Week on wall street and the dow component pretty much responsible for keeping the blue chip index in positive territory for the week as the Company Releases its iphone 7 smart phone. We will look at whether it is worth upgrading and whether the stock can keep rallying. Twitter moving higher after streaming its first nfl game last night. It was kind of cool. Pretty cool. We will get the ratings any minute now and tell you what they mean . And the government fining Deutsche Bank over Mortgage Securities probe. How does the government determine the extent of the fines . Lets start with a look at the volatile week. Would have been quite different outcome without apples gains. Bob pisani has the story. The biggest stock has the biggest gains. It not only moves apple but the entire stock market. The bigger stocks move the indexes more. Apple is the big one in this space. How big was the movement . Let me give you an example. The s p 500 is up about ten points this week. Apple is responsible for seven points in the s p 500. Most gains this week for the whole index is due to apple. Let me show you another way. The s p 500, apple is about 3. 4 of the entire s p 500. This is 500 stocks. Apple is 3. 4 of that. In the Technology Sector its 16 . There is about 65 stocks in the tech index. 16 one stock out of the 65. Thats how big apple has become. Let me show you another way. The s ptech index, there is an equal weight tech index. All tech stocks are equal weighted. The tech index which is market cap weighted is twice as much of a gain as the other one because of apple. Thats going to give you an idea of how big this is. The alltime big cuhewna in this space was ibm. Back in the 1980s ibm was almost 6. 5 of the weight of the entire s p 500. Thats twice what apple is right now. Of course, those days are long gone. This is a very rare week to see one stock move the market so much. Early to mid 80s ibm was the market. Lets get to closing bell exchange. Nancy tangler is with us today. Peter costa is at post nine and Rick Santelli checks in from chicago. We have a lot of things to happen before the closing bell. Quadruple which it is a great time for traders on the floor. Our clients have a lot of opportunities to trade. We love this and the volumes are there. This is a big money day for a lot of firms down here. As far as like the investors i think they cant when you look at the paper tomorrow morning you will see the market was down 100 points on 4. 7 billion shares or some outrageous number, people say oh, my god. There is so much volume that i think we take this day out from the overall picture of what happened this week. No question about it, volatility not just in todays session but in the week. It is september which means the summer lull is over. How are you positioning ahead of a big week with the Federal Reserve and the second half of the year . Thanks, sarah. We are using volatility to add to specific holdings that are attractive on a valuation basis and on price overall basis. We have been overweighting health care throughout the summer. We moved to overweight about 40 overweight and the same with technology. We have been buying and picking up a number of names and adding to holdings in the space. We have already been at a full position at apple. We may be doing the opposite there shortly. Otherwise we are upgrading the quality of the portfolio. Next week we have the fed meeting. Do you expect the volatility to continue as a result . I think it will start to ease off. Does anybody find it fascinating that the eu wants 14. 5 billion from apple and our department of justice wants 14 billion from Deutsche Bank. Coincidence, rick. Coincidence. You want to watch the banks. I especially invite all members to watch the banks for the next couple of weeks because the word is i was reading in the Evening Standard uk and dow jones reported that the european banks are not happy with the speed of bazal and the reforms and what it means in terms of more margin, more securities on tap, more requirements because theyre not in good shape. Why do i want all members to Pay Attention . Because negative Interest Rates are not helping the matter. Deutsche bank wasnt only down because of the potential for the fine. Unlike apple they dont have the dough. One reason they wont have it anytime soon is because with Interest Rates where they are, where are they going to make money . I think this is important because i think it all ties in. What we may lose in volatility is the Central Banks give the market what it demands we may gain on volatility is this story about how it may be too painful if moving too quickly. I think that will prove to be a big issue to Pay Attention to. A lot of ideas in that one. Gives us plenty to think about. How about the yield story . We looked at the ten year 170. There has been a lot of hand wringing over the backup in yields which wasnt so dramatic if you look at the change from last week. Do you expect it to continue and for it to be destabilizing for stocks . I think going into next week you will continue to see that. Its going to all boil down to what the fed comes out with on wednesday. I would be highly surprise ized if they raise rates. It doesnt seem to be the case for it. They might have said something about inflation being a little better than what we