At roughly 2 00 p. M. The president is expected to take the podium and unveil a policy action or slate of actions that is expected to significantly escalate tensions with china in the wake of the coronavirus and just months after that much harolding phase one deal was struck in january. You can see the reporters there to answer questions. This has been an announcement thats been telegraphed slowly throughout the week. Theres been an significant ramp up on behalf of the administration in the last week after china sought to impose a National Security law in hong kong that would crackdown on public demonstrations there. Since then, the secretary of state has told congress that hong kong is no longer autonomous the secretary of state certifying that is the case and that could result in some policy actions that could lead to the revocation of the special economic status in hong kong that allows that territory to be free of tariffs. That is one of the policy recommendations that was on a menu presented to the president earlier this week. Other actions were a possible revocation of visas for chinese officials and Chinese Students and researchers that are found to have ties to Peoples Liberation army there. Thank you while we awats President Trump, lets get more on the market sell off with dom. Were making a move toward the lows of the session so far with regard to the dow and the s p 500. How much people are saving in america versus spending. That picture is weighing on some of these Retail Stocks you can see this particular etf stock, the spider retail etf is sitting right at its longer term average price for 200day moving average. Well watch that Retail Sector take a look at somesto stocks on the move lululemon gets an upgrade. Tyson foods is lower after its shutting down one of its pork processing plants in iowa due to a coronavirus outbreak there kelly, back over to you. Down about 6 its good to have you here what is the markets expectation, you think about what we might hear this hour it seems its relatively new if there were serious concerns we would either say revoke the phase one trade accord that was signed with china in december of last year or if there were sanctions that would effectively cripple Cross Country trade. I think the market would be selling off a little bit more. If it was going to be a set of sanctions that we would still be surprised on the down side. What about the banks in particular here. This keeps coming up as a concept that those with exposure could see sanctions or something of that sort what might that look like . Listen, i think sanctions on the bank, if i was to create a list of sanctions from things that are extremely mild and i would put sanctions on individuals whether its freezing someones saassets or preventing them from travel or kids cant go do harvard, i would have that on one end normalizing taiwan, selling new weapons to taiwan or cancelling that if thats on the other end, sanctions on banking are on the more serious end the president wants to thread a needle here. He wants show hes serious because joe biden will try to be serious and outhawk him but at the same time he doesnt have to rattle the markets any time you start getting in banking and financial institutions, i think thats more on the series side of actions taken by the president ron, anything you add to that given the fragility of the economic rebound in the United States and it may be going better than expected, i think the timing is considered i think we need to be in a slightly stronger position to deal more forthrightly with china not that i approve this the strategic importance of this need to be a knee jerk response. Nie need to be well thought out to great more global pressure and become a good actor rather than a bad actor. Also comply with International Trade law on a more serious basis than it has in the past. To rons point, is it possibility of any action backfiring limited because were going into Election Year and we dont want to or President Trump doesnt want to inflict the same damage inflicted during the negotiations for phase one yeah. I think thats really the tricky part the president wants to be taken seriously. He doesnt want to rattle the markets but he has the other guy out there, joe biden, who has already made it clear and his staff made clear they intend to be tough on china. I think the president has talked a good game but hasnt followed through. Biden is going to be tough and again, the president does not want to be out hawked by joe biden. I can can see this as a year of escalatining tensions youre saying the markets are looking past this. Should the markets be more concerned about the potential down side coming from this i would be. I dont know if part of it is my mood everything going on in the last 24 to 48 hours strikes me as significant and disturbing whether its in minnesota, whether its in washington, whether its in beijing. I just feel general unease at the moment i would suggest the market might be more concerned about this it will only take one misplaced comment to heighten the tensions but the real possibility of limited trade relations of the u. S. And china. Jerome powell warning about a slow economic recovery in a virtual event. Steve joins us with all the details. Thanks. The main Street Lending facility is a 600 billion fund that will lend to mid size bases it will help to companies in that 500 to 15,000 employee range. He also said the fed has Additional Fire power to help the economic recovery. Hes worried about a second wave were not close to any limits. It might make for longer recovery and weaker recovery dom told you about the efkts of Retail Stocks on spending numbers. Let me show you what the numbers were every one of the numbers you got to see is historic 11 increase in income talk about that in a second. How did income get so big. A 2. 