>> not at all. chinese market? think about this, the mutual funds have done one thing. let's trade the globe. they entered this market at 870, cnbc asia's amanda drury joins they chased it basically all the way up. us on set to help us with this trade. it's not that they're dumb so, is it true, can the u.s. money, but they did chase a little bit here. recover without china in any way? so, i think they want to wait at this point. >> chasing sounds to me like >> well, i think it's going to dumb money in this rally. be very hard for you boys to get joe what do you say about a grip on this, but actually, today's reaction? all roads do not lead to wall street. >> i think it's an extension of increasingly, yes -- yesterday. we talked about it yesterday, >> what is that? this is going to be what the i can't believe what i'm market is. what you've seen from march hearing! >> she speaks in tongues. until now is a straight rally >> i'm speaking australian. higher. anyway, let me explain it in english. that's not how markets work. how markets work is they find support, they find resistance. increasingly, it seems as if all roads are leading to and from go back to june. shanghai, because obviously, june, 955 on the s&p. economic power is gradually also that was your resistance level. that now becomes support in the shifting over to the east, and the crisis has sped this up, marketplace. right? over head, you now know what people are now arguing, if you resistance is. look over the last two years, resistance is 1010 to 1015 in the shanghai market has actually the s&p. been quite a reliable global so we are going to play the game indicator, a leading indicator as to what's going to happen of she loves me, she loves me not. with worldwide stocks. >> stock market as opposed to it's going to be a tough market. the economy. it's going to be a very >> absolutely. stock market. illogical market, but at the end >> even though it's an immature of the day, melissa, it's going market that doesn't have a lot to be a stock-picking market. of the efficiencies -- >> even though it's an immature market that doesn't quite function exactly the same way as >> they always love me not, so i don't want to play that game. say the market here.

for daytime watchers, steve for example, let's flip back and grasso's always been spot on in this market, steadfast, saying take a look at the summer of 2007. we saw some sharp falls in the it's going higher and it has. chinese market, and that was a i'm going to deviate a bit. precursor to the start of the freezing up of the credit i still think we go to 970 s&p, market. at the beginning of this year, break 970, trade 905 within a week. which was one of the markets i just don't see -- i've been that decided to pull out ahead saying it again, i don't see the of the others? next catalyst. the chinese market. and now, since the beginning of hewlett-packard earnings we're going to talk about in a second. i don't know if that will get us this month, we've seen a over the top. correction in the chinese market of about 16% off its year highs, tomorrow is going to be a very interesting day. and now it's starting to see >> would we have been better off if we pulled back more, if we some shakiness in the market as well. didn't shoot back to the up side >> amanda, i completely agree with you on china. today and instead digested the i think china definitely leads. decline of the past couple trade it was a stabilizing force in sessions? the quarter, but in terms of >> i think that's difficult to investing and actually trading, ascertain that but i think when the play has actually been to go you look at that, once again, back to the volatility, down under. everybody calls it fear. i'll take you down under on this one. it's not fear, it's a measure of >> i'll happily go down under with you. movement, it's expectation. >> oh. the expectation is real, the >> oh, my god! expectation is being warranted wrong, wrong, wrong, wrong. at these levels, so don't look at the volatility index right i was thinking -- i will always now as fear. when we get over 30, we start getting to 50 and 80, that's -- my homeland. >> i know, absolutely. fear. but let's talk about the right now we're looking at the australian currency. volatility index measuring >> good thing we're not live. expected movement. we're getting the ranges that you talked about, the support, >> guy's falling apart here. he's crying. resistance, all of the various levels. >> let's also talk about the

that's the market we've got. >> guy brings up an excellent australian equities market, which has been one of the top point -- if we break down below performers this year. and here domestically, the 970, we're going to 905. ambassador loves. i think 950 is the almighty level that everyone's looking at. if we break that, look out i know that i've tried to get below. >> we're kind of far from that investment in. you still believe the australian right now. >> we're far from that, but dollar, the australian currency we're also far from where we are was basically benefits giving china what it needed. when we started at 870. is that still the play? it's all relative, right? >> absolutely. well, i was talking about this we did that in a number of just yesterday with erin. the fact is, there's quite a sessions, marked up. close correlation to the and on the way down, we did that shanghai stock market and the in two days, right? when we collapsed, nobody australian dollar. worried how fast we did that. and it's no coincidence, because >> don't get complacent out there. obviously it's a commodity currency. >> and also understand that 2009 is not going to be a normal year. who gobbles upmost of the world commodities? look at the recovery that you who makes most of the have had from march, from the commodities? australia ships most of our lows of 670 back in march all commodities over to china, they have an insatiable appetite for the way up to 1010. it. so, when the shanghai economy or this is not going to be a normal stock market shows any kind of year, so what's the best thing right now, the best scenario? again, it's to focus on jitters, we also see the australian dollar show jitters companies, focus on good balance as well. sheets and focus eventually from and an excellent example of this was, i was covering the aussie the shift from bottom lines to markets last week and we got top lines in performance, and some great data at home, the those are stock names you want to go with. the remainder of the year is not aussie dollar shot up and then going to be as easy as it has been -- >> though, as guy said, we're the shanghai market moved down past the earnings season, so

