that's 3/4 of 1%. not even the best levels of the afternoon, scott. nasdaq also higher today, 12 1/2, extending yesterday's big rally. money moving into tech yet again at 1,968 on the nasdaq. and the s&p 500 up nearly 7 points. >> and maria, our team is covering the markets, the nyse, the nasdaq, and the nymex. but first to our bob pisani who is our eye on the floor at the new york stock exchange. bob, they want the market to go down. it's just not going down. >> and it's been frustrating for a lot of traders because bulls and bears seem a little bit invested in getting a bit of a drop. bears because they don't think the market is worth it at this level. balls bulls because they want a drop because they want to buy lower. let's take a look at what happened in the middle of the day. the bottom line is this -- stocks declining an opportunity to drop once again here. we are back in that trading range that we've been in throughout the whole month of august. there was only that one day on monday where we actually saw real selling pressure and other than that it hasn't been around for the last month. as for what's moving, commodities. the dollar is lower here, been strong all throughout the day. speaking of commodities oil's

been strong all throughout the morning. weekly oil inventories showed a drawdown rather than a build as expected. some of the big names like occidental strong all dlout the day. in the equipment area we saw deere a little bit in either direction here. it's really kind of a tough call because the conference call said they would be break even for this current quarter. we were expecting a gain of 35 cents. the bottom line is equipment sales just are not coming back in the way that they thought they were going to see and they're going to have lower production as a result. i've been asked a lot about china throughout the day. citi had a very interesting note out pinpointing some of the laenz reasons. the shanghai index is down 20% in two weeks. the main cause of the problem they noted too bank lending has been slowing down. as banks have slowed the lending there's been lois money that's flowed into the stock market. this goes to the big observation that a lot of china's lending efforts have gone to speculate in the stock market. and the other two problems. ipos have come back. they weren't allowed for a whole year, now they're back in july. that's a lot of competition for the stock market. look at the shanghai index. what do you say for an index

that goes down 70% in a year, then rallies back 100%, and now is down 20% in two weeks. i call that volatile. tradertalk.cnbc.com. rebecca, how are we looking over at the nasdaq? >> hey, bob, we're looking higher, but just as much as china is the story for stocks there, china has a lot to do with the story of stocks here. as you heard from maria bartiromo at the top of the show-n her conversation with hp's ceo mark hurd, china played a major role in their earnings, and we do see that playing out here at the nasdaq as well. also hp yesterday in their earnings report mentioned the fact that essentially they see tech spending bottoming out here. that could be a positive, or it could mean stagnant growth ahead. you do see the likes of dell up about half a percent here right now. cisco, meantime, big tech trade to the up side by 1.6%. google, a happy birthday to google. it's five years old as a public company today. not such a happy day for them, though, as their first day at this market site, they're down .7% on the day they were born as a public company they were up

18% in that one day and they were about 100 bucks back then. netflix shares to the up side by 3% today, getting an upgrade at kaufman. they think the dvd business has some signs of strength. and also the digital business will be strong going ahead. here's an interesting one, folks. cell therapeutics. it is the most active stock getting traded here at the nasdaq, today up 9.6%. what's interesting to note is there isn't any major news out on this name, but average volume there three times what the average volume is there today in that trade. lastly, i want to look at dryships. it's down 2 1/2%. and this one tends to trade somewhat in correlation with oil. as a dry shipper they're very susceptible to whatever the economic data is. so it's interesting to note that on a day where positive economic data or so to speak positive economic data helped send oil prices higher you're not seeing the likes of other commodity-driven stocks higher as well. brian, over to you for more on that oil trade. >> one word for you, rebecca, and it's wow. who'd have thunk it, right? you have oil rally, dollar weak,

and equities get turned around by that. well, obviously, if oil goes to 80, 85, 90, maybe the conversation will change, but i want to take folks through the entire day because it really tells the whole story and it moved so much today. of course we were a little weaker at the open when it came to that overnight china story. then we rallied a little bit into eia numbers, and then of course it spiked right away. most traders telling me that was short covering. we had a bit of 'pause, and once we started seeing the equity markets turn there was another leg up and it stayed strong throughout the day. of course that data helps. plats came out with a report saying implied demand in china up 4% year over year. that covered some of the doubt about china. i also want to touch on quickly for people what those inventory numbers were. pisani talked about it. we ended up with a drawdown of 8.4 million barrels. expectation was for a build-up of 1 million. that's a 9 1/2 million barrel swing. we had a $4.50 range when it came to crude oil. i want to quickly check the entire complex. all to the up side.

