Skip to main content

tv   Closing Bell  CNBC  July 11, 2013 3:00pm-4:01pm EDT

3:00 pm
weeks since we went live. we are very excited to talk to client about potential uses for it. >> i just played with the point stick. anything you program. the bar, city can program it and point you into that direction. >> right and not just any bar but the trending bar. >> ma sassage parlor, anything. done. >> i hope you do these here in new york. thanks, guys. good luck. >> thanks. >> thanks, guys. >>. . hi, everybody, welcome to "closing bell." we're at the new york stock exchange. this market on track for a record high close now up better than 1%. >> all 30 dow components have been trading higher so far today and s&p's in the green for the sixth straight day. the dow and s&p are both up more
3:01 pm
than 3% in the month of july. nasdaq is at 13-year high. up 5% and in that time, what happened to june in the june swoon came and went. >> remember when bernanke calmed investor fears about economic stimulus tapering plan. coming up, we will hear from one big bertha says all of the fed's moves will end up back firing on this market. >> oh, harry, harry, harry. let's see where we stand right now. the stocks this morning are like race horses at the starting gate. just itching to get out of that starting gate. they took off this morning. up 60 plus on the open. then side ways. then just in the last half hour, another move higher. dow is up 175 at its peak about 15 minutes ago. just off that with a gain of 163 with 15,455. nasdaq is up 53 point for levels we haven't seen since october of
3:02 pm
2000. so 12 1/2 year high. if you want to put it that way. saip in record territory. above 1669. up 21 point. . >> we got technology, economically sensitive, after a the june swoon down, s&p 500 less than an hour from a new all-time high. let's good to bob pisani, over to you, bob. >> mr. bernanke and traders didn't say much before close but the emphasis on the policy remaining for the foreseeable future, the psychological effect has been to take the edge off of the tapering fears. tapering may still occur but the zero from rate policies mr. bernanke played clear will be for some time. take a look at the dow. we are in record territory. we close here. same situation with the s&p 2500. why didn't we move up in the last hour? large tech stocks helping. in the last hour by intel,
3:03 pm
microsoft, orkel, jds, all big cap names here that help move the markets forward. growth oriented stocks ptoday. that hasn't happened in a long time. big under performers. won't report particularly greaternings. but look what they are doing today. this is the best day since going back it october of 2012 as mr. bernanke calmed the fears of rising rates. lock at 7, 8% movers up across the board and hope builders. emerging markets. just a disaster for the second quarter. that's the only way to put it. many down like turkey and philippines. today all of them making a come back. less fears out of companies as the low interest rates scenario is going to continue. sell into earnings season. banks report tomorrow. j.p. morgan and little less flatter yield.
3:04 pm
i think is lz causing people to lighten up. >> more flat -- >> yes, sorry about that. i mangled that one. >> your english taeeacher is on line two for you. in today's action, jany montgomery scott, damon barglow, danny hughs, rick san telltelli course. and we will hold your feet to the fire, my friend. back in march, you made a shocking market call at that time. listen. >> actually under a scenario analysis, as we painted 30% probability over t-1680 on the s&p 500. >> where do you see 1680? >> by the end of the year. >> and you could hear crickets chirp when you made that forecast at the time. and here we are 7 point away from it right now in july. are you surprised we have come
3:05 pm
this far this fast? >> it is faster than i anticipated, i must admit, bill. but i'm glad we were largely right at least directionally on that call. we continue to think we will see further upside in s&p 500 before it is all said and done. we remain optimistic in mid year outlook we additionally raised our forecast to where we think the s&p might close even above 1680. >> damon, what about you? how do you see this market? do you want it buy into buy intg rally today? damon? >> oh, yes. hi there. >> hi there, damon. >> i was also surprised by today's rally. however, the market is still -- was clearly worried about bernanke taking away the punch bowl. the fact that -- >> well we've got real gains. triple digit rally. we know what was worrying the
3:06 pm
market but what is driving this market and would you buy into it? >> clearly, there's -- it is liquidity. there is a bid back in the bond market. they will not take away the bond buying program and that is a positive for short term rates. i still think there is risk at t the long end of the curve. >> dan you would do the same here? >> yes. reactors love that taper talk. that gives them the opportunity to buy the market over last place over the last month. but for mortgage rate though that didn't do that well, the 30-year is up considerably from lows of 3.3%. and now at 4.5%. but there is a couple of good things going on. s&p 500 out of those 500 stocks, 448, this is as of yesterday. not as of today.
