it is one of like a lot of experimentation. >> what would you say your work is about? >> lots of things. ideas," powered by hyundai motor. alix: we are moments away from the closing bell. i am alix steel. joe: i'm joe weisenthal. alix: that is some serious cheering. u.s. stocks seeing the best gain in days after the worst rout in years. joe: the big search -- stocks soar after global market turmoil. we will ask what is next. alix: plus, the china factor. we take a deep dive into power

consumption and what it means for the markets. joe: and the kingdom -- we look inside saudi arabia, crucially important country grappling with an oil glut. alix: we have to begin with these markets. it was -- is an historic day on wall street, the doubt jumping 600 37 points off the session high. sincee s&p, biggest gain november 2011. joe: absolutely extraordinary day. first half felt like yesterday when we had a big pop and then the markets were selling off and everybody had a feeling we were going right. extraordinary buying in the afternoon and it took off late in the day. great economic data this morning. pretty positive day. the: dow finishing with third-best gain on the record. you saw all of the sectors higher.

tech accounting for 38 points. joe: as with yesterday, the cyclicals leading the way, and you cannot forget the fed's dudley basically taking september off the table for rate hikes. traders were probably excited to hear that was not going to happen. more time toey, buy stocks. like leading the tea leaves as we were just talking about. i will take a deep dive into my bloomberg terminal and look at china. what you are looking at is china's electricity and total energy consumption. the reason i'm talking about this is i want to use it to measure growth. yes, of course, it is seasonal. there are seasonal patterns. but the economy is growing. people are moving. they are using energy. this would imply that china isn't in hard landings kind of situation. joe: for a long time electricity

consumption is one of the dominant metrics that people use to gauge the chinese economy. officials have questions about transparency. we aree bank noted seeing solid gains in energy, electricity consumption. maybe the economy is in falling as bad -- is not telling us -- alix: he says what we are seeing his worries about violation and liquidity in the market. joe: absolutely. i want to look at my terminal. speaking of china, obviously, there's a lot of question about their peg. the traders are searching for pegs wherever they look. this line is the implied volatility over the next year of the hong kong dollar. the yellow line is saudi arabia, the reality as you can see, surge ina big options-implied expected volatility. people are thinking that the economic pressures, the slowdowns, is going to force

these countries with long-standing pegs to loosen or we can in some way. a lot of people think there is no inclination but traders think there is a possibility. alix: kazakhstan did it just last week. joe: presumably a little more stable than kazakhstan, but absolutely, you never know. presumably. alix: i want to bring on our guest. we have an analyst at the spoke investment group, and the global cohead of asset allocation at red needle investments, who join us now from london. thank you for staying up with us . we really appreciate it. what is your take on the rally today? is it sustainable or are we looking at another dead cat bounce? >> i don't know if dead cat bounce is the way to characterize it. predicting the short-term movements is really hard to do. it is nice that we saw solid rally to the end of the day. the last two days, not only with the opening props, but also the

inability of cash equities in the united states to find buyers late in the day, demand kept petering out, petering out. nice to see buyers at the end of the day, a better sign then nine. but it is not something where you can look at a chart. it is a wildcard market. bigger picture than what happened in the last couple days. you have done a lot of work looking at market valuations. what can we think about going forward in terms of where the market is valued? well, the market, after it has fallen so far, you think there has got to be some value there. but deteriorating fundamentals and improving valuations of a variety of different asset classes -- you mentioned that the u.s. high-yield earlier has risen by a couple hundred basis points. equities are playing catch-up now. it is a function of the oil -- whichich is hit the

has hit the energy company's and a function of deteriorating markets. and the u.s. companies are doing just fine, which means you can start to think about fed hikes coming through. all this makes for a slightly confusing valuation picture for the u.s. stock market and but certainly it is nice to see stability in the market. that wind upoes meeting you are paying for earnings that aren't amazing? pretty muchthat is right. at the global level, earnings are lower than they were three years ago. that is a huge valuation rally we have come through. we have come 10% off that now. in the u.s. come earnings have been gradually improving but you have been paying a lot more for the same earnings you have been expecting to come through. there is a lot of evaluation that has come through. the market is where it should be in the context of other asset markets like high-yields, emerging-market debt, international equities.

there are really good opportunities out there, but even though there has been a sharp drawdown, let's not go screamingly buy the markets. we have a better opportunity to buy holding back from purchasing. it. joe: you look at similar stuff and how it compares to high yields. apparentmake of the closure of the cap we've seen in recent days? george: it is important to sort out what is going on in the credit and equity markets. it has been very similar in both the energy has looked so much weaker than everything else. we did a study last week were elected increase in spread for -- where we look at an increase in spread for credit default swaps. up until last wednesday it was a most entirely due to commodity-based names. if we can find a true bottom in crude oil and move sideways, that will have significant impacts on the credit markets

and also for the equity markets. i think there is a lot of moving pieces. it is absolutely right in saying that there is not a screaming by on valuation terms. there are things that are really attractive individual names. depending on risk tolerance, some investors may not very well this week. alix: we have got to get to what we like. toby, you like japan. toby: i do like japan. it has been a great story. in most developed markets you are paying more and more for the same earnings or slightly improved earnings. in japan, you have seen earnings almost double over the past two years with valuation harley moving. usc great rallies come through the market but you are paying more for the same earnings. the quality of the earnings has improved. there has been help coming to the market and we think that pe for a bigrket ri move up in terms of how you evaluate price-to-book and other such metrics.