nat gas is the one i want to focus on because it had a nine-day losing streak. we get their inventory numbers tomorrow. 51 to 55 bcf build below trend is what plats is asking for. i also want to touch on metals. i know it gets lost in the shuffle. gold of course playing off the dollar. copper, silver, still a little affected by the china weakness. i also want to point out, maria, that tomorrow is the last day of september as a fund month contract but when we talk about this number, demand destruction, it was at 140 plus last time we talked about it, i wonder how oil would have to be to destruct demand once again. >> thanks so much. we will get back to you on that important point because we are looking at the oil market really driving things today. let's talk more about investing in this environment with our guests. scott-minute nard, goog chaim partners chief strategist. along with epoch investment officers co-chief investment officer. what's your biggest takeaway

from today? >> back in january, february the markets were discounting the end of the world, a doomsday scenario. as soon as it was clear that the banks wouldn't go bankrupt, the solvency was solved, you had an i'm not going out of business rally. and the problem is the worst stocks, the ones that were closest to going out of business were the best performers. and then the cyclicals who were losing money were also the best performers. here we are with cyclicals having way outperformed. defensive stocks lagged. and the economy is only slowly recovering. and the market the way it's valued today is assuming a robust recovery next year. that's the big question. our view is you can't have a robust recovery unless there's end demand. and when you think of the u.s., that's consumers, consumers are weak, and they've been continuing to be weak. look at retail sales. consumers are in debt. they have to pay down their debt from credit cards to home loans. and their wages aren't going anywhere. so it's going to be a long road.

>> we didn't see any revenue growth, or little revenue growth as opposed to earnings better than expected. >> you can only cost-cut your way to prosperity so far. that's it. >> and scott, david says very slow recovery. maria and i looked at these notes and we saw 6% growth third quarter? >> that's what you were expecting. >> we expect it to be 6% or higher in the third quarter. and the reason for that is, one, if you go back, you look at the auto production data, if you look at the wards production data for the third quarter, the last time we had this kind of a pickup in auto production was back in 1971, and that was associated with an 11.9% growth in gdp. i agree with david that a lot of the good news has already been discounted. the market is a discounting mechanism. but having said that, i don't agree with the fact that we can't have earnings by controlling costs. there were long periods in american history where earnings growth continued as a result of efficiency and cost reduction.

and i think that's the kind of period we're in going forward. >> where does growth come specifically? if i want from an investment standpoint i want to follow the growth, what are the sectors that are actually going to show growth in the third quarter? >> well, i think the sectors -- it's two things, right? the question is what stocks are going to perform well? what sectors are going to show earnings growth? obviously, things like autos, technology, any of the cyclicals are going to behave very well, and earnings growth could -- is going to be very impressive. the places where i'm actually looking right now are some of the areas that haven't participated but as the growth continues they're going to pick up. i think the most undervalued asset in the equity market today is an energy. energy stocks have largely missed the rally. and if i'm correct and we're going to have a robust recovery here in the second half, we will see upward pressure on energy prices and that should help energy earnings. and i think the long-term bull market in energy is in place for the next decade. >> so right now you've got oil at $72. you think it's above 100 in the next six months?

>> i wouldn't be surprised to see it above 85 within the next six months. i think we got some choppiness here in the late summer. but going into the later half of the year. >> we have the opposite view really. we're long-term energy goals because the long-term demand from emerging nations like china and india will in fact drive prices higher, but in the short term it's been that stimulus in china. they've basically stimulated their way to prosperity, but it can only go so far, again, because they're an export economy, unlike us. so unless somebody's there to buy their goods, it can only go so far. >> let me ask you quickly on china, is the chinese market the pullback of 20% over the last two weeks that we've seen in the shanghai market, is it telling us something? the chinese market was first to rebound before we did and first to perhaps top out before we did. >> totally agree with that. in fact, some of the stimulus has been the chinese stock market itself. because really it's a command control economy. once they know the money's not coming in, the market goes right

