Today. Down by 1. 5 . Well dig into that over the next two hours. We begin with the banks. Dan warner is a banking analyst at morning star. Great to have with you us. Dan . I dont understand why one would be invested in banks right now unless you simply wanted to preserve or lose capital. Give me the bull case. The bull case is that if you with the strong economy, with the low cost and positive thats we, have were still seeing strong loan growth. I think i mean there are headwinds. But for longer term, i think you still want to be in banks. The fed will raise rates at some point. It always seems like the last few meetings when he some excuse or some reason at the last minute why they havent raise the rates whether its geopolitical or a jobs report. They will raise rates. I dont i dont think its going to be quite maybe you may see one before the lection. I think that lection may have smim pact on the timing of the rate increases. I would look for it more december or thereafter. So i think, you know, given the relative valuations, especially on a citigroup which is trading at 70 of tangible book, i think you want to think about that name. Problem i have, not a problem, but i mean, the bears will point out that if you take a look at a name like a citi, for instance, its down. The dividend yield is 4. 7 . The dividend yield is 3 mark. In the notes with the producer, you are saying take a look at the reits. Does that mean you do not like financials . Melissa, we like financials. I think you almost have to if youre going to be an investor that is broadly diversified. They september a little over 16 of the s p 500. You have to have exposure. We happen to be long citigroup because it is so cheaply valued. But we have a neutral weight on financials and within financials, we have no asset managers. We have no investment banks. And importantly, reits for the benefit of a low and slow growth in rate environment which we think will be perpetuated by the numbers we got on the jobs report today which is indicative of a lack of hiring. Its not turning into layoffs just yet, fwhbut this lack of hiring doesnt mean we dont have the inner shah to warrant the foed raise Interest Rates. Dan, i go back you to. You spoke about the better economy when you led off the show. My question is what better economy do you see . The isms i see are disaster. At best the economy is struggling here. Then i would also point out that two tens are at the lowest level since december of 2007. That doesnt sound like a great environment for banks to me. You still have positive gdp growth as opposed to our neighbors like canada which is seeing negative. You still see the consumer is spending. But theyre trying to also maintain their better balance sheet. You know, the wage growth i was somewhat pleased by, you know, up. 4 . I think there is still some room to go here before we see it. But a lot of points, you have a forehand on unemployment. And with wage growth, you wonder if were at a peak here. All right. Going to leave it there. Thank you. Over at morning star. Just quickly, i want to you sound except caskeptical of the. We have a news alert. Im here. I have an oil patch alefrmert. Its baker hughes and we have the second time this year in 2016 that weve actually not lost rigs. We added rigs for the second time this year. Total rigs on the oil side of things, up nine to 325 rigs. Total rigs are up four. The one we care about is the Oil Rig Count with it plus nine at 325. Well also note here that on the oil rig side of things, were down 317 from the same time last year. So this time around it looks like were adding again. This is the second straight week where we have not lost rigs on the count. Back to you. So were increasing the second time. Increasing rig counts. They came in and spoke. That marked the bottom of the market. Rig counts didnt go up for the first time in a long time. You wonder if that meeting yesterday with this rig count number, will that bode to be the top of the market . I say yes. I think yes. The obx is telling me Something Different. I would submit we saw the highs in oil earlier this week. I think were going lower from here. Look who joined us. Im here. Josh brown. Jetson meeting the flintstones. Whats your take here on oil . I think guy makes a good point. This was the big fear all along. We were going have this oil recovery. Everyone was going to come back and try to sneak back on to the market. This is now week two. I think that is a risk for oil. But what will help oil, i think, is the fact that the dollar is now falling back off again. So you kind vf a little bit of a push and pull. It may be premature to say well see a three handle. But mid four shouldnt shock anyone. Lets move on to gold here. Rallying on that weaker than expected jobs number. Eric, where do you see gold heading right now. It is all about the dollar . Yeah, certainly we saw during the month of may in anticipation some of rate hikes, gold dropped down from 1300 to almost 1200. A lot of people getting short. That pushed the gold back up to 1245. Its not such a big squeeze. Certainly we can see the market back up to 1300 again. I ask you a quick question. You say its about the dollar. I dont think its about the dollar. My sense is that gold move has been more a play against fiat currency. 