where's the catalyst? and the australian dollar moved down as well. congress is out on break, we're past earnings season. >> if you want to hear it, you want to hear it in that face right there. >> how much longer are you here what are we looking at now? for? >> three weeks. >> glad to have you on "fast." >> thank you. >> the shift from bottom-line performance into top-line performance -- united, signa, wellpoint all >> we're not going to do that on a day-to-day basis -- up on the week in hopes that >> that's a touchy catalyst obama's option will be dead on because we don't know when that will come. arrival, but the options market isn't sure. that could come in guidance or options action trader brian in terms of the next earnings season. >> i hate to do too much obama bashing. studland hashes it out. as long as we have health care, welcome to the now network. population: 49 million. energy's on the back burner, the market's going to move higher. as long as we see somebody's there on the other side of the political world, i think markets like that. right now 1.2 million people are on sprint mobile broadband. >> moving on to after-hours action. 31 are streaming a sales conference from the road. hewlett-packard out with its earnings, the last dow component eight are wearing bathrobes. two... less. to do so in this earnings season. - 154 people are tracking shipments on a train. - ( train whistles ) 33 are im'ing on a ferry. beat eps as well as revenue. let's go to james goldman, our and 1300 are secretly checking email... silicon valley bureau chief, for a breakdown of the numbers. - on a vacation. - hmm? ( groans ) >> melissa, this conference call is just getting under way just that's happening now. america's most dependable 3g network. seconds ago. mark hurd, the company's ceo, is bringing you the first and only wireless 4g network. sprint. the now network. just beginning his prepared comments. he does say that through the deaf, hard of hearing and people with speech disabilities access www.sprintrelay.com. third quarter business did continue to stabilize. you mentioned that eps and

revenue beat, but let's talk about a couple key factors here, because these are significant. in enterprise, storage and servers, the company reported $3.7 billion. that's about $300 million more in revenue than what the street was anticipating and a pretty good indicator now that some of its key enterprise customers are opening up the checkbook, at least through the third quarter. another thing to keep in mind here, that the services business reported $8.5 billion in revenue versus the $8.4 billion that we saw in personal systems group. that's the home of hp's personal computer division. this is the second quarter in a row now where services have eclipsed what has historically always been hp's bread and butter in computers, and this is the one-year anniversary of the eds deal closing. so we are seeing the fruits of that now really beginning to materialize for this company. mark hurd has also mentioned that china enjoyed double-digit growth during the quarter. that was also a pretty big success story for the company. then as far as guidance is concerned, hp, $1.12 versus

$1.07 that some on the street were looking for. so a nickel or share better on, well, the revenue's maybe lighter than some people would have liked for the shopping quarter. up about 8% is what hp is projecting, though some on the street are saying they were looking for 10% growth. nonetheless, this is still considered very good, especially in the current economic climate, and we are seeing hp shares give up a little bit of the rally. but remember, these shares are up 15 days in a row. so you have to expect some of this in the activity here. >> jimmy, i don't know if you know the answer but i'll ask anyway. in terms of china, they made a big deal about the double-digit revenue growth, what percentage of their overall business now is coming from china? >> i'd have to check on that, guy, but we do know that more -- the company's business overseas is more than half revenue now at hp, and china is the fastest growing region that hp is tracking outside of the united states. so, clearly, i'll get you that overall figure, but clearly, china is not just important for

the company on a country basis, but china is basically guiding all of hp's asia business, and that is the rising tide that hp is pointing to as floating its key boats, especially on the enterprise. >> jim, got to say good-bye for now, but there was a reuters report out there saying that hp would perhaps close or sell off part of its outsourcing time for some options business. action. if you can kind of listen in for recent polls show president that, that would be great for us. obama's plans to reform health >> absolutely. >> great. care is cooling, which in turn jim goldman. don't forget, he is monitoring has stocks heating up. that conference call for us but could the gains be right now. short-lived? you can follow him on twitter. for a look at this opportunity, our page is twitter.com/cnbcfastmoney. brian sutland is joining us, see him there active, under way, joe. president of sutland equities as well as an options actions trader. >> because i love guy, she loves brian, what are you seeing in me, she loves me not. the space? >> one thing that's popped up on i love you. >> that's really sweet. my radar recently is united health care. a lot of options activity going >> the bric nations make up 10% on in there, call-buying, of hewlett-packard's revenue. playing both the short-term buy 62% of hewlett-packard's revenue come from overseas. for the upside in united health the bottom line here is care and a longer term. what you see is january call buying. what does that mean? hewlett-packard right now trades at $45. option traders are predicting that possibly the obama plan, in do you believe that the trade is that hewlett-packard can sustain terms of a public plan, could be above $45? a dead topic. they're planning on getting in, if you believe so, then you stay

