi fight jets took off from an air base in baghdad in a push to retake the city. Yesterday, u. S. Began air strikes in tikrit in an iraq around offensive. A volcano still e resulting, and the volcano is located near a popular tourist resort 460 miles south of santiago. Bill gates testifying before a Senate Hearing on diplomacy, development, and national security. Gates warning that investments in Health Infrastructure and surveillance are essential for national security. After fleck said reduction in u. S. Investment is politics at its worse. Thats the cnbc news update this hour. Back to you. All right, thank you very much. Well your key question in the oil close today, will oil hold above 50 bucks a barrel. I know everybody is hot and bothered about this, but we were here a month ago as well. We were. These are big moves seeing not only in wti, but brent as well 2. 64 just under the 60 level. 61. 40 on wti. This is all on the geopolitical unrest. Traders worried about whats happening in yemen involvement with Ground Troops in the country there. Traders are telling me its one of the markets where they just dont want to be short because they dont want to go to sleep at night and worry that something happens, and they wake up in the morning as they did last night with a 3 pop on their hand. Having said that watch the situation closely and see how it develops before we make any judgments about where this is going to take oil. Back to you. All right. Thank you. Melissa . We heard about the recent drop in biotech and whether its a threat to the overall market but this is not the first time weve seen this happen. We are here at the nasdaq with the story. Thats right. I want to read you something. Check out this quote from a research note. He said its a tough month for biotech, and not to make us wonder if theres something in the industry happening in the industry weigh on the sector. That was march 27th 2014 a year ago tomorrow. This has happened before. Were getting all notes from analyst, everyone is talking about deja vu in biotech. Look at the graphs, first three months of 2014 versus 2015 those lines are very very similar. Looking at the red line, 2014 that started earlier, at the end, its very very similar. They saw it before although that started earlier, and now look what biotech did the rest of 2014, bought in compared with the s p, just completely out performed. You see that drop theres profit taking at the end of the good quarter, but, really, out performing the rest of the market. As you said, potentially a buying opportunity here. We saw a previous sell off in february, people were freaking out about that and people freaked out now. That was tied to news around big discounts on hepatitis c drugs. Now were not seeing that catalyst. People are nervous, but as we said, the ibb is positive for the day. Is part of the seasontyality because weir in between conferences . We dont have one until the spring. Lack of catalysts could be playing into this. Well get into conference season. We got acr, cancer conferences, that will pick things up. We saw excitement over recent events like the alzheimers data friday, we talked a lot about it and other therapy companies, juno last night, people are saying are we too excited . This could be a backing off. Good perspective. Thank you. Brian . Thank you very much. Time for trading nation lets talk bonds, a currency strategist with bk asset management, and andrew why arent bonds getting stra ingting that strong a bid . Its not what i consider a risk off day. You know i dont think its really traditional run to defensive safe havens. Look at bond proxy sectors like utilities, they have not done well, and certainly not all year. That gets back to the idea you know, that the fed is going to be moving short rates higher later this year, and thats not good news for bonds or bond proxy sectors, so specific catalysts today could have been the jobless claims data from this morning. Yet another piece of evidence of the labor market improving here. Just gives the fed more confidence, you know they can continue on the path to you know, normalization. If im hearing you right, andrew, your trade would be the bond prices will fall, ye yields rise . Thats true. All right, kathy, we hit 2 on the ten year today. Do you see bonds moving decidedly higher than this in the months ahead . I think eventually bond yields break comfortably above 2 . Adding to andrews point, the other reason we are not seeing a demand for bonds is auctions seen this week have been lackluster. Theres not been this demand that, you know, everyone is looking for in terms of safety. On top of that i think if you look at the recent data on foreign purchases of u. S. Trash ris, theres been reduction in demand for u. S. Trash ris, which is interesting considering that we basically, you know dont have much in fact way of alternatives. I think Central Banks diversify the games, and they reserve allocations. That could lead to a longer term downward pressure on u. S. Trash ri prices. Talking about the trade that andrew pointed out, we see that we can have the impact of the fed tight pening driving prices lower and impact of treasury forces as well. Look at currency market. You are seeing the dollar has very inconsistent performance right now. Dollaryen is down dollar up against the year row. This inuncertainty weighs on the vehicleolatileity in bonds as well. Good discussion about bonds. We appreciate it guys thank you very much. For more trading nation go to our website, but not now, tradingnation. Cnbc. Com. Five stocks, five calls, opportunity for you. 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Even though it is actually relatively soft medal, look at gold, up today, and crossing what some call a psychologically important level of 1200. By the way, this is the 7th straight day of gains for gold, up 460 an oups. Time for street talk Analysts Recommendations on stocks to know about. If you dont think you need to know, were going to tell you. National railway, up to 81. They like the fact Canadian National railway has less exposure to coal business and same downgraded pacific. Interesting you mentioned coal. Upgrade with a rail downgrade, Norfolk Southern downgraded to a market perform, and you mentioned less exposure. Well, this one has more exposure for coal shipment with concern theres lower coal shipments as part of the call we have to know they trimmed estimates for csx Union Pacific in and wyoming. Down 5 this year theres one only one railroad stock up this year. Do you know what it is . Genese in wyoming. It is. Cant get anything by you. Trucking company, conway, upping to a buy from a hold. They say the run in freight volume growth has more legs to it buy on a sell off, target is 53 to 8. 