Gaze portfolios were slammed but perhaps good news, bonds rose. Maybe the bond market may be suggesting worst of the selling may be over . Well find out meantime the banks despite the yields, battered, even as top ceos wrap their meeting with President Trump at white house, well get more on that in minutes. Perhaps the biggest shock is boeing shares down another 18 today. Boeing, really one of the bluest of the blue chips, now has lost half its value in just six months time. Well dive into why. Joining us to walk through all of this, karen, dan, tim and guy. Welcome everybody. Another big night, difficult night for a lot of people out there. Pension funds, state pension funds, companies guy the question to you and everybody on the panel and lot of viewers what may not be market pros, tuning into cnbc first time, do you sell now if you own stocks, ride it out . See any sign of a stock market bottom maybe the bond yields when let us down in s p, maybe rising a little bit will lead the s p 500 up now is not the time to do a lot of anything. Now try to understand whats been going on in the world last six months, get up to speed as to the reasons why a lot of people, correctly, maybe not correctly will say obviously guy this is all coronavirus. I would say thats not the case. Coronavirus was the match that lit the tinder box this has been sitting on last year or so try to understand the reasons why. To trade the market here, even the oldest pros were having difficulties traders have been trading to varying degrees of success but try to understand why, see where the companies you own are and understand if their business is going away, probably arent, or just another 20 downturn over the years weve seen three or four times last decade or so. Couple of things worth noting in the market. Mildly complicated dont want to make it too complicated. If youre concerned about exposure what doesnt work is index shorts at this stage after extreme selloff, index shorts stop working and you need to find single stock shorts to match your volatility with the long side of your book something to throw out there when you think about what the market has done, today we closed below the lows of two days ago this is a case where markets are trying to find that level. No question the velocity of the move makes this extraordinary. I go back to reminds me of 2011 analog, first seven, eight days of august, went down about 9 , chopped around, then down 4 , up 4 , went on until the markets started to see but still had a growth scare after oversold markets rallied hard, confronted with macro setting that wasnt so good. Its not just the velocity but the aggregation of all of the moves. When you look at talked about rates. Tenyear treasury yield just under 2 start of the year and down to 31 bips on monday, that was a crash, probably most shocking thing thats happened this year in risk assets globally then what happened with crude, crescendoing yesterday, still going lower. Dollar move was significant. That was a crash of financial markets. Theres no way to sugar coat that but getting back to single name, theres going to be amazing opportunities. Guy mentioned you have to focus on the companies that will be around will be Companies Just not investable cruise lines one of them dont think so, not yet, not ever going to take years talking about over stored in retail, department stores, macys becoming a distressed Balance Sheet, why would you buy that could be the final thing focus on things like disney, will be around, down 30 and leg into Something Like that parts back online, movies back in stores and consumer is back i agree with what everyone has been saying. When i try to figure out what do i own, Balance Sheet first debt situation, how long can we ride it out . Google, bought some friday, obviously that was too early Balance Sheet is probably premier in the world right now same for facebook. Then targeting the retail space. They have debt but this is not a concerning amount at all thats important to me disney has some debt i do love the name am waiting for big down disney day but this is not does anybody around the table believe that what has happened the last couple of weeks with equities is an overreaction . If you look at bond market, its not credit markets last three weeks, last ten days, its not. If you look at where valuations were before the selloff, its not. Prospect for earnings, not how overbought we were as function of central bank googs Monetary Policy its hard to say. Doi dont want to be perversely negative starbucks was done, getting to numbers of people not going out, getting morning cup of coffee, going to work. Where do you get your first on the way to work, grab your starbucks, thats a Great Company i want to own, one of those names, didnt think would see at these levels. Its a reaction, i dont think overreaction weve said this a long time on this show, plays out over and over again markets go down faster than go up and now even faster than historically, thats the way the markets built feels bad but if it happened over threemonth period, would we have the same conversations, no what level makes sense, i dont think we get there, but 2410 level we saw in december, thats the level we have bulls eye on. And the russell, now its below that 128 level we talked about forever. Thats something you need to continue to wax. If the russell were to turn with the bond market, maybe assuage concerns. Hear what youre saying and believer in technicals thats for pros and semipros wonder if mom and pop gives up on equities like in 2008 cash out done, cant stand the pain they wont care about the technical, i dont know. Except late 2018 destruction, 20 in two months or so. If youre looking to put cash to work and in no mans land right here, okay maybe we have a crescendo towards the low at 2350 where the market stopped going down and launched epic oneyear or 18month rally or so one more point to question whether its overreaction. S p is back to january 1st, 2018, year that the tax cut went into effect. Money borrowed from the future and handed to corporates next two years they bought their stock back, 1. 