down. so we keep away from that. and the implication is that they've been driving commodity prices higher where rest of the world hasn't had end demand. you wonder how that happened. so our concern is we're going to have a dip before it goes back up. >> you know, gentlemen, great conversation. we so appreciate it. we will continue following this developing story. both on the other side of the trade sxfrks that's what makes a market. we should point out, scott, that we are losing this rally fast. we've got the oils doing very well, but the industrial names are turning around and getting weaker right here. that's why you've got the dow jones industrial average right now cutting its gains in half. up now just about 44 points. >> we are up for a second straight day, though, but can the market keep heading higher or should investors be bracing for a pullback? >> and then after the bell, americans buying up new cars thanks to that cash for clunkers program. but what will it take to get consumers spending in other areas of the economy going? the three keys to a comeback at 4:00 p.m. eastern. >> but first, the most active

stocks on the new york stock exchange, led by a couple of financials -- citigroup, bank of america, and the parent of this network, general electric. tdd#: 1-800-345-2550 if i'm breathing, i'm thinking about trading. tdd#: 1-800-345-2550 i always have my eye out for a stock on the move. tdd#: 1-800-345-2550 doesn't matter if a company sells computer chips tdd#: 1-800-345-2550 or, i don't know, fish and chips. tdd#: 1-800-345-2550 i'll look at all kinds of stocks before i settle on one. tdd#: 1-800-345-2550 if i think i'm onto something i'll check it out, tdd#: 1-800-345-2550 you know, see what other traders are up to. tdd#: 1-800-345-2550 when everything feels right though, tdd#: 1-800-345-2550 that's when i get serious. tdd#: 1-800-345-2550 and the minute i get into something, tdd#: 1-800-345-2550 i already know when i want to get out. tdd#: 1-800-345-2550 of course, every now and then i'll talk with somebody tdd#: 1-800-345-2550 who knows what i'm trying to do. tdd#: 1-800-345-2550 (announcer) switch to schwab today. tdd#: 1-800-345-2550 you'll get the tools, the technology

tdd#: 1-800-345-2550 and the support to trade your way. tdd#: 1-800-345-2550 go to schwab.com/trader tdd#: 1-800-345-2550 or call 1-800-540-7304 tdd#: 1-800-345-2550 right now. tdd#: 1-800-345-2550 but opportunities can vanish like that... tdd#: 1-800-345-2550 ...so most days, i'm right there tdd#: 1-800-345-2550 when the market opens.

hi, folks. i'm matt nesto with your "closing bell" realtime flash. want to draw your attention to pet smart, petm. the stock's up 3 1/2%. and i tell you this because that's good but also because this is ahead of earnings. you can see it's building momentum as we go into the close. earnings coming up after the close. look for 29 cents on 1.3 billion plus positive same-store sales comparatives north of 2%. it's in the mid-cap index, russell 1000. it's one of the top five performers in the greater retail industry group. but it's had a pretty good run, and it's strong ahead of earnings. the same can be said for limited and hot topic, both up 3% and 2% respectively. maria, back to you. >> thanks so much. so to correct or not to correct. that is the question investors are asking these days. the market's been up the last two trading sessions and

certainly on a roll recently but according to a new report by bank of america merrill lynch september and october are the months when a correction is most likely, and certainly we've seen that in the past. we get the details with marianne bartles, with bank of america merrill lynch. great to have you on the program. welcome back. so what can you tell us about september and october? >> september 60% of the time is actually down. so we've had a great run in this market. we're up just a little over 50%. our indicators are so overbought. we've got readings we haven't seen since 2007. so we think we're forming an intermediate top here. and this would follow the seasonals. you generally peak somewhere in the months of august, september, september being down, then you make important bottoms in october. so we think we're going into a little bit of a rough patch moving into the fall. >> so are you telling clients to take some money off the table here, raise a little cash? >> well, if you're a very short-term-oriented person i think you can raise some cash here.