with the longs or you get long saying the private sector is here. that's the story. still going to be around, still going to be a major player. it's all about the trade in hewlett-packard. do you stay with it ahead of united health care is a major hewlett-packard? player in health insurance, and there's an analyst day on it seems like for the long term, september 24th. at least through january, there that could be positive for the stock, but it's all about where will be a move to the up side for those. >> only unh or also the other it is right now and where you think it's going. names? >> it's also about the record services profits. we talked about the eds >> actually, what i'm seeing, too, a little bit is volatility acquisition that was a huge rising. what does that mean? options traders predicting acquisition, already starting to pay off, but the cash flow, $3.9 you'll get some sizable moves coming up over the billion? next 30 days to couple months i love that going to the bottom out. not just united health care. line as well. these numbers are incredible for you're looking at the select hewlett-packard. sector, xlv is a name, cardinal you've got to love the numbers, health, options players playing but the run into this number was that area, too. also incredible. the last quarter, they have so definitely some movement. even though it's not moving out-stripped the xlk, the only around a lot right now. stock that has actually kept up with them in the xlk has been apple. this has been a stock that's we could see movement. >> and other names, signa, wael been on fire. expecting it to go much higher point, people are betting on the same thing and they figure every one of these could profit. would be ludicrous at this and they're rolling the dice, using the options because it's point. cheaper than the stocks. it trades at a valuation, but i the stocks keep failing. >> what's so surprising is the would expect a pullback. january strike, to go out that >> it's the exact stock in terms far on these names. of ibm, balance sheets, same type of run. there's a lot in between. congress comes back into session, who knows? i think it's the levels now. you want to be taking profits. >> there's definitely been >> we will go back to the hewlett-packard story and update debate about that, you know, and stocks aren't moving around a you on the after-hours action. lot right now. so for people to go out to

in the after-hours market, january, say buy some calls and play the up side off of january, oil is crossing $70 a barrel. that's a bullish expectation. api inventories, there was a drop there, american petroleum >> brian stutland, thank you very much. institute. joe, $7. >> the bottom line on oil over of course catch me and bryan the past six weeks is no one has gotten this trade right. 8:30 p.m. eastern time.t 8:30 p.m. eastern time.t final trade after this break. and right now you had the rollover yesterday, now you're right back north of $70. thw netbook from at&t. no one's positioned for it again. with its built-in 3g network, it's fast and small, no one's getting the oil story right. it is extremely volatile. so it goes places other laptops can't. yes, it is tethered to the i'm bill kurtis, and wherever i go, dollar right now, but everyone i've got plenty of room for the internet. longer term wants energy exposure. and the nation's fastest 3g network. you want to stay with the oil service names. you want to stay with the refiners. gun it, mick. you want to stay with the integrators. but the oil futures are (announcer) sign up today confusing people because they and get a netbook move so quickly. for $199.99 after they move people to the mail-in rebate. with built-in access to the sidelines in those names. nation's fastest 3g network. here you are oil above $70. only from at&t. it will be a positive session even during times like these, for oil tomorrow once again. again, i don't think people are there is a light beginning to shine again. fully invested. it comes from a restaurant downtown. >> i think the play for -- first time i've said this in a while, it might be net gas -- a shop on main street. >> really? a factory around the corner. entrepreneurs like these are the most powerful force in the economy. >> it's interesting, nat gas is the reinvention of business begins with them.

on the fourth day of the roll, today. and while we're sure a lot of people had to bail out. i won't get into why. we don't know all the answers, but the hurricane season coming, it might be interesting. we do know one thing for certain: we want to help. look at apache and their quarter come see what the beginning looks like they reported on july 30th. it was ridiculously strong. at openforum.com the stock has had trouble at $86. you know what, gets above $86 and holds, apache might be the play. >> if you believe in the oil story, energy and all that stuff, it comes right back to commodities. got to go back to coal. love the control name. across the board, i still love those names. they've got a big run. >> and month of august, up 12%, 15% -- >> this was a sector that absolutely got taken out back and flushed down the toilet, and now suddenly they're back, but look at the levels they're coming from. there's still up side. >> i want a comment from the liquidator about nat gas. you were shaking your head. there aren't many people on this desk who would say play nat gas. >> that's a she loves me not on that one, sorry, guys. >> she's basing it on hurricane season specifically, though. >> stories at national gas is it's at historical levels. it's extremely high. if you look at natural gas right now, the shape of the curve