9 increase in government benefits most of it that 1200 check. When it comes to the true picture of the consumer, should we be focused on the wages and the possibility that perhaps pay cuts and those sorts of salary reduction measures havent hit the numbers yet. Im focused on the savings rate when i think about the long term you want to see wages and sal y salaries come back you want to see americans put back to work once they are back to work, what is their proclivity for spending you can see an initial surge on spending because of pent up demand do we get to a place because of this recent bout of unemployment, they feel like they need to have bigger rainy day funds. You have an economy thats starting to recover and has these head winds and now we have the flare up with china. I dont think trump would pick now as the time to punish them about what they are doing about hong kong. Now isnt a great time but maybe thats the point if i were the chinese, maybe thats the point i think when the phase one trade deal was announced, i think it was by far the consensus opinion on wall street thats it. Were done maybe they might talk. Certainly no expectation of any more market rally sanctions or new tariffs. Thats all been blown wide open. Other republicans who have turned hostile and it looks like trump is the biggest dove in the Republican Party thats where we are. Thats why i think a bet on increasing tensions even if its only a headline risk thing is not a bad one. Hes trying to thread the needle here. If we can pick up on that, cant everybody if theres a sense of announcements meant to show big import but not do upset markets too much larry kudllow said im not worried aworr ed about the tstock market something has to be done here. The president might feel differently and maybe that we have to consider his niensment in light of that i think so. We dontknow what we dont know theres a lot of that going around these days and its true with the president s announcements on any given day the market has rallied so much, does the president want to create an impediment for himself going forward. Joe biden may be more hawkish on china for the moment the real risk is again, anything that puts the brakes on recovery in the u. S. Economy or causes the type of cross border trade disruptions that could really throw a wrench into a Global Recovery is problematic. The timing is always the question were going to take a quick break. We got the two minute warning about ten minutes ago. Thats the status as we await to hear from the president. Well keep you around. We hope to come right back and catch his announcement as we await this discussion, energy is one of the worst performing sectors but oil is on track for its best month ever. Well tell you how traders are playing that comeback. Also talk about the housing rebound. Its been a bright spot despite the bpandemic home builder stocks had been on fire a whole lot more power lunch is still ahead. For business as usual. Or is it . What if business as usual means putting people first. And understanding their needs . If thats your business. 365 days of every year, then business as usual is precisely what these times require. Which is why your lexus dealer will do what weve always done. Put you first. Find out how we can service your individual needs at lexus. Com peoplefirst. Find out how we can service your individual needs there are times when our need to connect really matters. To keep customers and employees in the know. To keep business moving. Comcast business is prepared for times like these. Powered by the nations largest gigspeed network. To help give you the speed, reliability, and security you need. Tools to manage your business from any device, anywhere. And a team of experts here for you 24 7. Weve always believed in the power of working together. Thats why, when every connection counts. You can count on us. Welcome back to power lunch. Were awaiting the president s News Conference where hes expected to discuss china. S p 500 is down. The Housing Market has been major bright spot as the recovery has been fast and fur ro furious. The Home Builders are reaping the benefits this came as a real surprise to most in the industry and the builders themselves. New home sales out performed expectations by a lot. Still down from a year ago but only by 6 then luxury builder Toll Brothers this week reported at Second Quarter as super strong to start then a sharp drop off mid quarter as the virus struck. Ceo doug yearly said web traffic has also steadily improved from the lows we experienced in midmarch and returned to the same strong activity we enjoyed p precovid19 you can see the builders stocks and the Home Construction etf have recovered its not the big builder they said sales have doubled from april lows and web traffic is increasing and back to the busy levels they saw in february the builders have ben fiefitting from this sharp drop in supply of existing home sales they are also dropping prices. 