but i think the most important part of ow message, that we remain in a base-building process, we believe the lows of march are in, they don't have to be tested, and this correction is just a normal course of the base-building process. and as we move into the months of november, december, and into january of next year we'll be able to achieve new recovery highs. >> let me ask you this because in your report you're forecasting a 15% to 20% risk of a pullback in september and october. now, we've seen some declines just recently. does that mean, or does that suggest that the decline has begun earlier than typical or do you think it's going to be beginning from the base where 15% to 20% decline is likely in a two-month period? >> we hit really good resistance on the s&p at 1014. that looks like we're starting to peak out there. i don't think we're going to get much higher than that. so i think we're already into the correction. and obviously, we think that's going to play out over a few months. and our target is 15% to 20% on the down side.

one characteristic that we had about this market coming off of the lows is we had what's called a brass thrust. what that means is as we came off the bottom more issues advanced versus declines. and that doesn't happen very often. we saw that at the bottom of 75, of '82. we saw that in 1987. now we have it in 2009. so our indication is that we have a bottom in place but we're just going to have to give up a little bit, kind of consolidate here after that 50% run. >> i know you watch the hedge fund activity a lot, mary ann. what can you tell us in terms of sentiment and in terms of actual money being moved in where's the flow right now? >> well, the last time we met i had highlighted that they really have liquidated their long position in the nasdaq. we were anticipating them going long. that's exactly what they did. and now they have a crowded long position in the nasdaq. that's somewhat negative also for technology. where they also have a heavy

position is they're very short the u.s. dollar. so what's on my watch list is whether or not the dollar can put in a little bit of a bottom here. and then in the u.s. treasury market at the long end of the curve they're extremely short. so for us everything is setting up for the markets to pull back and have a flight to safety at the long end of the curve. >> what do you think about the situation in china right here? we saw that big sell-off in shanghai a couple days ago. we're hearing renewed concerns about the economic slowdown worsening perhaps there. what are your thoughts about the asian market? >> well, that was one of the items we were looking at as a leading indicator of our markets topping. this week we came out and said the market could go down 25% to 30% off the high. they're now down 20%. but i still think there's another 10% down side. if you look at the baltic dry freight index it's still falling. then if you look at copper, which has had a great run, and the hedge funds have been short and they are covering, we kind of ticked to $3, and i think

that's kind of the paerks and i think we're going to see copper fall back. so everything's kind of aligned. it looks like china's slowing down. it looks like equities are tiring. and it looks like at the long end of the treasury curve yields can come down. >> so it sounds like we should be avoiding commodities as well. you mentioned copper. but others along with copar? >> in general, i think commodities are going to pull back. the one commodity i do like is gold, though, maria. i would be long gold here. >> mary ann, great to have you on the program, as always. thank you. and with concerns about where the market is heading, should you be loading up your portfolio with high-yielding dividend stocks? find out which names look most attractive when we come back. >> but first take a look at the bond market. you're the colon lady!

diarrhea, constipation, gas, bloating. that's me! can i tell you what a difference phillips' colon health has made? it's the probiotics. the good bacteria. that gets your colon back in balance. i'm good to go! phillips' colon health.

welcome back. let's take a look at some of the day's research calls, the latest upgrades and downgrades. and the stocks on the move as a result. steelmaker harsco upgraded at key capital markets. strong cost cutting efforts and expectations of recovery later this year. health insurer cigna was down, graded to a neutral from an outperform at credit suisse. the analyst is talking about a lack of capital flexibility, management turnover, and valuation. and as you can see, that stock is up more than 80% just since

march. d.r. horton and toll brothers both cut today to a sell from a neutral. basically, that's worse. by stifel nicolaus because of the home building stocks recently. both companies have seen their shares soar 40% since july. >> while a real rebound in the economy is still uncertain, the best investments may be in stocks that pay investors to wait. dividend plays are back in demand, and both of my next guests say they should remain the core of any portfolio. mike rothen, ceo of the philadelphia trust company, and tim o'brien is senior portfolio manager of the evergreen global dividend opportunity fund. gentlemen, welcome to the program. thanks for making some time for us today. >> great to be here. >> tim, let me ask you first, why should dividends be a part of any portfolio? >> because historically dividend income has accounted for about half of the equity investor's total return. and the compounding of income over time is a powerful builder of wealth. it's not generally recognized, but it's actually true.