bodes further weakness. i truly believe in natural gas sitting right now at $3. if you break below $3, i think you will see a complete liquidation from the long side that could take natural gas down to $2. >> you guys point, though in terms of a technical reason why it trades as a premium to the commodity? is that a reason net gas may be a play, if you're betting on the etf? >> i just know the last few days there's been huge selling based on the ung in the gas futures. i think 10,000 contracts have been sold. that's a pretty big number. the fact that we're still here sort of holding around this $3.05 level, might be an interesting trade. at $5, i would agree with joe exactly in terms of supply and demand, but at $3, it's a different trade. that's why i'm not playing ung, but look at apache, especially if it closes above $86. >> lastly, will you calling $55 or $85 first? i'll say $85. you go. >> $85?? >> you go. >> $85. >> all right. > time now to reveal who made then you want to be buying oxis. the most money today. the top spot goes to elaine >> over the next week, over the wynn, the wife of wynn resort next month, that doesn't do

anything for me in terms of -- >> well, it does something if billionaire steve wynn who sold you want to buy oxy. it's levered past oxy. i'll say away from hess at this $114 million worth of the couple's common stock in an effort to have more cash on hand point. >> if you think oil's going to $85, then you're betting the in anticipation of their pending stock market's going to go down, divorce. the shares represent less than because once it hits $85 -- >> no, that's old school. 10% of the wynns' holding in the it's not going to be that way. company. time now for -- >> it's a steady move, though. >> and they were cheaper to keep it can't spike up there. her? if it spikes up there -- does that go over, or -- >> it's draining everyone's pocketbooks. >> right. >> but it's seen now as oil is >> let's go to the final trade. coupled with the overall market kick it off. that moves higher, the overall market moves higher. >> technology rallied today, but one name that didn't perform all right, let's move on to along with it google. the next trade and talk retailers, shall we? i actually bought some puts. >> i've got an itch about net home depot leading the sector gas. apache. higher in the rebound after >> all right. beating earnings and raising steve? guidance. >> apple. i've been waiting for an entry point. target also beating profit expectations. i'm tired of waiting. >> pete? >> i've got to like palm. your advice, focused on home the special sauce, the special depot yesterday. >> yes, we did. sauce, the rbc analysis is talking about, it's all these >> saw the nice pop today. apple guys that keep coming over >> well, we said don't make the to palm. giddyap. mistake of shorting home depot >> i'm melissa lee. thank you so much for watching. on the back of what lowe's did. they're completely different companies. valuation, home depot's a little richer, for good reason. see you tomorrow 12:45 and back frank blake has done a tremendous job at home depot. see you tomorrow 12:45 and back here at 5 p.m. for more "fast the numbers back it up. they went out and raised money" right here on cnbc. guidance back in june, told you exactly what was going on. they're running their company one... yeah! hundred.

better. lowe's is not. no. lowe's went down today, if you cheer brightclean. look. another couple percent on the surprisingly bright in just one wash. back of yesterday. home depot higher. i'm not saying race out and buy the first complete women's multivitamin in a drink mix. home depot here, but we have been talking about it for a while. with more calcium and vitamin d... my point is, if you shorted home depot yesterday on the back of lowe's it was a huge mistake. to support bone and breast health... >> yesterday was a huge mistake. while helping you hydrate. would it be a mistake going into one a day women's 2o. tomorrow's session? >> in terms of shorting home depot? refreshingly healthy. personally, i don't like playing from the short side. i like the dips. introducing the all new chevy equinox. if you want to play in the deep with an epa estimated 32 miles per gallon. end of the pool, that's fine but not for me. >> how about a direct play on and up to 600 miles between fill ups. the consumer or perhaps some of the homebuilders, the recovering of the housing market? >> i'm stay away from homebuilders. it's a little squishy there. >> squishy? it's the most fuel efficient crossover on the highway. >> who started that. better than honda cr-v, toyota rav4 >> is that jim goldman that started the squishy word? because i love it a lot. and even the ford escape hybrid. >> i'm not sure -- >> i'm short homebuilders, kb homes, avalon bay, which is a the all new chevy equinox. reit. in terms of the consumer sector, if there is a play out there, i agree with guy, i think home depot basically kicked the snot out of lowe's -- >> oh! >> look at the performance of target, though.

i think target is managing the bottom line phenomenally well, and now you have back-to-school season, and if you look at target and line it up against walmart with a consumer clearly looking for the cheapest possible price, that price is going to come from target. i like target. >> there's consumers out there still willing to spend and i'll tell you why. look at true religion. they had august activity in the calls. they were buying the upside calls. this trades at a 10 pe right now, 17% short interest in the stock. their earnings continue to grow. their profits continue to grow. they're expanding, their sales are going up, everything's going imagine... right for true religion, and one scooter or power chair that could improve your it's cheap! 10 pe, you've got to like this mobility and your life. name. >> do you wear them? >> i've got to tell you, i don't one medicare benefit that, with private insurance, may entitle you to pay little to nothing to own it. wear true religion. one company that can make it all happen... >> good. >> don't like the horseshoes on the back of your ass? your power chair will be paid in full. >> whoa, what did you say? >> he kicked the snot out and the scooter store. squishy? fine. hi i'm dan weston. we're experts at getting you the scooter or power let's move on. chair you need. in fact, if we pre-qualify you for medicare dvd wars, the maker of the reimbursement and medicare denies your claim, we'll give you your new power chair or scooter free. machines takes on the big.