10 trillion now of sovereign bonds have negative yields. I dont know what percentage that s but the number itself is ridiculously high. When japan went negative that, was a green light to buy gold. Do people talk about that . Surnt tcertainly that gives e value. So whenever we do see currency destruction, whether its the Australian Dollar or the japanese yen, you certainly should have some part of your portfolio in gold. All right. Eric, thanks. Gold miners are doing really well. Yes. Thats what they exist for. You would certainly expect to see a much bigger move in the miners than the metal. However, still longer term in a down trend on both. Frankly, im shocked that gold is not acting better given what guy is talking about, given the dollar falling off. I dont know how happy can you be with a bill len fit you got. You think you have every condition for a huge gold rally that is better than 2 . Josh makes a great point. I thought gold could be up 35 to 50 on everything we saw today w that said, im convinced that youre going to walk in one day, gold will be up 50. Everybody will say to fade it. Next day, the same thing will happen. Its as strong as its been in my lifetime. There is Something Different going on. Gdx absolutely in a down trend. The miners is the place to be since december. I think you stay with them. Simon, over to you. Thats the number of cost created in may falling well short of the 162,000 estimate, less than a quarter. So what now . Here are our all star jobs panel. It feels like a very big day, ron. Is this something that is more fundamental . It is more fundamental. We have seen deceleration this morning. Also in the downward revisions in the prior two months employment numbers. Manufacturing he is infectively near or in recession in the United States and certainly around the world. The risk there is morris tokt down side in the economy than upside, i think. Bill . Sure. And along with the deceleration and the payroll numbers that ron mentioned, weve seen three months of decline and participation after it had been edging up. That suggests that people are leaving the labor force. Where does that leave us on Interest Rates . Youre still driving down the Unemployment Rate to 4. 7 . That is very close to full employment for a lot of people. Its down to what we may call full employment territory. But the Participation Rates are still almost historic aloes. If you compare going back to previous recoveries or expansions, you know, similar Unemployment Rates, we have much higher Participation Rates. So to get to your question, bottom line on policy, june rate increase of 25 basis points. Thats off the table. July, i think the odds go down a bit. Too. There i start to get concerned that were moving too close to the lection cycle. See, ron, there was a time when we thought that Interest Rates were coming off the table and other central bank wobz forced to do more to stimulate asset markets, that the stock market would rise. We havent had that today. No, we havent. Thats because dlz theres beens lingering thought. I dont think they have the latitude given the weakness in the global economy. As you get closer to the election, if the fed were to trigger some sort of market down turn with a september rate hike, that does affect politics as much as it affects economics. I think the fed given 23 countries around the world had negative rates. They carried negative rates. It gets harder for the fed to pull away. If you follow that to the logical conclusion vein a november election, you may not raise rates until december again, a full year. Will they get a rate rise this year . Ill fall back on what the governors have been saying. Theyre data gendependent. Right. You know, theyre data dependent. The data have not supported a rate hike. The core pce inflation rating is still below 2 . You know, Wage Inflation is not that big. Its 2. 5 year over year. Its not the type of thing that triggered rate hikes in the past. We have to leave it. There im sorry. So bad news bad news once again . Once upon a time, guys, a bad jobs number meant that the fed wasnt going to raise that meant free money forever and great money for the stock market. Here we are today. Thats what we v what is your interpretation . I think the street likes the status quo. I think the street was ready for 25 basis point rate hike. But theyre also ready to not have a rate hike. Just two weeks ago. I think it was 50 50 amongst traders. I dont know that today is like this is bad news so its terrible. Its like all right, its bad news so well talk about rate hikes for 30 days. Thats okay. Look at the reaction in stocks. Pretty muted. I think that is more of the same is okay. Pretty muted on the top line. Yeah. But when you take a look, there is a real risk aversion. Josh pointed out that were talking tens of thousands of jobs in a workforce of 150 or so Million People. But these are the numbers that they look at so we need to look at this. Is the fed data dependent . If they are, unemployment went down 4. 7 . That is a headline nup number. Thats what theyre watching. So given all the banter we heard frefr fed official over the last couple months, they need to do something. Now if they dont do something, the credibility issue that they have that i feel they have is only going to get worse. To answer your question, is bad news bad news . I think the box that they painted themselves in gets smaller and smaller. One thing, the wage increases stuck. People are like this is horri e horrible. Will is a silver lining. The wage increases stuck. This is the thing that the fed has had the hardest time getting to happen. Its not rip roaring. Its not anything in the 90s would look at and get excited. But its better than no wage increases. As long as that sticks, i do believe can you be more constructive than deinstructive when you think about what is going on economicly. Ten year yields are ten basis points. 