expected. I really dont see it happening. I dont see it happening in december, actually. Nancy, you caught on to something rick was saying about the Deutsche Bank fine that doj is seeking so far. We had talked about that during our production meeting earlier. Is it a coincidence . Look at what Deutsche Bank is doing down over 9 in the market. Are you ready to step up on some of these stocks yet . Are they representing value in your view . They do. I think the worry that we have as value managers is when you are too early you are wrong. I think the eu has much less flexibility and power after brexit. If we get progrowth policies in the u. S. After the election and companies are incented to bring back earnings and jobs to the u. S. They are going to find themselves in a very precarious position. I do think International Stocks are beginning to look attractive. They certainly do from a valuation standpoint. It has been a long haul particularly for foreign banks. So we are taking a look but we are not there yet. We have breaking news on johnson johnson. Seema mody has details. Another deal in the health care space. Its a wholly owned subsidiary of abbott labs. The deal is expected to close in the First Quarter of 2017 and just to give you perspective on how big the subsidiary of abbott labs is it reported sales of around 1. 1 billion in 2015. The acquisition primarily eye related. Three business segments, cataract surgery, laser refractive surgery and consumer eye health. Both stocks were moving higher on a report that the deal was coming together. You can see shares of both abbott labs at session highs around 1. 5 . Back to you. Thank you. Nancy, if you are still with us, i know you look at valuations and you have some health care exposure. You expect these deals to continue to pick up . If so what names do you like . I do expect it and last time i was on i talked about abbott as one of my picks. It is a company that is usually an acquirer. This is especially good news and i talked about j j which hit higher valuations. We like amgen and medtronnic. Medtronnic is a superior name in the space. We are adding to our holdings in both today and have been over the last few weeks. We really like the space despite political head winds and the normal worries over fa pharmaceutic pharmaceuticals. We like this stock very much. Very good. Folks, thank you all for joining us today. Well let you get to all that is going to happen over the next hour here. We will be standing aside as everybody is running past us on the trading floor. The other thing, there is a rebalancing coming and a creation of an 11th sector inside the s p 500. The Real Estate Investment trust. Odd number. They have to come up with it pretty soon. 49 minutes left in the trading session. The dow is down about 100 points. Going into today the dow was up 120 plus points. We are almost break even for the week. We have been talking about this big story. The Justice Department wanting 14 billion from Deutsche Bank to settle toxic Mortgage Securities claims. Deutsche bank says no way. We will tell you what the analysts think the bank will likely pay and we will speak about how the department determines the size of the fines. Long lines outside of Big Apple Store on fifth avenue. How about in Silicon Valley . We will go live to palo alto for channel check for demand of new iphone 7 coming up. Youre watching cnbc, first in Business World wide. Before a bunch of dreamers looked up to the sky and said, why not . And Collaboration Tools from intel made Rocket Science simple for actual rocket scientists. And the launch crew met for a moment of reflection. Before any of this, cdw orchestrated a collaboration solution using pcs with intel 6th gen core vpro processors. Collaboration by intel. Orchestration by cdw. Mary buys a little lamb. One of millions of orders on this companys servers. Accessible by thousands of suppliers and employees globally. But wion the rise,eats marys data could be under attack. 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Wells fargo is one of them lower for a sixth consecutive day, the heat intensifying on ceo john stumf who will be testifying on capitol hill to talk about fake account scandals. So wells fargo waits its hearing next tuesday the bank was dealt a further blow as it emerged they would have to face an additional hearing in front of the House Financial Services committee, a date for which is yet to be set. Wells share price has declined 9 since the news of the fine relating to misselling of accounts to consumers broke late last thursday. Shifting focus to another bank. If you thought that decline was bad check out shares of Deutsche Bank closing down just today as news leaked that the german lender is facing a fine up to 14 billion in response to Mortgage Backed securities fraud. An issue that has seen americas biggest banks fined. The decision was expected but the potential size of the fine a surprise. The final sums paid were significantly below initial leaked numbers and Deutsche Bank expects final fine to be less. A very high number. This was the case with other banks with our peers in the United States. We saw the numbers go down significantly and so we are very confident that we will be able to negotiate this number significantly down when we are sure that we will treat it fairly