i didn't pay a penny out of pocket for my power chair. a judge ruled redbox could take with help from the scooter store, -- or continue with an medicare and my insurance covered it all. anti-trust against universal. call the scooter store for free information today. movie studios may be in trouble if the dvd rental business call the number on your screen for free information. continues to get more powerful. rich greenfield is a media analyst joining us here on set. i think the movie studios are already in trouble, rich. aren't they kicking the can down the road? they've got the face the facts. >> absolutely, it's difficult. the maturity level at the movie theaters, dvds were a huge growth business throughout the '90s. we went from everybody renting casettes to buying dvds and it became a massive business for the studios. but now you've got this little weed that was growing in your garden, you didn't pay attention to it and all of a sudden, there's 19,000 of these weeds all around your garden, and all your good dvd business where you sell these things to your consumers for, you know, $15, $16, $17 a pop, all of a sudden, you've got this box sitting out front. and you go to walgreens right in times square this afternoon and there's a box sitting there that it's here and people want to rents these things for $1 a day. see it. and $1 a day is a really low >> i think people enjoy seeing price point when you look at any sex.

a lot! other part of the movie industry food chain. >> i was fully addicted to the >> it kind of crept up on the material. >> i had a business drive, like movie studios at the same time i wanted it, i wanted to be a sex symbol. i always have. you are an investor in the studios, a shareholder at this point. >> we've made hard core into at what point do you say got to hard-to-believe core. get out of these stocks because >> when i was miss usa, i had redbox is going to change the certain responsibilities to landscape, change the business model? >> it's a real fear. uphold and i did that. why -- if people can get it for news corp has 25% of their free, why pay for it? earnings coming from the film business. >> the first thing we need to do is combat piracy. that's the twentieth century fox studio. >> it really actually turns me this is a huge issue. on that people watch me. for time warner, it's 20% and >> female audience is the you've got other companies like largest growing demographic by far. lion's gate where it's the whole business. >> i was acting out sexually, >> would you say those are names to sell? even in spite of the those are not worth owning at this point? consequences. >> we have a sell on news corp >> pornography has been around for other reasons than this since the time of the cavemen. issue specifically, but i think, you know, there's absolutely a it's not going anywhere. growing fear that we have looking across this whole space right now that if this issue isn't dealt with -- studios are trying to say you can't rent these movies at a redbox for 30 days. you know, just like with vod. you can go home tonight and there's a few movies you can get with the dvth dvd release, but there's a window. welcome to the crossroads of with universal, fox and time the world, new york city's times square. i'm melissa lee.

not too long ago, this was a warner, what all three companies very different place. want to do is say on day one when movies come out, new instead of restaurants and retail chains, there were adult release tuesdays, when they hit theaters, peep shows and at a tuesday morning at walmart xxx-rated book and video stores. on that day, you can't rent at a in short, this was the epicenter kiosk that movie for 28 to 45 days. of american porn. >> at what point are the kiosks now that has changed and so has and netflix, at what point are the $13 billion pornography they obsolete, or are they keeping up with the technology? in other words, are they doing the kiosks now, but they're industry, an industry which aims to please, but to many, often moving into online demand type stuff? offends. >> the reason it's a critical it's an industry under assault, issue is because it's very much still a debate. not just by its critics who find there is no definitely answer. porn socially od there was a court case yesterday. two-thirds of redbox's claims against universal were dismissed. one-third was allowed to proceed to trial. so this will be a 2010 court case. it is a really big issue. 60% of the studios are against working directly with redbox. 40% -- disney, lion's gate and actually sony are working with them. >> you brought up a name i wanted to ask you. disney, how does this affect them going forward and how does this affect your rating of disney? >> look, i think this is a lesser issue for disney in scheme of the walt disney company because they have family movies.

and at the end of the day, just like dreamworks, which i didn't mention, they are 100% movies, these are movies you generally want to own. >> collectability. >> there's a collectability element that's not there for a company, like a fox. that said, "bolt" was not a collectible film -- >> well, depends on who you are. >> i know. >> it depends on opinion, you know. >> and "race to witch mountain"? >> right. >> i'm sure there aren't a whole lot of copies stocked on the shelves. >> but "cinderella" and "findy nemo" you'll watch again and again. >> but "iron man," i guarantee that's a film you want to own, "harry potter." there will be films you want to own. good movies, but the problem is they don't just make good movies. >> does rich want to be a movie critic? >> i think he does. rich, thank you. rich greenfield of pally capital. you might want to wash your hands the next time you reach into your wallets. a new study finds that 90% of u.s. currency has trace amounts of cocaine residue on it.