one thing we have been doing over recent days with the sharp declines is adding more to japan. joe: what do you make of u.s. equities at this point, in terms of the global look? does the u.s. compelling at this point? toby: well, the u.s. is a quality market and has a decent level of earnings but you have high levels of margins and it will be hard to improve margins when, actually, there's a lot of tightness through the labor market and a stronger dollar. overseas earnings are going to be worth less dollars because you have had a big move up in the dollar and the cost base might be a little bit challenging going forward. there is a great study from the new york fed today about wage pressure coming through and the output gap shrinking. those sorts of things make us nervous about market expansion from here. the earnings environment will be relatively unexciting. doesn't mean the u.s. economy is is it worth, but

the premium you are paying versus pretty much everywhere else in the world? we are not sure it is. joe: build of the spoke about the turmoil going forward. for my perspective, it is less compelling to me than it was a few weeks ago. but normalization could become more compelling by the time of the meeting. have been onyou twitter saying that the fed should just do it, hike rates already. alix: my cabdriver said that to me today, by the way. kind ofthat is some contrarian indicator when a cap drivers talking about the fed funds rate. an inspiration from ed bradford, who you know. he said it to just go for it. there is so much about the economy that signals straight up of boom conditions. if you look at the services revenue, the net percentage of

companies in the richmond fed district that are reporting above average revenues, it is like the percentage of 30 firms clearing an all-time high. looking at these charts yesterday and seeing that there is so much about the economy that is extraordinarily healthy and just being ignored, the fed should just do it. they really should. nike thing -- fed, just do it. to: all right, thanks toby, and george, you are staying with us to the break. which is best for investors since china devalued the yuan? that answer after the break. ♪

alix: i'm alix steel.

joe: and i'm joe weisenthal. alix: we talked about which country provided the best refuge for mr. since china devalue its currency to weeks ago. joe: the answer is:. : -- the answer is poland. poland leading the way. there is talk about the eastern european emerging markets as being separate from the emerging-market rout. india doesn't have as many of the characters to us as others. even within the carnage there is these pockets. alix: particularly with poland, it doesn't have that much exposure to china and that insulates it from the gyrations we see with the yuan. there is a high risk that poland may be forced to reduce borrowing costs that that is a knockoff if the ecb has to keep money in the system because of china.

we want to get straight to top headlines in the afternoon. a gunman suspected of killing a reporter and cameraman during a live tv broadcast has died. virginia state police say the disgruntledant as a former employee of wdbj-tv in virginia, died of a self inflicted gunshot wound following a highway pursued. he later died at a hospital. the general manager identified the victims as alison parker and adam ward. parker was interviewing and economic of element official when the violence occurred. that official was also hit by gunfire and is in stable condition after surgery. joe: in colorado today, sentence of life in prison for convicted killer james holmes. he fatally shot 12 people and injured 70 others at a number movie theater in 2012. jurors rejected his insanity plea but could not agree on the death penalty. alix: walmart says it will stop selling military-style weapons like the ar-15 rifle this fall

but the company says the move is not rooted in politics. the coveney says that customer demand for the controversial firearms is declining. it plans to replace the firearms with other types of rifles like shotguns and other hunting merchandise. george fromth us is bespoke investment group. no doubt today got a lot of attention from hugely popular on the terminal. he looked at the extent -- you look at the extent of abruptness and noted that we have not seen anything like it in 75 years. explain how you measure did and what it tells us. have nothe markets been this oversold relative to the trent on a three-day closing bases since the outbreak of world war ii. i think we are going to show a chart here. this shows the sum of the last three days greeting for reading that we like to use that shows the standard deviations below the 50-day moving average.

the civil excavation is it is a summary of how oversold the market is. by that measure, we have not been this oversold since there were german tanks rolling into france in 1940. alix: first of all, can we define standard deviation? george: sure. his standard deviation of normal this division is a move that should happen in either direction 60-70% of the time. 68% of all readings on something should take place within one standard deviation of the mean reading. on a normal this tradition. that is the statistical definition. joe: basically, when you see the charts of the market falling straight out -- it is one thing to have a cellar for you are creaking lower paid what this really tells us is how extraordinary it is to go straight vertically down, just slice through the moving averages and put them in the rearview mirror. george: exactly, and the other thing that gave us the extreme reading his we were so range bound up to the point we sold off vertically.