1 lower on the day. The best performing sector today, no surprise. The utilities. They set an all time record intraday high. Breaking the prior record. That was set about a month or so ago. This Interest Rate sensitive index is up 16 this year as the fed signaled a rate tike some time this summer, maybe. But given all the talk that you were just making in terms of rate hikes and what the jabs dada jobs data means, utilities will be there for investors if they get tabled for a little longer. Thank you. I mention ris 5 00 version, thats what im talking about. The move in the bond market in, utilities, wean the pe for the sector more than 22 people still want to buy these. Doesnt matter, right . Its hunt for yield. Now xlu, all time high today as dom pointed out. Im not trying to compare. Go back to 2007 when xlu was on this huge run. Recall what happened in the months that followed. Im not suggesting thats what were in for. This isnt bullish for the broader market. When xlu leads us higher, there is something wrong. Bond yields remain stubbornly low despite what everybody else seems to want to happen. I think is the dumb money to speak very candidly. The kind of investor that has the mindset that utilities are historically defensive. I know i need equity exposure. Im going to buy something defensive. Youre paying up all time high and epic valuations. By the way, same people doing this with Consumer Staples which is starting to look like a head and shoulders top. Sari to till. I do not think this is well educated money. I think this is throwing money at low etfs and the type of vehicles that purport to give you equity structure. Youre not going to like this bond flavor. All right. These guys are sticking around. Meantime, some call it the super bowl for pharma and biotech. It is the biggest Cancer Research conference of the year. It kicks off today. What will drive stocks and move medicine forward this year . Great time for a shiny floor wax, no . Not if you just put the finishing touches on your latest masterpiece. Timings important. Comcast business knows that. Thats why you can schedule an installation at a time that works for you. Even late at night, or on the weekend, if thats what you need. Because you have enough to worry about. I did not see that coming. Dont deal with disruptions. Get Better Internet installed on your schedule. Comcast business. Built for business. The top financial regulator in new york state has sent out warning letters to some 28 peer to Peer Lending Companies to ask for information on their Business Practices and whether they may require a license in new york state. This, of course, follows a controversy and multiple investigations into the San Francisco based lending club which the department of Financial Services subpoenaed last month. The Justice Department reportedly also looking into them. This is an extension of that inquiry, guys. Aims to get more information about other companies in this line of work and whether or not they may be running into legal issues as well. Yep. And the stock falling as you speak, kate. Thank you very much. In the meantime, the biggest Cancer Research conference of the year kicks off today in chicago. So what will drive stocks and move treatments forward over the weekend . Our pharma reporter is here to break down what we can expect before she leaves for the conference. Thats right. Leaving in 45 minutes. So this is the big show. A lot of the biggest cancer drug makers presenting data over the weekend and early next week. This has really turned into a big pharma meeting where you see Companies Like bristolmyers and merk competing in immune yoe therapy. You also have roesch in there. Those are the Big Pharma Companies that we should be watching over the weekend. Of course, it is often the smaller names that move more into next week. So we actually asked a Data Analysis tool what previous people have told us about the most positive movers out of asco. They returned five name, Seattle Genetics, ionis pharma and finally halozyme of the companies, Seattle Genetics is a good one to watch. We will have the ceo joining us on power lunch on monday as well. We look forward to that. Stick here. Lets bring in our biotech analyst. He is joining the conference today. He joins us today from chicago. Meg gave a good rundown of what to watch. Which ones are of interest in your coverage universe . Great to be here. Following on megs comments, not only ariad which has big data and kite. Kite is one weve been talking about for a while. Its been a great run for biotech investors over the past three weeks. Biotech up is 12 or something like. That outpacing the s p 500. When the jobs number hit this morning as disconnected as they may seem, it created a risk in the environment. Are you concerned about biotechs the rest of the year given the change in tone that seemed to happen today . Thats great. So look, i think in the short term, weve had a nice move in the Biotech Sector like you said, 12 . The ibb seems to be locked in the channel. It bounced off 250 support levels a couple time. Moved up to 290. And i think thats been healthy. Weve had support levels and i think that we can move higher. The keycy think were looking for a better political backdrop. Were looking for the steady beat of m a. It has been a big theme over the last couple of weeks. And were looking for important political dat yachlt as the political backdrop clears up, people have more confidence to buy the stocks which are still down year to date. Mike, its meg. Just curious to know your picks on m a. We have seen med sahratian bandied about. What other names may get taken out in the near term . I think that ariad which is one weve been talking about here and you mentioned, you should ask the ceo there. Theyre definitely viewed to be a Strategic Company that would make a big fit in blood cancers. Obviously sort of, you know, later this year were thinking about biomarin. Youre hoping the political backdrop would get better. By that im assuming the political noise about price rises and what we do about that in the future. Smell out what would you hope to happen in the runup to november . What are you saying here . Thats great. So, look, i think that couple things are going to be watching for, number one, obviously political debates. You know for the general election are going to be coming up over the next couple months. People are concerned about what the candidates are going to say. Obviously, theyre going to be talking, you know, big ideas that could be scary. But i think that people are looking for things that are not dramatically game changing, things that we are not new and shocking. I think if theyre lower in the aagenda yashgs you know, i think there are a lot more important things going on in the