according to the university of massachusetts, 90% of money in washington, d.c., was contaminated compared to only 17% of the currency in salt lake city, home of the mormon church. >> i'm using credit cards these days. nothing on me. >> that was the "word on the street." coming up next on "fast money" two new stories. after-hours. oil $70 a barrel and hewlett-packard losing ground. we're monitoring both of them. we'll have the latest. stay tuned. is this a bull market or just bs? a legendary wall street strategist makes the market call and he and the gang give you the way to play. and -- >> my cold, dead hands! >> reporter: this is how some people feel about their cell phones. why the tech trade could stay on top. plus, china served up the demand and our companies took a big bite, but a china bear market could leave investors with a bad taste in their mouths, when america's postmarket show continues. ran f with his secretary! she's 23 years old!

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welcome back to "fast money." we're live at the nasdaq market site in new york city's times square. let's check on a big after-hours story, oil crossing $70 a barrel. there is a drop in api inventories. the dollar index, just fyi, is

flat right now, so oil and the electronics session, joe, above $70. grassley made a challenge -- >> on its way to $55. >> you said $85 or $55 -- >> i don't understand what the challenge is -- >> stock to buy. you want to buy stocks that are levered to oil. that's the only point. >> okay. >> does that help me this week? >> well, yeah, because if it's going to go higher -- >> what's the play? >> the play ahead of you this week is if oil can sustain above $70, go with the high-bidder names, go after the oih, transocean. those are the plays right now. suncorp, a name pete has spoken about a lot, another name you want to own. the key is if oil sustains above $70, and if it does and takes out the double top formation, you're going to be right, and pete will be right because it's going to go to $85 quickly. >> how long is sustained in your view, joe? >> you need oil to sustain above $70 for the next five or six trading sessions. >> oxy, you could also short that stock. if you think oil is going lower on a day-to-day basis, you can

be short oxy as well, so -- >> you really like oxy, huh? >> good point there. >> want to change the topic and move on to another after-hours story. let's check on hewlett-packard. it is apparently moving lower. the conference call got under way about 25 minutes ago. it was a beat on the eps as well as revenue number. we are seeing that decline here in the after-hours session. some headlines out of the conference call. ceo mark hurd saying he is seeing improved demand for printers, that business seems to be stabilizing as well. so, so far, it seems a positive commentary is coming out of that call. we will check in once again with jim goldman for the very latest a little later on in the show. time now for "bull market or bs." market bouncing back today after yesterday's near 200-point dive. a sudden sell-off like that has some thinking a market's top is being made. joining us now, former jpmorgan strategist who called the market master back in 2000, doug cliggott, cio of dover management. he is on the line now. >> thank you, melissa. >> what do you make of the

market action as of late? >> if you take yesterday and today in a glass and shake it up, that's probably what the next six months will look like, good days and bad days. >> a market martini, then, i guess. >> yesterday maria had an interesting interview with the l.a. wave guy. he basically thinks we're in the fifth cycle going lower. do you adhere to that or is it more hodgepodge the next six months? >> i think if we're going to move in a big way, it's probably down, not up. i'm really not a technician. i look more at fundamentals and fund flows. and i think, you know, we have had some fundamental improvement. things have stabilized a great deal. manufacturing's actually looking pretty good, but that's a small part of the u.s. economy, unfortunately. that's, you know, that's only about 9% of employment. what has me concerned when we look ahead is we've never come out of a recession with household debt levels this high relative to income. >> right. >> actually, incomes are

declining now. the saving rate, even though it's up, is still very low in a historic context. >> so, doug, if i may, where are you parking your money in this sort of environment? >> i think you have to have a bar bell strategy. i think a good part of your long exposure has to be defensive, places like health care, consumer staples, electric utilities. we wouldn't put all of your long exposure there. i think there are some global themes we think are investable. we like agriculture, we like water, we like construction and engineering. i mean, there is going to be -- >> doug, a lot of that story -- a lot of that story we as investors know. i'm going to throw something into the mix. we're talking tonight about oil prices, everybody's getting excited at the desk about where oil's going. what is the impact if oil continues to rise, gets above $75, gets above $80? is pete correct, is that damaging to the broad economy? what happens then? >> it's incredibly damaging to the u.s. household sector. i mean, come on. incomes are going down. we can't afford a new tax. >> what's the number on oil?