75 above. Part of the call, brian, increased regulatory action could reduce trucking capacity by 5 in the next couple years, and so in the back half of 2017 there could be the mother of all truckload capacity shortages. So thats their words. Thats part of the call. Interesting one here especially as we are talking about the transports a lot. Next up here twitter, evercore is optimistic about monthly users lifting the forecast on the new Google Search deal. Twitting content available to google users, yielding 700 million in audiences for twitter, meaning 17 increase in traffic and 9 increase in maumaus. Beginning coverage of twitter with a buy today. Final stock, under the radar smaller cap name today is rice Energy Ticker rice. Capital one securities upped underweight to equal weight. Cash flow positive by mid2017. Target is 28 30 of upside. This is interesting. It was one of the Biggest Energy ipos of 2014 and, actually raised 1. 1 billion at the beginning of the year, i dont know if you call it good timing to get the issue out the door or bad timing. Its probably the zeppelin song, right . A little of both. Absolutely, absolutely. Lets turn to financials here, poorest performing sector this year, etf down 4 year to date. Whats the best strategy to play . Lets bring in the manager of four star morning star fund dave good to see you. Good afternoon. Do we need to see rising rates, and therefore, better net interest margins to be positive on financials . Well first of all, i dont think were going to have much of a rise in rates for a while. Right. I think a rise in rates is measured in you know 10 15 25 basis points, so its not going to mean that much. I think the game here is the economys getting better. The companies are generally getting better. Credits getting better, and the issue now is loan demand. If that picks up, earnings improve, and that drives stocks. Right now, people do not care because theres people fearful of a rise in rates, fearful of the end of the world, and this space has been, you know a very difficult space to get excited about for a number of years. Are we seeing that pick up . Are we seeing that pick up in loan demand . Are you concerned about the impact the Energy Sector has in terms of sapping loan financials to those exposed to the Energy Sector in. Well, certainly, youve seen that in the smaller names in texas, some of the smaller names up in pennsylvania and up into north dakota, but those are small banks that are not going to really make that much difference. Theres a enough hedging going on with the companies, and theres enough equity there, and enough certainly enough new equity it comes in to bail companies out or reinvest in the space. Im not that concerned about it. I think what i look at is if people are getting jobs they are generally going to borrow money, and if they have a job and borrow money, its a good loan to make. Thats what the banks live on. Which Large Cap Bank dave, fairs a not rising rate environment, flat rate and increasing loan demand. Which has the most leverage . Well thats you know ive got, you know 30 names in the portfolio in the large cap portfolio portfolio, and the goal is to give you a measured, you know mix of the names out there, and so i think a lot of the analysts are trying to figure that out, and i dont think they really know and nobodys going to know really what that is but at the end of the day, im looking at the deposit franchises, what the companies are doing to get better, and im not trying to sort of predict whats going to happen with rates. Rates go up if the economy gets better. Thats good for the industry. The worst thing is to have rates go up and have the economy weaken. That would be bad for everybody. Obviously, but i think at the end of the day, a strong banking system, which is what we have now versus the rest of the world, is what we had eight or nine years ago is good for the economy. Its good for the lending structure we have. Its good for the market. Thats why the market has done well in the last four or five years. Dave, leaving it there, thank you for the time. Youre welcome. All right, up next a long time Aviation Industry insider has inside on how to help prevent any future situations like apparently the germanwings tragedy is turning into it. Stick around. At mfs, we believe in the power of active management. Every day, our teams collaborate around the world to actively uncover, discuss and debate investment opportunities. Which leads to better decisions for our clients. Its a uniquely collaborative approach you wont find anywhere else. Put our global active management expertise to work for you. Mfs. There is no expertise without collaboration. The road. It can bring out the worst in people. But the mclass scans for danger. Corrects for lane drifting. And if necessary, it will even brake all by itself. It is a luxury suv engineered to get you there and back safely. For tomorrow is another fight. The 2015 mclass. See your authorized dealer for exceptional offers through mercedesbenz financial services. 