3:07 pm
but 448 still yet to hit the price targets. in addition the ipo market in the first half of this year, 2013, has done 23% better than the first half of 2012. i think we had something like 96 new deals this year compared to 78 or so last year. those are actually really great data point for this market. >> rick santelli, what do you see is going on in fixed income? >> anyone participating in markets on 10s yesterday or 30s today are dancing on rooftops. it worked in their favor. if you look at 5 year, 10 year, 30 year, it totally jumps out at you. so 5 versus 10, 5 versus the bond, they have all steepened and the reason this is significant with because the 5-year sold off so much more aggressively than the rest of the curve actually flattening
3:08 pm
those traits so we are seeing normalcy. if we close under the low, first time since second in july. dollar index took a real hit today. as a matter of fact, should it settle here, two-week low yield and for all those that say the fed will not raise rates, i say, go to your screen, turn on the 10-year because it looks to me like we went from 4 1/2 quarter point tightenings to 3 1/2 quarter point tightenings. it just wasn't work straighted by the fed. market yields have gone up. when i hear everybody say, yields aren't going up to 2015, they are obviously not looking at the screens. >> yeah. damon, you feel that the bond markets overreacted to all of the talk, don't you? too much selling of the bond market, right? >> oh, absolutely. i mean, i think what bernanke said in boston yesterday was very appropriate in terms of
3:09 pm
letting people know that even if there is a tapering process, rates could stay low for a long time. and as we all know, forecasters are almost uniformly overly optimistic or rather pessimistic about rises in rates. and i think the magnitude and the timing of rate increase says going to be very difficult to predict over time. >> so you would buy bond here, would you? >> at rockland we take a very diversified approach at portfolio management. so yes, i do think -- i think bonds have a very important place for capital preservation and providing some yield in portfolio. >> all right, thank you all, folks, for your thoughts on today's market as we perhaps close at all-time highs. get ready to do that here. >> we are above the all-time high now. with just about 50 minutes before the "closing bell" for the day. a market that is up 160. very close to the all-time highs of date.
3:10 pm
>> fed chairman bernanke, the speech last night, you saw it here on the "closing bell." but harry dent says this market looks more and more like a bubble ready to burst. >> also, director larry summers reportedly hell bent on succeeding bernanke as federal reserve chairman. we hear from some who say picking summers could be a disaster for the economy. >> could spiking gas prices our recovery? we will hear from both side on that coming up. >> don't miss special coverage on this market. bill an i are joined by cohost of markets at all-time high, all tonight at 7:00 p.m. eastern. creating new opportunities for those who stand ready to seize them. in a time when the biggest risk is playing it safe, we believe outshining the competition tomorrow
3:11 pm
requires challenging your business inside and out today. at cognizant, our flexible, collaborative approach helps forward-looking companies not only run better, but run different... to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because now more than ever, the future belongs to those who challenge the present. vietnam in 1972. [ all ] fort benning, georgia in 1999. [ male announcer ] usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection
3:12 pm
and because usaa's commitment to serve military members, veterans, and their families is without equal. begin your legacy, get an auto insurance quote. usaa. we know what it means to serve.