you can look it up. that since the founding of nasdaq, the tech-heavy, growthy nasdaq in 1971, the s&p utilities index has actually outperformed the nasdaq by almost 100 basis points a year. >> yeah, mike, the big story over the past year with companies coming out and cutting their dividends, where are we now in that cycle? are dividend plays still a good one to make? >> i think so. particularly with companies that have strong balance sheets and good fundamental businesses. a lot of the dividend cuts were in the weaker companies that had the real problems in the end of last year, the beginning of this year. the financials. the home builders. some of the retailers. i think you still need to avoid those sectors. but companies with very strong balance sheets, food companies, some technology companies and maybe one or two financials, they're doing very well fundamentally. they've got their costs under control. and if we see a little bit of revenue growth in the third and fourth quarter of this year then the stocks can really perform. but in the meantime their dividend yields are significant and they're going to pay us to wait for the markets to turn. >> what are some things that

investors can look at to try and understand whether a company is at risk of cutting a dividend, for example? beyond the obvious things. >> the easiest thing for an investor to look at is the payout ratio, particularly for utilities and financial companies. we own a lot of utilities. they're underperforming a little bit at the moment. but the last time utilities underperformed, they subsequently went on to return over 20% a year. but if you just look at a utility company that's got a decent balance sheet and you avoid the ones that pay out more than 75% of their earnings you can still get quite a bit of income without taking a lot of risk. >> what are some of your picks? >> we like cms energy, it serves michigan, it has some automobile exposure but it's got one of the lowest payout rates in the industry at 40%. decent and rapidly improving balance sheet and one of the best earnings profiles in the industry. we also like constellation energy, which reduced its dividend earlier this year. so they have that behind them. they're rapidly derisk be their

business model and they're growing significantly faster than the average utility. and finally, we like first energy, which is going through some depressed earnings but still is only paying out about 62% of their earnings. they're going to have a down year in 2010, but we expect a pretty significant earnings recovery in 2011. >> yeah, mike, let me ask you the same question but let me also say in aefrnt of disclosure here that both of you guys actually own all of the names that we're talking about here today. now let's get some of your picks. >> love coke, colgate, kraft, intel, and the new york stock exchange. all have significantly good yields, higher than the market, very strong balance sheets, incredibly good cost controls, and all these companies will be poised to do extremely well when the economy turns. i like utility stocks, but they don't always get the kind of kick you need when the economy turns. we think we're some distance off from return but we want to be paid to wait, we want to have companies with strong balance sheets and be in them when the

turn occurs. >> is there a reason why neither you have guys like big dividend plays, j&j, for example, or dupont? just doing some research on my own to look at popular dividend paying stocks. neither one of those were on your lists. >> the headline risk and political risk is too complicated. j&j's got a pristine balance sheet, brilliant management, but health care is not the flavor of the month, and it's just hard to see those stocks working until we find out what the obama administration's going to be doing on health care. >> mike, do you have an opinion on that as well? >> i think health care's going to be problematic, particularly with all the changes that are being proposed legislatively. but i love dupont. it's not on my list right now. but i love dupont. it's great. the the dividend is secure. well-run company. again, it's one of those companies poised to do extremely well when the economy turns. >> 5.1% dividend, which ain't bad, either, right? >> fantastic. >> let me ask you guys one more question. is it more important for investors to own dividend-paying stocks in a good market period

or a bad market period, or doesn't it matter? >> i don't necessarily think it matters. i think they should form the core of any portfolio, and then you can use the edges to participate in different market moves. if the market skies that it's going too begin to go up because the economy is improving rapidly, you're going to want to add some higher beta stocks to your portfolio, but dividend paying stocks in secure companies should be the core of any portfolio in any market. >> tim, do you have an opinion on that? do you agree with that strategy as well? >> pretty much. you know, if we were market timers, and we're not, then what history tells you is that going into a recession defensive stocks and income stocks yut perform coming out of a recession they will underperform for a bit, as defensive stocks did, for example, in 2002 and 2003. and as defensive stocks are doing now. over the cycle, however, i think the evidence is pretty clear, that income stocks will tend to outperform the broad equity markets. >> thanks so much for your time. good to see you both.