>> well, i think it's mostly technical. >> what's your number that throws the economy into turmoil again? >> i don't have that magic number. i just, i think lower oil's better for the economy than higher, and i'm not even sure energy stocks go up a lot on higher oil, because the big, major, like exxon, you know, chevron, the global majors, they aren't doing any investing right now, and that has to happen -- >> right. >> -- for the oil services and drillers to do well, and they're sitting on their hands. >> doug, i think the one thing that could help out with oil would be if it was a slow, steady move to the upside. then people could digest it as it happened up towards $80, $85, but if we actually catapult up like you're all inferring, i think that would be the problem. do you agree that if we moved steadily up there, we'd digest it as we went and the gas price wouldn't be as ugly when we got there? >> i think that's true for almost any commodity. you know, if we get there slowly, you can absorb it.

if you get there fast, it's a real shock to the system. >> all right, doug, got to leave it there. thank you for joining us. doug cliggott of dover management. let's head to the desk to tackle the walmart conundrum. while the overall market has rallied more than 9% this year, the world's biggest retailer is still down about 8% in 2009. so, is this giant poised for a breakout or breakdown? steve cordes of veracruz, aka, el capitan, joins us here on set. capitan, you say there is a new normal. does that necessarily mean walmart shares will go higher? >> correct, at least on a relative basis, melissa -- >> wait, i'm asking, does that necessarily mean walmart shares will go higher, even if there is a new normal? >> yes, correct. i'm saying that because there's a new normal, walmart shares will go normal -- sorry, will go higher. will go higher. if you believe in the new normal, the theory promulgated mostly by pimco, the thought that we'll have to recalibrate tour economy to lower growth, lower employment, lower expectations, more savings, an

era of frugality and thrift, a kind of economy of hoarding. in that environment, i think walmart succeeds in an era of thrift. because of that, walmart has underperformed the last several months, but i think it's time to reverse from lagger to leader. particularly versus higher end retail. >> what is the catalyst to get every investor to realize steve cordes is right, walmart shares should move higher because it hasn't worked so far this year? >> correct, but it has in recent days, and that's important. in august, this trend is reversing. i brought a chart along, if we can show it. it's a chart of walmart versus a basket of high end. i chose four high-end stocks -- harley-davidson, nordstrom, coach and morton steakhouse. as the chart is rallying, walmart is growing as a percentage of the basket. if it declines, it is declining as a percent of the basket. it's a new uptrend but there is an up trend in place. walmart is starting to base outright and on a spread to this high-end, aspirational type of names. i believe this trend has legs,

so it's something we are investing in. >> how about if we don't get into the new normal, do you still see the stock as a buyer? >> a buy, but a boring one. i think it's only a place for safety in that regard. walmart has basically spent the last ten years around $50, it really has. but boring, in my view, after the run we've had, boring is good. >> right. it's a bunch of people at home that wish their stocks stayed around the level where they bought him. >> boring is good. >> not bad. got to leave it there. >> and steve dressed alike today. our moms put us in the same outfit. >> great to see you. the tech comeback story, coming up. the company that makes the chips inside your cell phone and your 52-inch plasma's up 52% this year. the ceo explains why this semiconductor stock is beating the pack. and guy has rolled the dice on one casino stock. so far, he's hit the jackpot, but is he really to cash out? are you ready to cash out? >> i can't tell you! >> find out after the break. [ d. on the inside. my inner-workings a work of art.

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going on for approximately 35 minutes. jim goldman has been on that call. jim, what is the latest? >> yeah, just a couple quick nuggets here, melissa. we're seeing hp give back a big chunk of its after-market rally as soon as the numbers were released, and that might be the same problem that cisco systems was suffering when it came out with its earnings, essentially talking about a turn-around, not necessarily here, but on the way or we're getting indications that things are improving kind of sort of. it's that kind of modest approach right now dampening those expectations. hp says that is the prudent way to go, and i think that's what's spooking investors. people wanted to hear something, well, a little bit more optimistic than what we're getting right now. and also, the good news may not even be such good news when you're talking about that improved demand for printers, because very uncharacteristically, hp may have been caught flat-footed. demand improved so much for printers that there simply wasn't enough supply to fill all of those orders. so, a company that is so steeped in operational excellence under

mark hurd may have cut too close to the bone as it was, you know, basically so focused on those bottom lines as well as the margins. so, we're seeing that also maybe not be taken as such good news. it's a great problem, but nonetheless, still a problem to have. >> jimmy, don't you think, had this been back when intel was reporting, a month and a half, month ago or so in the earnings cycle, this would have been received a lot differently than it is on a stock that's already made a 20% move? >> i completely agree with you. there is no question that timing is playing into this. but you know, keep in mind that hp, because it's reporting so much later, gives us a little bit more of a window into the current quarter. and that's also something that people are taking into account here, and that may not resonate as well as maybe somebody might think tomorrow. maybe hp is seeing little bit of softness. maybe the company is feeling a little less sort of secure in where the guidance is going from here. things are pointing in the right direction, but mark hurd is just fallen short as far as being as optimistic as people wanted. but a month ago, this would have been a lot different.