3:13 pm
weight loss programs are great. but they can leave you feeling unsatisfied. ♪ give in to temptation, with sinfully delicious slimful chews. they taste like cheating, but one 90 calorie slimful chew and a glass of water can help satisfy hunger for hours. so you get the sweet chewy treat you crave and stay on your program too. slimful and a glass of water. eating less never tasted so good. we are highlighting the rally in stocks today. dow trying to close at a new high. but rally in gold is the other big story today. bertha coombs with details. >> gold up for four straight sessions on pace for a near 6% gain for the week. ending here at a three-week high. tomorrow a lot of traders will see if the momentum continues
3:14 pm
and it will push above $1300 an ounce. of course the weak dollar if the wake of the bernanke comments, a big factor today. but it didn't help wti, we saw profit taking there as it hit a fresh 15-month high above $107 a barrel, particularly at the front end. that said, it is still on pace for an 8.5% gain this week even with today's pull back. and gasoline is on fire on pace for an 11.5% gain. month to date on those figures. 11.5% so far in july back above $3 to three-month high and that is trickling down to the pump. we are seeing increases day by day here and got to wonder, bill and maria, one that's going to start to really hurt here during summer driving season. >> yeah. absolutely, bertha. is this recent spike in gas and oil a threat to economic recovery. >> let's go to cnbc contributor
3:15 pm
and brian from oppenheimer funds. john, how much higher to with he good? >> bill, i'm very bearish on oil. i think we might have scent top here. might have installed a double top today's price action. as bertha said, pipeline headline risk. major pipeline, causing selling here today. but so this is still rippling through the pump, bill. we could push up against 375, 380 on national average. much higher than other spots, obviously. but that's what we are looking at in the near term. >> brian, my question is the impact of all of this. the last time we saw oil at these levels, it did put a crimp into the economic recovery and i'm wondering if we're already -- we have gone down that road. how significant is this move to the recovery in terms of zapping consumers ability to spend? >> it certainly matters. when you look at consumer
3:16 pm
confidence report from a month ago, that is before we saw volatility in the equity markets and before we saw the recent move in oil and gas prices. we were feeling better. but any time you are in recovery, you are trying to get going and you get hit with a higher price at the pump and higher interest rates and borrowing cost and we continue to have the fiscal drag. none of that is ideal for an economy and for u.s. households that continue to try to gain some footing. now, what is most important is whether we sustain these levels. so just simply jumping there for a brief period of time and then abating is not necessarily going to have a big impact on u.s. economic activity. but if we extend this for some time, because we all know it goes up pretty quickly and seems to take longer to come down, there has to be a drag on u.s. economic activity. >> up like a rocket, down like a feather. you taught me that, john. and how much lower does it go? if you feel like we peaked in
3:17 pm
energy costs here, are we heading back to 90s? >> 93 is where we took off from, bill. working off charts loosely. that's what the down side target is. so it should be a pretty rapid fall. there are a lot of things that oil shrugged off in the past couple of weeks because of the focus on the poipeline and fundamental situation. the strong dollar should have had more effect than it had. that will kick in. and i tell you you look out on the rest of the world and china where you count on that demand growth. we're not getting it. china is slowing. bad data. that's going to also eat into the fundamental story for oil and work those prices lower. >> is there a catalyst you are looking for john that would push prices lower? what does it take? momentum on the side of the bulls here. >> it is. the chart does look strong but again, you can pull back on it and have the double top formation in the works.
3:18 pm
but the catalyst is the overwhelming supply that is coming out of the united states. despite these crazy pipeline. i think we are reaching a tipping point. the amount of oil on the rail system right now is up to 900,000 barrels per day already. i was looking for that to come on-line more towards the end of theier year /* year. the energy department spoke about this today. the demand will be out in the rest of the world and we will be in a very bearish period for a while. >> brian, what would you do with the whole complex right here. >> well, i think that for investors in general, i think the equity markets make a lot more sense than commodities in general to the extent that there is energy companies well position p positioned. what investors need to recognize, i agree with john's comments that the super cycle is
3:19 pm
likely behind us. you are seeing modest demand around the world. no break-out growth around the world and certainly increasing in supply and commodities. what that usually intend is where equities will outperform commodities. >> all right. thank you, both. see what happens. >> see you soon. >> heading toward the close. about 40 minutes left in the trading session with the dow up 160 points. up 175 at the peak. but both the dow and the s&p are in record territory right here. >> microsoft, dow component stopped rallying. the stock has plunged more than 30% since ball mer took the reigns from bill gates. the trade on microsoft, coming next. also, have you seen the controversial cover of "business week"? >> i don't know what to say.
3:20 pm
>> i don't either. >> the hedge fund, measuring up to reality. that's still to come on "closing bell." with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) scottrade. voted "best investment services company."
3:21 pm
♪ [ male announcer ] some things are designed to draw crowds. ♪ ♪ others are designed to leave them behind. ♪ the all-new 2014 lexus is.