5 trillion worth of stock seeing unwinds here in a way not too different with rates everybody wanted low rates and commodities. Then wasnt good for risk assets across the board back to boeing. Highlighted that top of the program and nobody is trying to dump on boeing, but karen you mentioned something important about Balance Sheets heres the thing about boeing. All this news about the max, order cancellations, we understand that. Pension obligations that when you do actuarial tables, gains and Interest Rates, they destroy them companies with real obligations. Boeing fell 18 today in depth of the financial crisis had negative book value 1. 2 billion. Stay its negative book value of 8. 6 billion i mean Balance Sheets matter. They do we heard about boeing drawing their revolver down. Smart to do. Ge, all the companies have the same issue ges pension obligations on paper just got higher as Interest Rates went down all the top, huge fixed, defined by the way, there are companies with pensions still, all positive book value. Say something about the bottom boeing or something more to worry about . I dont own boeing. I think, even having come in this much, whats happened to the airline, whats happening in economies around the world, theres more downside for boeing at some point it is cheap but everything is getting cheap. Boeing is cheap relative to where its been last year and a half but everything is getting cheap. Throw a comment in here peak earnings 16 a share and went down dramatically last year but next year right now expected to maybe this is consensus, and it could be lower to your point we dont know. No visibility. But company that people would say tim you would have said it a year ago, take it to the bank right if company like boeing can get back to peak earnings in out year, you can start valuing. Say its trading 11 times that this is when i start dipping my toe in the water thats how you buy a company like this that just seems the perfect storm. Above 300, down 50 in short time boeing is going to be around and orders will come back one way or another. Thats how you have to think about it youre going to have to take risks. Thats what the whole game is. Sorry go ahead. Boeing is where we went into the downdraft and reality they went from Free Cash Flow machine to quickly levered up. I have to check the number, its around there they have to issue and will be issuing massive debt this year when they start generating Free Cash Flow, priority is going to be debt paydown. But gearing has changed almost overnight. Company that was extremely cash flow positive. 25 a share, to one thats changing to close to 2 1 2 times. Something the market doesnt like. And bought back stocks, changed book values. But number getting attention on boeing nobodys picking on the stock but given it is still the highest value dollar stock in the dow, it does have outsized impact on and i know the dow is not what we should be looking at as pros but it is what is making the headlines and now its dominating the general news 6 30 news is leading with the stock market and dow is what the american looks at. I totally get it. And quickly, this is important s p 500, Dow Jones Industrial average is probably down from recent alltime high 19. 5 or 22 , thereabouts people watching, 20 cheaper market dow jones you mentioned, it is doesnt mean that stocks are cheaper. Theyre valued price to earnings and nobody out, and i cant, tell you what earnings are going to be. I can make an argument, said it a few times that stocks today might be more expensive than 2 1 2 or 3 weeks ago you have to get your head around that whats happening is market is recalibrating at extraordinarily fast pace. But i know as painful as that is, its not necessarily a bad thing. At some point there will be buys and youll find companies that fell more than they should have and generational wealth lob recreated because wished they bought then. We dont know that time. Bring in head of u. S. Equity and quantitative strategy at bank of america. Good to see you on another difficult day for majority of investors and your clients now the time at all to buy any stocks out there yeah, from a stock perspective there are a lot of Good Companies with maintainable yields discarded with the bath water. One of the things we saw with the selloff, been one of the most uniform weve seen since the financial crisis stocks have been less differentiated in downturn than in prior downturns feels like derisking institutional and individual investors shedding exposure to all stocks those environments generally lead you with great environment for stock picking. I dont know if today is day all stocks bottom, probably not, probably gets worse before it gets better but being selective, looking for stocks what i thought was interesting in our client flows, we found that are buying stocks, we saw that last week keep in mind this is an environment where passive etf investing might not be most prudent way to invest. Historically after big selloffs tend to see investors reduce etf exposure but buy single stocks might be in that today couple of things. Number one, is that because lets bring up xop i know youre not individual oil stock person. Thats fine. Only mentioning it because etf is trading at 9 like if oil was 5 a barrel because clearly some of the members of the etf as equities will not exist in a few years. Thats how investors are starting to think, dont buy etf because some of the things in the etf, whichever one it is absolutely, are going to go away, literally going away is it exacerbating the market moves . Absolutely think that just last few weeks, this has been the most uniform selloff weve seen in the history of our data a selloff driven by summarily discarding risk assets think about energy whats interesting there is that weve got an environment where energy we are under way, this is a sector where a lot of companies are about to or have recently cut their dividends what happens then, doesnt just bottom and come back up but companies