and let's get a check of the markets. the dow is still ahead by some 50 points or so. the nasdaq is in positive territory as well but off the best levels of the day. >> we're off the best levels for sure but still higher in the double digits. this year's first hurricane gaining some strength in the atlantic. up next we'll discuss whether the hurricane season will have any major impacts on the energy market this year. stay with us.

hurricane bill turning into a dangerous category 4 storm with winds reaching 135 miles per hour. weather channel meteorologist kevin robinson has the storm's latest developments. kevin? >> hi, scott and maria. and you're absolutely right. this may be a storm that's not finished strengthening either. here's a look behind me at a menacing and very powerful, dangerous category 4 storm. haven't seen one of these in a while. right now top winds holding at about 135 miles an hour. you can clearly see here from the infrared satellite picture the well-defined eye on this

system. impressive-looking structure with this storm, with the thunderstorms wrapped tightly around the center. this is one we're going to have to continue to monitor very closely heading into the weekend here. all right. here comes the good news and really the saving grace. there's going to be an unseasonably strong trough coming off the east coast, and that's basically what's going to help deflect bill from making any significant land impact here along the east coast. we're thinking bill's probably going to take that channel or waterway right between us and bermuda. now, that may spell bad news for bermuda in the long run. even though we will have a direct impact here in the lower 48 from bill, we don't think we're going to have any significant wind impact, there will be a wave issue this weekend anywhere from the coast of florida all the way up to maine. especially out on places like cape cod and then out toward cape hatteras. we'll have to watch very closely some dangerous and increasing wave height. i can't emphasize enough that folks who want to stay out of the water completely, you want

to stay off the jettees this weekend. you don't want to be anywhere where a big wave could catch you off guard and crash on shore. so be very careful. i mentioned the system may not be through strengthening. we could see winds top out at 145. and there's the track. it's not etched in stone, but this is a pretty good track right now for us and we'll keep a close eye on it into the weekend. maria? >> all right, kevin, thanks so much. joining us now to talk more about the storm season and the impact on energy is john kilduff, cnbc contributor and senior vice president and energy analyst with mf global. walter zimmerman is with us. chief technical analyst at united icap. nice to have you on the program. welcome. let's talk first about the impact of the hurricane season on oil and natural gas. what are your expectations? john. >> well, interestingly, maria-n terms of natural gas we diversified ourselves out of the gulf of mexico to a great degree. it used to be responsible for some 20% of our production. now it's down to 1 because of all the recent onshore activity that's gone on. but as kevin was pointing out, if that trough that he was

referring to breaks down and the hurricanes don't get deflected off into the atlantic ocean, the sea surface temperatures in the gulf are red hot again and that storm you just saw, we easily go to a category 5 if not bigger, if that's possible, and really menace our refining bread fact and our crude oil production. >> want to get your thoughts on the inventory story, which of course is the story of the day. but before we do, walter, your thoughts on the same issue. hurricane impact on energy in the coming six months. >> natural gas inventories are so high. and distillate inventories are so high. i have to think anybody long those commodities are going to be praying for a hurricane to try to restore some balance to a badly oversupplied market. this particular hurricane may be good news for east coast surfers, but we don't see it being good news for those long energy. >> all right. so john, you've got inventories high for the natural gas story, and yet today we get a report on crude oil and we see inventories

depleting that & that has oil prices right now up $3 a barrel. what's your take on inventory? >> yeah, i really stopped giving them a big weight in my calculus a long time ago now. i just think the economic story and the china story in particular, it's been underestimated in my view, their ability to suck up available stores of any of these products. so i think we go higher despite what we have on hand right now regardless. >> okay. as far as the china story is concerned, which of course has once again been brought up for debate, has china slowed down? are they still stockpiling commodities? >> i think that they have not stopped. if they go to slow down again, they'll rev up the loan programs and encourage their banks to keep the program going, keep the program alive. i think they're going to be with us for a long time. the demographics argue for increased consumption from them, not less. >> walter, what do you think? >> near-term if you look at the shanghai stock index it looks like a big bubble just burst. it's in a freefall.