3:22 pm
it's your move. welcome back. big day on wall street today. dow within striking distance of all time closing high. microsoft, big part of the blue chip rally today. ceo steve ballmer announcing a reorganization plan. over to you, john. >> yeah, maria, a big reorg with ceo steve ballmer announcing
3:23 pm
restructuring that he hopes will have the company behaving less than a collection of warring thieftons and more like he calls one microsoft. the new structure will have four main engineering divisions. operating systems, app, devices and clouds. but they wouldn't have their own finance departments and p & ls. terry meyerson gets all of windows operating system and key lou who had on-line systems now has microsoft office too. that's a big job. it's been 11 years since microsoft had a restructuring this deep. that's when they went from flat to this system. that system of business units that were vertical. more than a year before we really get a good look into whether this structure is working. two tell-tale signs are the best executives staying and are the new products winning in the marketplace. bill? >> thanks, john. so with the stock near ten-year highs, is it too late to buy into microsoft right now?
3:24 pm
let's talk about it. talking on the technical side, with rich ross, and on the fundamental side, pat dorcy from investment advisors. good to see you both. rich, microsoft was dead money. suddenly hit this decade-long high. is it still a buy at these levels. >> bill, i'll tell you, coming into today's reorg only tell dark paper had more vice presidents with three. i don't know what all those vps do but i know this stock is going higher. when you pull up the daily chart, you see their fifth best in the dow industrials, over 30% with nasdaq composite at 13-year highs. what i like about this stock is textbook pattern and form. not only do we have a strong advance but textbook bull flag or corrective pattern. more importantly continuation pattern. look at the way the stock holds the 50-day moving average. not once but twice on the pull back. i see measured up side to $40 a
3:25 pm
share. but importantly we want to watch that $36 level. let's pull back to a long-term chart. this held for 13 years in 2001 we get a test. '07. now another six years later in 2013, a third test. perhaps third time is the charm. above 36. this is a screaming buy. >> okay, screaming buy. what do you think, pat? >> we were buying microsoft pretty heavily in high 20s. right now we are not adding to our position but beare very comfortable owning it here. if the valuation is quite reasonable at 11 times earnings. the server and business segments are doing quite well despite troubles of windows segment and you are looking at probably a growth of 8 to 9%. in the low 30 s, we are adding and hoping they get increase in mobile which might increase the target. >> rich? >> i have to agree with the fundamentals. technicals are in alignment. i think the stocks are in its
3:26 pm
strongest position and in over a decade you see strong knmomentu in mobile. the cloud is trying to get a make over. easiest way to thin management is to get everyone into upper management. i like the look of this chart. >> pat, for years, during decade when the stock just did nothing and there were lots of calls for ballmer to step down and for someone else to take the reigns, is he still the i go it lead the company? >> that's a very good question. i have not been a steve ballmer fan over time. mainly because microsoft was slow on the allocation front to return capital to shareholders. as you know, they made a number of fairly stupid acquisitions that resulted in multibillion dollar write-offs. so i think that the company, especially ballmer, has been wanting on that front. that said, the dividend is at a reasonable level. 30% ratio with room to go higher han they have slowed acquisition front.
3:27 pm
so perhaps, you are seeing a little bit of a steve ballmer finding out where the clue train board in terms of capital allocation. >> all right. stupid by the way, being a technical term on wall street. >> exactly. >> thank you for joining us. >> in the final stretch here. 30 minutes before the "closing bell." all major averages in record uncharted territory. dow closing here at all-time high. up 173 point on the dow. >> just off highs of the session, as a matter of fact. big banks kicking off. we have jp, wells fargo. downgrading wells fargo i a head of the result. >> yes. one of the most popular dietary is up element on the market leads to an increased risk of cancer. we will hear from that study coming up on "closing bell." i've been doing a few things for a while that i really love-- tdd#: 1-800-345-2550
3:28 pm
playing this and trading. tdd#: 1-800-345-2550 and the better i am at them, the more i enjoy them. tdd#: 1-800-345-2550 so i'm always looking to take them up a notch or two. tdd#: 1-800-345-2550 and schwab really helps me step up my trading. tdd#: 1-800-345-2550 they've now put their most powerful platform, tdd#: 1-800-345-2550 streetsmart edge, in the cloud. tdd#: 1-800-345-2550 so i can use it on the web, where i trade from tdd#: 1-800-345-2550 most of the time. tdd#: 1-800-345-2550 which means i get schwab's most advanced tools tdd#: 1-800-345-2550 on whatever computer i'm on. tdd#: 1-800-345-2550 it's really taken my trading to the next level. tdd#: 1-800-345-2550 i've also got a dedicated team of schwab trading specialists. tdd#: 1-800-345-2550 they helped me set up my platform the way i wanted, tdd#: 1-800-345-2550 from the comfort of my home. tdd#: 1-800-345-2550 and we talked about ideas and strategies, one on one! tdd#: 1-800-345-2550 really gave my trading a boost. tdd#: 1-800-345-2550 all this with no trade minimums. tdd#: 1-800-345-2550 and only $8.95 a trade. tdd#: 1-800-345-2550 after all, i'm in this to win, right? tdd#: 1-800-345-2550 open a schwab account and learn how you can earn up to 300 tdd#: 1-800-345-2550 commission-free online trades for 6 months tdd#: 1-800-345-2550 with qualifying net deposits. tdd#: 1-800-345-2550 call 1-888-254-2600 today. tdd#: 1-800-345-2550