that cut their dive decade tend to underperform, dont find bottom until on average ten months after that cut. Areas of the market feel perilous, unless we see covid containment. Doesnt seem like will happen for another quarter or two canaries in the coal mine like hotels and early cycle stocks are still telling us things are getting worse rather than better name of thegame right now is b very selective my recipe for what you want to buy or own in the market, companies that pay a dividend because income is the scarce resource had treasury yields test alltime lows. But they have to be sacrosanct way to figure it out, low payout ratios companies not paying out all earnings or dividends, energy right now. Look for companies with stability of earnings. Staples Company Rather than retailer and companies that dont have demands on cash flow from shortterm debt becoming due thats where the bbb minus rated companies, with lot of shortterm debt that needs to be financed, potentially higher spreads, be mindful of avoiding. I think this is a particular stock pickers market. Liquidity but safe yield matter. Two names that fit a lot of that criteria are apple and microsoft. Two of the largest micro Cap Companies in the u. S still up significantly year after year apple up about 50 from march of 2019 and microsoft about 35 look at those two name and relative performance, you said before, dont know about the bottom, probably see lower lows, is there risk to those names both pulled Earnings Guidance and likely to see downgrade to that are they too expensive i would stay away from tech for the time being because of the supply Chain Disruption and global nature. I see opportunities in domestic area sector thats done poorly is financials its a domestic sector but payout ratio is incredibly low relative trading at low multiple because people think yield curve will never widen again. This is a sector, dividend yield is higher than s p 500 if you look at active managers out there, 50 of institutional money managed in the u. S. Is in an income fund 50 of Institutional Investors are looking for safe yield i actual little think that financials might be the best buy in this downdraft weve seen of all the sectors. Wow these are companies that have reduced leverage ratio to a sixth where they were before the crisis not saying go to grow like gangbusters next cycle but in environment looking for quality yield, low leverage, safety this is almost a regulated utility sector but trading at half the multiple of regulated utilities, and by the way maybe buy regulated utilities as well, at least there you know what youre getting and valuation looks attractive relative to other fixed income options until we see signs sorry. But to say here, until we see signs of stabilization in the credit market, key market i watch for sense of its time to think about bottom fishing or putting a bottom in the markets, until we see signs of stabilization is there, my mantra is safe yield. We could do an hour with this saf eatta, we appreciate it. Thank you. Maybe look at that and karen says come back to the credit markets i was looking at closed in funds. Dsl, dhy that reflect the credit markets. Those we should be watching right now. Yeah. I dont even think weve seen the bulk of the pain were going to see yet hyg, asked does it trade below nad. I think it did today right on the edge of low net asset value. Investors are selling even though theoretically the holdings are worth more than the price selling. Lqd was slapped. Investment graed indgrade indexa hurt worse any Investment Grade etf must sell if not Investment Grade and wonky if youve not been in the market for 12 years, may be new to you. Nothing but upgrades for a decade what youre saying is Investment Grade gets whacked down to junk. Junk into more junk and firms that have written abilities to own certain things and not, they have to dump the worse things. Market context, if credit is continuing to deteriorate or dont have read where it will bottom, major issue for equities financials are great i agree with savita. If you look at financials etf, not a perfect proxy because some insurance and berkshire in there, but it tracks the sector. And if you think about it, its at december 24, 2018, low, gone down it 30 in 15 days and back to where it was after the election in 2016 when banks had the target taken off their bank. Thats part of the reason you want financials with this administration continuing coverage, selloff, where weve been, where we may be going. Special report markets in turmoil, 7 00 p. M. Eastern time tonight. More fallout from the coronavirus. L. A. , what is being canceled now. Late night shows are canceling live, instudio audiences. Going to start this weekend or monday depending when they air just got the announcements at the same time in conjunction on guidance from new york city officials. Press releases from tonight show, stephen colbert, and last week tonight with john oliver saying no reason for concern in studios or reports of covid19 among the staff but taken as precaution. If youre just joining us here on cnbc, another major selloff, dow falling nearly 1,500 points dow down more than 20 from recent high. Bank stocks as we mentioned are part of that despite the fact that nations top bankers and ceos all met with President Trump at the white house today. And thats where we find will fred frost with more on what they talked about today. Reporter rare gathering at white house with leaders of the biggest banks and private equity companies. Had 2008 financial crisis feel about it, though the comments that came from the bank ceos was decide decidedly different in tone. Were strong and capitalized. Great position in liquidity, capital and strength this is not a financial crisis, were in sound shape and here to help echo whats been said, Banking System in good shape, virus poses unique challenges for policy makers and businesses large and small across the country. All businesses are focused on taking care of their people. As part of the Banking System looking to help Small Busines