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 is increasingly looking like the copilot of the Germanwings Flight deliberately crashed the plane while the primary pilot was locked out of the cockpit. If true it will raise an entirely new set of questions in air travel. Blue light advisers founder and agency insider, and longtime licensed pilot. David, thank you very much for joining us. You and i spoke earlier today. You said perhaps it is time to put remote control, perhaps Drone Technology in commercial cob pits. Do you think that is a a viable solution, and do you think the airlines or pilots would go for that . Good afternoon, brian and melissa. Thank you for having me. I think, brian, the technology is clearly here to accomplish what you just described. Today were flying drones over afghanistan, iraq and the southern u. S. Border. And those drones are being flown by pilots and flight crews in north dakota and nevada. So the technology is there to control an airplane remotely. We have proven it. We do it every day. They are delivering supplies to forward air bases by helicopter. Youre a pilot, dave. Pilots are proud people. They have gone flew thousands of hours in training. I would imagine if im a pilot or Airline Union and someone says hey, we are going to put this Drone Technology in your cockpit just in case there will be significant pushback. I think clearly there is the potential for pushback. First off, professional pilots are professionals. And they take the responsibility of getting their passengers safely to a destination very seriously. I cant imagine what was going through the mind of that captain as he desperately tried to get into that flight deck. He had lost control of his airplane. Thats something no one wants. There will be fear of big brother. There will be fear that big brother takes control of the airplane at the wrong time. With certain safeguards and protocols that could be avoided. There may be push back from unions from the standpoint that this is the fitter step to introducing pilotless aircraft into the world. My sense is you and i and melissa will never see that but maybe your son, brian, might. Its interesting too, david, the copilot and why he took a leave of absence as well. What kind of testing youre an Airline Recruiter at the top level. What kind of testings do airlines do currently and what should they be doing given these men and women are in charge of 300, 400 lives at a time. Absolutely. An airline project, as i mentioned earlier, first off is a professional. They submit themselves to a physical exam every six months. Imagine having to go through a physical examination to keep your job or my job every six months. They bet their career on passing that physical. Im not sure perhaps it contains as deep a psychological dive as we would all like. But psych lodge come assessment and monitoring is part of airliness practices. In this case it looks like an individual may have broken through the net. David, appreciate your time today, buddy. Thank you very much. Thank you, brian. Big turnaround for stocks today. The dow getting into positive territory at one point. You can call me shallow. But, i have a wandering eye. I mean, come on. National gives me the control to choose any car in the aisle i want. I could choose you. Or i could choose her if i like her more. And i do. Oh, the silent treatment. Real mature. So you wanna get out of here . Go national. Go like a pro. Just because im away from my desk doesnt mean im not working. Comcast business understands that. Their wifi isnt just fast near the router. Its fast in the break room. Fast in the conference room. Fast in toms office. Fast in other toms office. Fast in the foyer [pronounced foyyer] or is it foyer [pronounced foyyay] . Fast in the hallway. I feel like ive been here before. Switch now and get the fastest wifi everywhere. Comcast business. Built for business. In my world, wall isnt a street. Return on investment isnt the only return im looking forward to. For some every dollar is earned with sweat, sacrifice, courage. Which is why usaa is honored to help our members with everything from investing for retirement to saving for college. Our commitment to current and former military members and their families is without equal. Start investing with as little as fifty dollars. Its been a crazy week for stocks. Most of you probably are not trading day to day or week to week. Lets focus on the longer time. Wells fargo adviser and equity management. Director of the markets the next couple of weeks, what sectors, in your view, will be thes tells . What we want our clients doing is stepping in on these pull back days pull back weeks. We want them buying Technology Consumer discretionary and better performance a abroad. Are there sectors you would say, im not going to touch it at this point. Is biotech too hot to touch even on a pull back . Really biotech is a trading group. No doubt about it. In my personal opinion it is overvalued, stretched. And we would not want our clients putting a lot of their eggs in that one particular basket. All right. Steve, i want to go to you here. Talk about a sector with a lot of volatility. You say stay away from understand. You like a player in the tanker area. Well we think it is too early to invest in energy. We think there is a a lot of commodity pricing risk still here. We think oil would break 40 a barrel. The storage of oil in america has almost completely filled up. And that can create commodity problems downstream. We like the oil or industry area with longterm contracts in place. Were getting a free call on energy. The cash flows are locked in the next three to four years. They still traded down. Many stocks have 9, 10 11 yields. So we kind of think its a neat glitch in the market right now. Midstream partners is the one. Map is the ticker on that. And you like commercial real estate lenders, steve . Well we like when theyre trading at a big discount. Arbor and commercial real estate 80 of tangible book yielding 9 . They have legacy paper. But we think commercial real estate is really flowing downstream with Interest Rates so low. Right. We think the assets will be fine. Guys, great discussion. Thank you, scott and steve. I know brian, youre tuning in to fast money because you always do. Tonight is the first round. This is going to be a big one. A big one, brian. Apple versus hewlettpackard. Whoever goes will cisco in the next round. And of course we want to see who is going to make it to number one. That is tonight at 5 00. Facebook will go all the way. Number three, West Virginia will beat kentucky tonight in actual basketball. No offense to your predictions. I do mostly listen on sirius xm 112 on the way home. I know you do. The ipo of the day, up 20 . That you know very much. Closing bell starts right now. Welcome to the closing bell on a thursday everybody. Im kelly evans at the New York Stock Exchange. And ill bill griffeth. A lot going on. So many moving parts and pieces. Also major developments you may have heard in the crash of the Germanwings Flight 9525. It is now apparent that the copilot that we are showing you here as seen in a photo verified by a local german newspaper apparently intentionally took the plane down along with so many of those innocent souls on
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