3:29 pm
3:30 pm
welcome back. 170 point on the dow, josh lipton watching the market. which stocks are pushing the
3:31 pm
markets most, josh? >> the market responds, let's run through some of the big movers today. home builders ripping. dr horton, home builders as group remember dropped some 17% between late may and early july. but we have since rebounded about 8%. the miners also working in today's trade. reacting to bernanke. you saw the dollar drop. check out miners, gold fields and wr yamana gold. strategic hotels and resorts, uht and dlr. we end on the banks. we get earnings reports from j.p. morgjp morg morgan and wells fargo. >> downgrading wells fargo, will bank earnings put a damper on this rally? >> scott is with us as well as
3:32 pm
anton shutz. what's behind the downgrade of wells fargo? >> we entered the year recommending about half of the names within the list. so within the second quarter the expectations for the year got a lot more uneven. you had kind of a slow down globally. much more uneven recovery and the big news is shooting up of the long deal. that reintroduced this uncertainty. but in the context of that, banks have hit record highs. we just thought it was -- >> too expensive? >> i wouldn't say far too expensive but approaching fair value. higher rates, good for investment banks. >> this is a very specific movement in the yield curve, right? we get relief on margins because securities portfolio reinvestments rates get relief. having set that, we have a horrifically abrupt refi cycle. that is more than the time it
3:33 pm
takes to benefit margins. >> over the last couple of two weeks, we see more regulation. shifer capital rules. anton, how does that play out? >> i think the fed got ahead of it by trying to put rules in place. that weren't as harsh as brown vitter. and i think that the problem is that we have too many lawyers in d.c. not enough people have an economic background. if you make the banks hold too much capital, i said about 50 times on your show, maria, there is also money for the economy to borrow. . going 5 to 6% is manageable. the industry will fight it but you can handle it. >> i understand what you are saying but reality is the reality. we know what these rules are doing. and whether or not they put banks at a disadvantage is part of the story. but what do you do as investor?
3:34 pm
things are more difficult heading into the earnings. and you want to stay on the side lines. >> obviously, a lot of focus on wells fargo an mortgage and you know, at this point, i have no position in the stock. but clearly, they will have head winds in the future with mortgage. with a well run company and plenty of capital. that's one of the good things about wells fargo. as far as jpmorgan is concerned, this always seems to trade funny. we do own some jpmorgan and i would like it buy more on weakness. from washington, great economic stuff in their sales so i think they are one of the most asset-sensitive banks out there. tons of cash. they can leverage in the loan growth and into higher yielding security and one of the most asset sensitive banks out there. >> scott, we have talked about how unloved this rally has been and you can site all kinds of
3:35 pm
head wind as anton has done there for financials but yet they go higher. as a group they are 20% this year. isn isn't it possible to still good higher? >> we are in the midst of a rally. so having said that, as i suggested earlier, we were recommending about half of the names earlier in the year. i try to recommend them more out of favor. a name like wells fargo which is one of several down grades we have done the past couple of weeks. up 25% plus year to date. just strikes me for a bit of a pause. >> are you expecting a higher dividend at some point even with the capital constraint or no? >> yes. someone like wells fargo is in as good a position as can you hope, thankfully. and under under the new requirements and fdic a couple weeks ago, they come out smelling pretty good. bad news is capital management
3:36 pm
has been outsource ped. so wells fargo included, really takes place in march, once a year. that's when you get a dividend increase. and it goes by the way side. for the next 11 months, unfortunately. >> so we are waiting. >> exactly. >> anton, anything you are buying here in that sector? >> sure. i mean i like some of the boyers. and i think scott would agree, that you know, some buyers can add value at this point to their franchise, to their shareholders. so home bank, homb, scbt who has done great for shareholders. i like regions and i think they've got a lot of very good things noing on for those frn chiezs and think think they will get the hudson city deal done and i think that's a real boom out there. >> good to see you both. >> thank you. >> thank you so much, guys. >> by the way, jpmorgan chase, jamie dimon will break down the results on squawk on the street
3:37 pm
tomorrow beginning at 10:00 a.m. eastern time. look forward to that mp meantime, heading toward the close with about 25 minutes left in the trading session. dow and s&p both in record territory right now. >> and fed terms, investors really liking what ben bernanke today say last night. coming up, find out if it is full steam ahead for the markets. >> also, just 52% of americans own stocks right now. that's down from 67% back in 2002. when we come back, we will look at whether individual investors have permanently lost their taste for wall street. coming up. [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room.