22 of builders said they dropped prices on average of 5 . Back to you. Thank you very much check out the home builder on pace for its best quarter ever up more than 40 if you missed the rally, which names have more room to run. Lets bring in the director of research ken, great to have you with us good to see you do you scratch jour heyour h . Youre getting this roes si picture from a lot of the builders what do you make of the consumer now . Debt is a record low. Mortgage is about 42 . Were going to be seeing an amazing shift in terms of appetite for Single Family homes. Yes, theres a shortage. Were getting good weekly data in terms of demand theres a lot of households looking to the suburbs to make that change from expensive rentals. The rent versus buy decision is more appealing for buying. I disagree in terms of pricing coming down. The reason price came down was not incentives to get demand going. Its because the entry level new home buyer is getting a smaller home of 1800 to 2000 square feet thats why the builders are showing lower price. Households whether they are sipping lattes in manhattan and have one child and one coming or its in awe stustiaustin, texasx and you have great chance to move into new Single Family homes that have all the appeal youre looking for that werent there a few years ago. What kind of home builder is best positioned to take advantage of the strong consumer Toll Brothers focuses more on the luxury, the higher end maybe that sort of consumer is stable in his or her job in the lower end. How do you look at that . We beg to differ. They are depen dent dent on a sg stock market its a big shift to entry level. For investors looking for large cap stocks, we like dr horton. Its a strong buy. We call it the walmart of the industry calling something walmart today is good thing. Its got great scale and builds Affordable Homes we have two other strong buys that are targeting the entry level buyer with all their selling communities. One is Meritage Homes that went through major change you come into their selling communities. You have a choice of five or six models very clean lay outs. Maybe theres 15 to 20 that boosts the velocity of sales. Kb home is another one the analysts dont like it we do. Strong buy they build to order but they are well positioned in markets what is the one Economic Data point that you have on your screen that you follow very closely when it comes to monitoring the health of the end user of the companies that you follow, ken. Its absolutely unemployment. Keep in mind that unemployment which is dire in the u. S. But the majority of that is for household who is cannot afford a Single Family home when we look at the middle to upper income, those that are professionals, those who have been really in urban markets, theres a lot of demand there. Right now, the total available homes in the market is less than half of where it was over ten years ago. Single family homes are attractive for the reasons i mentioned before even maybe for Health Reasons moving it to a home where theres no risk either to mold or to covid19 thank you thank you still ahead, talk about a comeback oil on track for its best month ever the traders will tell you how they are playing the rebound plus as we await trump he is going head to head with jack dorsey as the social media giant senatored another one of his tweets well tell you what that btlate means for the stock. That is straight ahead thats why usaa is giving Payment Relief options to eligible members so they can pay for things like groceries before they worry about their insurance or credit card bills. Discover all the ways were helping members today. A portion. A chunk. With dollarbased trading you can spend what you want, even on just a slice of a share. Truly transformative sleep. So, no more tossing and turning. Because only tempurpedic adapts and responds to your body. So you get deep, uninterrupted sleep. During the tempurpedic summer of sleep, all tempurpedic mattresses are on sale during the tempurpedic summer of sleep, iits not acceptable oor nothing. And its definitely not close enough or nothing. Mercedesbenz suvs were engineered with only one mission in mind. To be the best. In the category, in the industry, in the world. Now, get 0 apr financing up to 36 months on most models and 90day firstpayment deferral on any model. Mercedesbenz. The best or nothing. Lets get to sue for a cnbc update heres whats happening at this hour. Former Minneapolis Police officer Derek Chauvin has been arrested and charged with thirddegree manslaughter. He expects charges will be filed against the three other officers who were involved. Former Vice President joe biden says the death of george floyd in Police Custody has krae created an open wound for the country. Hes criticizing President Trump for what biden calls comments that divide the country when unity is needed. Its always there weeks like this, we see it plainly that were a country with an open wound none of us can turn away none of us can be silent none of us can we hear the words i canword wordword i cant breathe and do nothing. New jerseys governor says the state Child Care Centers can reopen on june 15th and some organized sports can resume on june 22nd provided safety precautions are taken and put in place. Youre up to date. See you next hour. Back do you. Thank you now over to seema trading nation we are watching oil here just minutes from closing out its best month ever. West texas intermediate crude, get this, up 80 in the month of may. What does this mean for Energy Stocks lets bring in the trading nation team to discuss we have Craig Johnson and Steve Chiavarone stooe steve, which part of the Energy Complex would you be a buyer of . Its really remarkable whats happened when you look at this base, our story has remained the same. Companies with good strong Balance Sheets that you know will be around in two, three years as this sector consolidates and can pay a yield in the meantime to provide the best opportunity for long term winners. These are the integrated we continue to stand by that we dont like it too speculative. Craig, why havent energy stoc stocks kept up with the gains we have seen in oil so far . I think at this point in time, let me say first off were neutral energy right now but we see some select opportunities. I think the reason that youre not seeing crude oil stay in sync with what youre seeing is there seems to be a bit of a disconnect between what youre seeing between the supply, whats happening with the demand side and right now when i look at the crude oil price