in this process so we are quite optimistic this number definitely wont be the final one. Deutsche banks head of communications there. Both cases wells fargo and Deutsche Bank case highlighting that regulator environment remains incredibly demanding. The ten year yield is higher. Nist past few sessions, months and year that would mean that banks were outperforming. I wonder if the Regulatory Risk is overtaking Interest Rate risk which was driving stocks before . I think the issue has had an impact on stocks. Lets remember why yields have gone up. Banks take their profitability very much over the short end of the curve. And the fed funds rate, we have seen this tick up over the last week or two. Not because we think rates are going to go up. I think it is very much the regulatory environment. The rate hike aspect still there. Its hard to quantify but 9. 5 move down you wonder if the market does sense they are paying something. Not going to pay 14 billion. Higher number than they are expecting or hoping to pay. I think the bill comes down to an example. If you take Goldman Sachs initially the number was 15 and settled at 5. Deutsche figures were 2 billion to 3 billion. Even if we are expecting roughly a third like the others it is a lot more than 2 to 3 billion. It is not 14 or half of that but if it comes in at 4 or 5 is a lot more than analysts had in already. We come back to the point that i have made for a bank trading at such a low price if the capital to have to pay is more than expected i may have to raise capital is much more costly. Down 45 so far this year. Thank you. Have a good weekend. Have a great rest of the show. See you early monday morning. There are a lot of questions surrounding the process of how the doj issues the fines and settles on the figures. Our next guest may have insight into the questions. A partner at snell and willmer. He is a former doj official and joins us right now. I have so many questions for you. First of all, how do they arrive at a number like 14 billion . How does that process begin in the negotiations . Good afternoon. Im happy to join you. The number that doj has offered is generated through a calculation of actual losses associated with the conduct at issue. Here we are focussed on losses associated with the packaging, sale, marketing and origination of residential mortgagebacked securities. The way that these settlements have been structured in the past i think is probably predictive of the way that we will see this negotiation play out and ultimate settlement be arrived at. To break that out a little more for the viewers, taking bank of america as an example which settled for a fairly high amount, 16. 5 billion, there were two main components of the settlement. One was about 10 billion used to settle state and federal claims arising from this mortgage security activity. And then the other component was effectively an aid package that was made available to previous borrowers, new loan consumers and also as a donation to communicates that were particularly affected by the mortgage crisis. So james clearly its in line with other figures. There are questions being raised as to political motivations given this comes a few days after European Commission ordered apple to pay the Irish Government in back taxes. Do you think the political considerationvise merit in this case . I dont think that there are Political Considerations that are tied to what just happened with the European Commission. I do think that there has been pressure on the department to take action as a consequence of the financial crisis in general and the mortgage crisis in particular. So i think that the department has staked out an opening offer that is quite striking at 14 billion for Deutsche Bank. I would expect that we will see this play out as a negotiation. The ultimate number will ultimately be less than what is reported today. I expect it wouldnt be substantial. So if the 14 billion is based somewhat on the losses incurred, so what is Deutsche Banks or any banks leverage . What is their argument to lower that amount . How do they possibly negotiate to bring it down if they are liable for that kind of money . So these negotiations are complex in that they involve legal theories and liabilities. And there certainly is always litigation risk on the side of the department. There is always a danger that their calculations or their legal theories may not stand the true test of judge and jury. So there is that incentive for the department to resolve the matters by way of settlement. It is also true for purposes of the market generally it is better for the department along with Deutsche Bank to resolve the matters by way of agreement. That is a factor that the Department Takes into consideration when it is reaching conclusions about appropriate settlements. So this wont go down. I expect it as in the previous negotiations and as in negotiations generally that it will be reduced ultimately. Thanks for joining us today. Appreciate it very much. Thank you very much. Less than 40 minutes to go before the closing bell. Lets look at where we are. The dow is off the lows of the session. It is still lower down 88 points. S p 500 down. Nasdaq is having its best week in two months thanks in large part to apple. 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