3:38 pm
[ static warbles ] [ telephone ringing ] now a waiting room is just a room. wi drive a ford fusion. who is healthier, you or your car? i would say my car. probably the car. cause as you get older you start breaking down. i love my car. i want to take care of it. i have a bad wheel - i must say. my car is running quite well. keep your car healthy with the works. $29.95 or less after $10 mail-in rebate at your participating ford dealer. so you gotta take care of yourself? yes you do. you gotta take care of your baby? oh yeah! you know it even after all these years. but your erectile dysfunction - you know,that could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about all your medical conditions and medications, and ask if your heart is healthy enough for sexual activity. do not take cialis if you take nitrates for chest pain,
3:39 pm
as this may cause an unsafe drop in blood pressure. do not drink alcohol in excess with cialis. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, seek immediate medical help for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or if you have any allergic reactions such as rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a 30-tablet free trial.
3:40 pm
welcome back. rally day on wall street started with the bernanke speech last night where he said the fed will be accommodative for the foreseeable future on the economy until they feel the economy is sustainable in terms of growth. >> you know my favorite part of bernanke's talk last night is when he said that unemployment rate is actually underestimating the unemployment estimation. it is a lot worse than 7.6% of the country unemployed. i think that said it all. >> exactly. >> right there you know bernanke is looking at an economy in a slow anemic state and that means
3:41 pm
they won't start tapering until we see real moves on unemployment and we haven't seen it yet. >> so the dow in record territory. s&p record territory. russell 2000 again record territory. nasdaq at 13-year high. even though yields on the treasury -- long end of the yield curve are high are than they were the last time we hit all-time highs. >> i think this also, bill, is about earnings. here we are in the very beginning of an earnings period. yes we are only expected to see profit growth of 3.5%. some people at 6%. going in the bank earnings tomorrow, there is optimists. partly bernanke and partly o optimism over markets. >> okay i get that you want buzz. i get that you have to distinguish yourself in a a crowded market. but really, "business week"? really? this magazine will be put next to "time" magazine in every
3:42 pm
airport in the country. >> yeah. >> and it'll be seen by everybody. >> oh, yeah. >> is that -- i wonder what steve shepherd who ran "business week" for so many years is thinking right now. he stepped down in 2005. it boggles the mind. >> yeah. it really does. and basically the the point of that is saying hedge fund managers think they are doing well. >> that's been the joke for years. >> they are not doing so well. >> hedge fund managers describe themselves with a few word that include big and swinging, right? so they are playing to that joke. but that's a joke that belongs in the back room, not on the cover of a national magazine put in public display. i'm sorry. >> well, they wanted the buzz, we showed it. >> you got our buzz but not our respect. sorry. doesn't work. doesn't work. >> 15 minutes before close. we got the market at highs of the day. we are in unchart eted territory.
3:43 pm
up 15,465 on the dow. >> and heather hughes sees a lot of opportunity in what she called teddy bear stocks. no, she is not talking about build a bear. she will explain when we come back. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: scottrade- proud to be ranked "best overall client experience."
3:44 pm
vietnam in 1972. [ all ] fort benning, georgia in 1999. [ male announcer ] usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection and because usaa's commitment to serve military members, veterans, and their families is without equal. begin your legacy, get an auto insurance quote. usaa. we know what it means to serve.