and that does not bode well for those long the u.s. markets on the hope that china is going to bail us out. we see much more down side risk than up side potential here. in commodities and equities. and the only market that we see significant up side in is the u.s. dollar because we see there's a crushing wave of deflation ahead over the next couple of years that's going to boost the dollar up near parity with the euro, crush commodity prices, and beat down the stock market well below the march lows. >> and yet you've got people who are on the ground, walter, who say look, china is on fire, we're talking about 8%, 9% growth, back in action there. what do you base these figures on? where's the evidence that in fact we are going to see further upset in china from your standpoint? >> you look at what the shanghai index has done. since its highs its move down was completely consistent not with a bull market correction but with a first leg down of a larger sideline. and then the rebound in the

shanghai only corrected 38% of the larger decline, and now it's back in freefall. so it is the textbook perfect picture of a completed bear market correction and a longer-term down trend. >> let's talk about the impact of all of this, gentlemen. how do i invest in this scenario? john, what do i want to do in terms of commodities right here? >> well, i guess i have to disagree a bit with my friend walter. i just think the economic policies, the budgetary policies of the u.s. government are going to continue to pressure the dollar, cause inflation, not deflation, and i think you stay long commodities. you buy them. you buy gold here. it still looks good. >> you're going to buy oil, john, at 72.23 a barrel? >> i think oil's going to be at $100 a barrel before the end of the year, maria. >> oh, wow. walter, how do you invest in this environment? >> every single technical indicator and economic indicator that we are looking at is screaming deflation is the bigger risk. the cpi, the ppi, prices,

inventories, m-2 velocity. all these things say that inflation is impossible. everybody's expecting inflation, everybody's short the dollar. it's not breaking down. we think if you're long commodities the least have protective self-stops in and use any new highs to begin to scale out of length. >> what about that, john? deflation is an issue. we're still looking at a deleveraging situation. >> we've got a printing press that's on fire, maria. it's going to offset that. and again, these policy that's are in place, our budget deficit, everything. we're one bad treasury auction away from the dollar getting hit yet again. and this will all feed into higher commodity prices. but on top of that, particularly for energy, particularly for oil, you still have geopolitical worries out there. and look, i know $147 was off the charts last year. a structural situation. if we get anywhere near normal

economic activity we're back in the soup with the energy crisis. >> i guess that's what makes the market. thanks very much. we'll see you soon. >> a lot of that today, right? >> sure did. >> difference of opinion. as you said, that's what makes the market. coming up, one noted stock market watcher explains why he thinks equity investors should sit tight right now and why it may pay to cash in op currencies in the short term. we'll get hz picks and pans next. >> then after the bell former salomon brothers ceo john gutfreund gives his sense on how things have changed. back in a moment. you're the colon lady!

diarrhea, constipation, gas, bloating. that's me! can i tell you what a difference phillips' colon health has made? it's the probiotics. the good bacteria. that gets your colon back in balance. i'm good to go! phillips' colon health. others by the car of their dreams. during the lexus golden opportunity sales event, you can do both. special lease offers now available on the 2009 es 350.

and you know what, it works. nutrisystem for men: flexible new programs personalized to meet your goals. what's great about nutrisystem is you eat the foods you love and you lose weight. i'm dan marino. i lost 22 pounds on nutrisystem and i've kept it off for three years. for a limited time, get an extra three weeks of meals free! that's right, you can get an extra 21 breakfasts, lunches, dinners, desserts, and snacks. that's 105 meals free! i had awesome results. i mean, i lost 22 pounds, my goal was 20, it came off fast, and the food was great. it's what every guy's been waiting for: it's healthy weight loss and it's flexible. with prices as low as $12 a day, you'll save hundreds over other weight-loss programs. order now and get an extra three weeks of fantastic meals. that's right, 105 meals absolutely free. call or click now. guys, you can do this. just pick up the phone and call.