that creates a more extreme reading. in terms of the percentage drop, believe, one, i third as much as we ended up selling off in 1940. but similar standard deviation because we were so much more range-bound prior. alix: this is the chart measuring the s&p for the same read we saw in 1940 and what we see, a bounce, because of selloff near is each other. and you explain what this means? george: that is the overlay of the two different periods. six months on either side of that day, we got an extreme oversold reading. on the right-hand, the darker purple line, that is the current s&p 500 price chart. there is an overlay there. our reading on this was not that it was necessarily guaranteeing what the future returns were going to do, but we did think it was instructive that the price action on the s&p 500 looks like it did at the end of a world war. that is significant.

it has been damaging. i think that is the read there and not necessarily that prices in the future are going to follow that chart exactly. it was more to show the severity and intensity of the selloff and how historically relevant it is in the long run. joe: all right, fascinating. alix: awesome. i had to have a chart explained to me for like an hour before i got on the air. joe: the volatility in the markets may not be the only thing to be worried about. an indicator showing signs of stress in the u.s. economy, up next. ♪

alix: i'm alix steel. joe: and i'm joe weisenthal. what'd you miss? alix: volatility in global

markets is clear but there may be a need to worry about the u.s. economy. joe: the chemical industry is slowing and that is not a good sign for the future of industrial output. the gauge the chemical industry has -- there is all these tiny economic in the we all must never talk about, like the talking industry has their own measure and the architecture building index we should probably talk about more, but we don't. and the chemical industry has its own chemical activity and it has been rolling over, and it is a sign that perhaps industrial activity is not as good as we hope. alix: it precedes a drop in industrial output and the slowing of pace the last three years. so watch it. obviously, guys, and historic day in the markets. u.s. stocks rallying the most since 2011. joining us to rounded out his bloomberg's mike regan as well as julie hyman. with ai want to start huge, huge move are there, seeing the best day ever for the

s&p tech index in the last six years. julie: that's right, biggest one-day gain of the past few years, and it makes sense that tech would lead us today could particularly when you look at the individual movers like netflix, like apple, for example. here you have the major averages. heavier weight in the nasdaq then in the dow. but the pointing is the third-largest ever on a point basis, not on a percentage basis. the thing i keep coming back to today is the trajectory of stocks throughout the day. this was on the bloomberg terminal, the three-a chart of the s&p 500 tick by tick. yesterday we had the rally but blew up in the last half hour of trading and you have the opposite effect as we watch today with most of the gains coming in the last hour or so of trading. really a very different day then we had yesterday, and as we have been talking about, this is something that mike regan was

talking about also, it has been very difficult to predict where things are going next. what you make of this extraordinary action and what are the things you are taking way from the last couple of days? mike: i thought you were going to talk about mohair for a minute there, too. joe: do we have the mohair prices? alix: there is mohair pricing? what i keep thinking about, joe, with this turmoil is i cannot wait to read the hedge fund letters for august and find out who the winners and losers are. obviously one of the big whines you hear on wall street is that trading volume is to an old over the years. obvious the, stock prices keep going up and up. you might be trading the same dollar amount of stocks but the share volume goes down. that is not great for the colonies that actually make money off the volume -- your exchanges, clearing firms, that sort of thing. now if you look at a chart of volume -- alix: which i have on my

terminal. mike: look at the spike on the right. traded billion shares yesterday. over 10 billion shares traded today. that is blockbuster trading numbers that are going to be good for a lot of companies -- schwabs of the world. whenever there is these market dislocations, there is always rumors and chatter about hedge funds blowing up. haven't heard a lot of that this time, but it wouldn't surprise me if you start hearing that. interesting to see who is capitalizing on this, who the winners are at the end of august. alix: absolutely. mike: especially if they were on mohair. alix: which we will talk about. julie, what is the number one thing you will be looking for when you get up? julie: oh, jeez, i don't know. i think i will just wake up and see where the wind is blowing.

picking up on what mike was saying about hedge funds, something that erik schatzker brought up this one i thought was interesting, also look at the big bond funds and see how they have been performing recently. and doubling capital has been an outperform or the past month, picking up .75%. the unconstrained bond fund is down about 3.7%. i pulled out the chart of the past year on my bloomberg terminal. janis is a find it now managed by bill gross. fund now managed by bill gross. you can see it is not done too well lately. there are folks who have held up better in this environment. alix: good stuff. thanks guys, for recapping this crazy last four days in the market. joe: we will be right back.

alix: i am alix steel. do not miss earnings out tomorrow. inside my bloomberg terminal for the one thing you need to know thehat sales are in asia-pacific region. joe: another thing you don't want to miss, jobless claims. i like this because it is a high-frequency economic data point, every week. it is sensitive. if the economy is starting to

deteriorate, we might see it there first, because we get it so frequently. something to watch. alix: have a wonderful weekend. it has bee ♪

♪ in new yorkstudios city, this is "charlie rose." charlie: misty copeland is here. last month, she became the first african-american woman to be named principal dancer of the american ballet theater in its 75-year history. the news came a few days after her new york debut in "swan lake." she began her ballet training at the unusually late age of 13. in two decades, she overcame numerous obstacles to become a rare pop culture celebrity. here's a look at her recent profile on cbs