3:45 pm
3:46 pm
10 minutes before the close p.m. look at that. we're at not only all-time highs but the highs of the day. big time. up 23, 24 points. as i said earlier, if this is a short squeeze as some triggers on the field, what a -- just getting killed today. >> they are. to break it all down, heather hughes. steve sacks, good to see you both. steve, let me kick it off with you. bernanke had something to do with it last night with the bullish tone but what is your take on earnings as we enter reports tomorrow with j.p. morgan among other banks? >> there are reports. and earning season is not all different from the first quarter. it is about top line revenue growth. we have had a lot of
3:47 pm
reservation. a friend of mine said, it is like a bad movie. everything will work out well in the end but i think we will focus on top line earnings growth rather than bottom line. >> by the way, looking to the upside, not by a lot but 85% of it was to the buy side. >> yeah, half a billion dollars also. >> exactly. heather, you still like this market. even at lot offy levefty levels it. you are going after teddy bears stocks. >> well, you can call it pillow stocks or blanky. >> comfort. >> yes, comfort so you can sleep at night. the buy mentality advisers i work with are telling me still you want to look to the growers, not necessary lit yielders. so you want to sleep at night better be safe than sorry.
3:48 pm
>> where are you seeing the influence, steve? in terms of new money coming into the market. >> couple areas. one is fixed income hedging. not only that we have been talking to clients but but clients have come to us on. >> as well as hedge high yield. we have -- a lot of conversations and new high hedge yield product. that's the mine focus. but to heather's point, people are cautious. they want to commit more money. they want to do it in a more cautious fashion. >> doesn't feel so cautious today. >> it doesn't. but if you look at sectors outperforming and underperforming, there is still money flowing into the spaces. >> someone is pressing buttons. it is not me. i don't know who but someone is. short squeeze, as you say.
3:49 pm
>> yields, as we have been pointing out, last time we were at all-time highs was may. yields were high are than today. either we are becoming very comfortable at these levels or shorts are getting squeezed out. >> definitely. still cautious or as bond yields i know we have caught a bit after bernanke's comment yesterday. but as they rise, if you think about where they should be in terms of buying normalizing, gdp or gross domestic product plus inflation, that's the nominal growth rate. that should be 3.5 right now. they are making it lower before they head higher. >> any areas you want to avoid heather? >> defensive on duration. i think bonds in the fixed income markets are even though we caught a bit over the short term, you can look for some support maybe around that 2, 3, 10 year or 2.2 on 10 years but in the long run -- >> sticking with equities?
3:50 pm
>> yeah. we hear that dollar will good higher? we have so many analysts go through here so bullish on the dollar. the dollar in the last two days had its worst two-day period in four years. a lot of that attributable to the fed minutes and bernanke speaking and all that because they will keep rates low. why go into the dollar issues, right? >> yeah, two things that drive currency and gdp growth and differential and we have confusion in the last 48 hours about what is the interest rate differential going to be in the u.s. relative to other countries. but the growth story in the u.s. relative to the rest of the world, it is tough to argue with right now. i think it is a short term effect on the dollar verse us a change in the long-term trend. >> what changes this story? what gets you both to say, i need to get out of equities. >> good ahead, you first. >> oh, geez, wow. again, so i mean, we saw it for the past month and a half, rates rose. today they caught it because of bernanke. it looks like the bond market
3:51 pm
starts to take higher. you see signs of inflation with 1.1. you are not currently seeing that but whoa, not a let's exit and be polite ladies first. no. it is a stampede. and that could effect the equity markets as well. >> certainly not arguing with that. and one of the things that probably gives us head winds is like we talked about with earnings. if we don't see revenue growth in the back half of thei year ad we see it where we are now, that's one of the other major head wind to equities along with what heather said. >> all right. good to see you both. >> thank you. >> appreciate it. >> we will head towards the close with a countdown. market again, bias to the upside by a smidge but we are in record territory. art cash standing there letting us know. >> and coming up after the bell, get ready for some post july 4th fireworks. ron says this market has nowhere to go but up but harry dent says get ready for a crash. that's when he is using that word. that's ahead later on --
3:52 pm
>> and a hundred against harry again. >> yeah. >> by the way, join me and harry tonight. we will be hosting a special coverage of this historic rally. that will be getting under at 7:00 who are on cnbc. you're watching cnbc first in business worldwide.