>> if we can check on the qs, jim makes a good point about hp reporting much later and what does this mean for demand for technology later in the quarter? it will be interesting to see the impact on the trade sector. slightly lower, not much of a move. as the news digests, we'll certainly watch this. jim goldman, thank you very much. we'll check back with you as news warrants. from flat-panel tvs to dvd players, this company provides some of the magic behind intersil. they are up 50% this year, guiding the quarter revenue above estimates. does that mean the demand story is back? joining us, the company's ceo, david bell. thanks for joining us. >> thank you, melissa. >> in terms of the consumer, what are you seeing in demand in the end markets that may indicate the worst is over? >> well, demand is clearly down from a year ago, but what we're seeing is demand looks like it's probably stabilizing to some degree. visibility's still pretty poor, hard to predict exactly what the christmas buying season's going to be like right now.

we're kind of right now in the midst of back-to-school, and we have to get through that and see how back-to-school is and then go from there and see how the rest of the holiday season's going to be. but clearly, demand is down from a year ago, but the inventory is pretty well cleared out of the channel at this point. so, we think we're pretty much shifting at consumption at this point. >> are you seeing the demand in back-to-school in terms of the pcs, in terms of mobile phones? >> we're seeing it in both, both pcs, a lot of it notebooks and netbooks now, phones. antidotally in the evidence now, back-to-school looks good. so some of the people in the southeast going back to school now. looks like early returns are good news. >> you have a great balance sheet. what does it look like going forward from the standpoint of any acquisitions along the way? we talk about technology all the time and all of the consolidation. is there any ideas for you guys going forward to inorganically show any growth? >> just a little background, during the past year, we have done actually four acquisitions of private companies. so, this downturn is discouraging, but we're taking advantage of that. we are one of the first to restructure in the industry, and

i think we're really doing the best in our semiconductor industry at exploiting this downturn, doing acquisitions. like i mentioned, four of them during the last year. i think there could be other opportunities coming along. it's a really bad time if you're a start-up company, because unless you're cash flow positive today, your options are basically two -- you either can get acquired or you go out of business. so, we got the pick of the pack here and we get to get some really fantastic, strategic acquisitions for really good prices. >> mr. bell, thank you so much for your time. we appreciate it. david bell, ceo of intersil. the stock is up 50% based on what mr. bell says. do you think this is a buy? >> i think what he's saying in terms of gross margins this quarter a little more disappointing than last quaer, down 54%. do you think all the acquisitions affected gross margins or are you happy with 54%? >> we think it's going to go up from there. going back a few years ago it was closer to 58%. we actually think we've done pretty well compared to most companies. our sales were way down, gross margins were down less than 4%. and what we've told the analysts

is that we're charting a path that by the end of 2011, we expect our gross margins back to 58%. there's a number of things doing that. product mix is one of them, cost reductions, doing some of the same things that our customers are doing to us, squeezing for prices. we're squeezing our suppliers for some of those same reductions. >> all right. hope to have you back before 2011, david bell. >> thanks, melissa. time for today's edition of "pops and drops." we start with a drop for the parent of tj maxx, down 3%. joe? >> how could you have disappointing earnings in this environment? i don't understand that. tj maxx, marshals, terrible earnings. this stock probably gets in around $34 right now. >> pop here for agilent. it was up 8%. pete? >> they beat by 4 cents on the year earnings, got a great outlook. they actually can't keep up with demand right now. >> drop. down 10% today. >> an application was put on hold by the fda, but this is one we've been talking about for a while. went up to $9.60 a couple weeks ago. this is a lottery ticket worth owning.

>> and this was up 5% along with the smartphone makers. >> palm pre looks excellent. no matter what the recession does, you're not giving up. that's your cell phone. >> all right. we've got to drop here for the zimbabwe dollar, also known as the zimba. i just named it the zimba. it is officially dead. the government has replaced it with the u.s. dollar, the south african rand in a record to curve record world inflation. it now costs 3 billion zimba to ride the bus there. the equivalent of 50 u.s. cents. >> every time i talked about the zimba -- >> what'd they replace it with? old glory. usa dollars. coming up next, you can blame yesterday's sell-off in the u.s. on rumblings in the chinese markets, but will more shanghai swoon send the s&p into sell-off mode? cnbc's amanda drury is here to help us with the trade as china, the world's growth engine, begins to show signs of sputtering. back in a moment. ♪e

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♪ was it a deal with the devil? china providing us with cheap goods in exchange for trillions in u.s. treasuries. they get access to our

insatiable demand and we get access to their unending supply of electronics, clothes and machinery. now, for better or for worse, the chinese and american economies are linked at the hip. sunday night it was for the worse. as the shanghai sold off, it left a mess of u.s. markets on monday morning. what's worse, shanghai's shares are already down 10% from the highs, and some say headed for its own bear market. as decoupling dies a slow death, is there any way to untangle a u.s. recovery from an unraveling