3:53 pm
3:54 pm
[ indistinct shouting ] ♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪ coming up in the last five
3:55 pm
minutes, i didn't know why we are surprised at how strong the market is. it has been surprising us all year. every time we turn around, we say, gee, it is almost over. can't last forever. and then it goes higher again. >> i was skeptical of the whole negativity over the beginning of the tapering. the economy, we know the markers the fed are using. direct 7.6%. how we get to 6% by september is a mystery. i mean, that alone is one reason to say, okay, i think this market got it wrong. >> as long as feds in this were going higher, i guess. these are all-time highs for the dow and s&p. anything above 15,409 and anything above 1669 for those two averages so we will do that easily and the nasdaq is at a 13-year high going back to october of 2013. as for the intraday, showing you the dow, right off the open, the interest here, keith bliss's comment on this. but you know, the rally on the
3:56 pm
open this morning, side ways, then kind of moving higher into the close here with a gain of 177 points. and as we have been pointing out, the last time we were at all-time highs was may 28th when yields on 10-year were lower than today. now it made a liar out of me. ways going to say above 2.6% but now down to 2.57%. tomorrow morning, two important earnings report before the open. we will hear from jpmorgan chase and jamie dimon will be on the squawk at 10:00 a.m. to outline numbers for us. keith bliss, is this real buying or a short squeeze today. >> this is real buying. bulls are taking control. as we talked about last week, filled had gap from june 24 on the spider and we got above that. once you get above that, you have a bullish posture inside right now. there is a lot of momentum built in. volumes are high are than behave seen with a down draft of the slow melt up. the bulls are taking control and
3:57 pm
this could sustain itself for quite a while now. >> where are you seeing the most conviction in terms of buyers consistn'tly there. >> across all segments. we had a couple of good signs a couple of sessions ago. with small caps and more discretionary names closed above their all-time highs they setback in may. once you get that momentum built into the market and just a spiralling effect, taking across the entire marketplace. what i wouldn't do now is we are getting up to lofty levels and people say this market is overbought. >> we have been hearing that for a while. >> we have been. but every time a fed opens their mouth we go higher. you may not want to get in but i absolutely would not short the market. there is doom ahead if you do that. >> that is trading at about 14 times earnings. what are you expecting earnings period to look like? >> if you look at inflation adjusted piece, we are at an
3:58 pm
overbought level already. we have been for some time. i think the the earnings picture is what the analyst are predicting. fairly tepid. what i'm looking for in earnings period is what the earnings sales from companies coming out. i don't think that will have much of an impact. we are expecting a tepid earnings corner. even if they are not break out sales numbers an they have their back stop on this market, it will move higher. >> is that good or bad for financials? tomorrow jpmorgan chase, wells fargo, what are your expectations there? >> financials do well in a steep yield curved environment. it has been moving that way for some time. it scares people because they think lending will somehow come to a halt. remember, even when interest rates are at historic lows, so banks borrow at shorter end of the curve, they need that spread to be as woide as possible.
3:59 pm
lending activity will be there and they will make more money on the spread. >> i will head back for a 4:00 show. good to talk with you. see you tonight at 7:00 for our special coverage. >> yeah, we have that going here. >> even at levels here, we still only have about 5% pull back last month in the markets. was that enough? are we -- can we move higher from here even still? >> we can move higher from here. next few sessions are very telling about what we want to do. we need to maintain the bullish moss tour. but if we stay above what was pretty strong resistance at 1655 today, if we stay above there, we will go back and retest the all-time high which is 1687. we will hit the all time closing high as you said we will do that today. next stop is 1687. we get through there and mark set set to go 1700 and we good higher from there. >> amazing. >> the word came out of both of our mouths at the same time. salt and pepper. so once again, in a year when
4:00 pm
we've had so many historic days, the dow and s&p finishing at all-time highs, so is the rest of 2000 again, by the way. and the nasdaq at a 13-year high. see you tonight with maria on our special at 7:00 p.m. eastern time. in the meantime, here is the second hour of the "closing bell" with mari with maria. >> closing at a new all-time high. good evening, welcome back to the "closing bell." we are looking at all-time high for averages in uncharted territory. at 4:00 today, dow jones jumping 170 points, better than 1%. at 15,461, the all time closing high for the dow industrial. s&p 500 up

110 Views

info Stream Only

Uploaded by TV Archive on