you will lose weight. let's go under the radar, check the stocks on the move tonight. furniture maker la-z-boy swinging to awn expected first quarter profit of $2 million. that's because it took fewer charges compared to a year earlier. the big cost cuts also helping to offset an 18% decline in sales. apparel maker perry ellis narrowed its second quarter loss. the company lost $5 million in the quarter. beating wall street expectations due to lower expenses. the company also says it expects

to return to profitability next year. and bakery goods company flowers foods report aid 27% increase in second quarter profits. the company made $30 million. it beat wall street estimates. the company is still lowering its full year revenue guidance due to slow consumer spending and increasing competition. and it's time now for the "fast money" final call. today's trader says equity investors should be sitting title but also says it may pay to cash in on currencies. let's get his take on all of that. dennis gartman is founder of "the gartman letter." dennis, good to see you today. >> scott, good to be here. >> where's the market going, dennis? >> which one? >> the stock market. >> the stock market is probably still going higher. i'm a little surprised by it. today's action was really quite shocking oerngs lower and then trading higher on the day, especially in light of the rapidly rising crude oil prices. every time i try to fight it it seems to ble up in my face. the trend seems to be up, doesn't it? >> everybody's saying the markets going lower. the traders we talked to on the floor want the market lower so we can get back in on some dips.

and the market won't go lower. >> it's really quite amazing. back in march nobody wanted to buy it. now everybody keeps wanting to try to sell it. smart guys, i think i'm a reasonably smart guy, smart guys try to sell it, next thing you know you've sold it short you run back in when it gets higher on the day, you say that didn't feel good, and it depends on what you're looking at but it depends on what you're looking at. the market seems to want to go up. >> don't you think some pullback is in order, though? >> it's been in order for quite a period of time. >> hasn't it? >> it really has. especially when you walk in in the morning. last night i got up at 1:00 to start writing the newsletter and i see china down 4%, 4 1/2%. our s&p futures are trading down ten points. you think we have to trade lower. we walk in, we do trade lower for a few minutes. one or two of the better stocks start to trade better on the day and the next thing you know everybody's running for cover. >> what do you make, though, dennis, of this pullback that we've seen in china, specifically the shanghai market? down 20% over the past two weeks alone. some folks saying that portends

bad things for-u china was first to rebound and now first to top out. >> well, the fellow who was on here just a few minutes ago said it ways think a 38% correction. those things happen. you did have a 100% run-up from the lows of last year, scott. i don't know about you, but 100% in seven or eight months is a relatively large move. the fact that you had given back 20% is not really all that shocking. i have my very serious doubts as to whether we'll get anywhere close to last november's lows in china or we'll get anywhere close to last march's lows here in the united states. >> commodities, then currencies. and look, it's an energy-led rally today. where do you think oil is going? john kilduff just on our air said he thinks oil's going to 100. where do you think it's going and what's your investment strategy as a result? >> i listen to john kilduff probably as much as i listen to anybody. he's very, very smart. and in the fund that i run we've actually put on some bullish trades in crude oil. we're long high beta crude stocks, and we're short the rather more boring ones. it's a bullish trade.

i've got to tell you, once we got above $70 i was surprised. especially in light of the continued large numbers of crude in storage other than last week's number that we got yesterday. you just have to be surprised by what's going on. nonetheless, it's china coming around, buying crude oil, buying natural gas, buying coal, buying energy wherever it can get its hands on. they are the taker. >> i thought china -- i thought they stopped stockpiling oil. >> china needs all the oil -- >> that's kind of a wry smile on my face. >> china needs all the energy it can get its hands on. it doesn't need to stockpile. it goes to angola and fixes five years of supply. it doesn't need to stockpile it. it goes to venezuela and buys five years of supply. it doesn't need to stockpile it. it goes to where supply can be made available to it long-term. the chinese have been out there very aggressively buying five

and six and ten and longer supply of crude, natural gas, coal, that kind of thing. if i were china, that's what i'd be doing. >> what about currencies? where do you think the dollar's going? just a week ago we were talking about perhaps a new paradigm for the dollar where it would strengthen on a recovery trade not a risk aversion. >> one would have thought -- last week it looked like the euro was a bit topee. it looked like the dollar was too terribly one-sided. you walk in this morning. it looks like 1.40's going to be given against the you're poep and the next thing i turn around and see it's trading 1.42. rather like the stock market. smart guys all try to get short of the dollar because they think everybody else has the wrong position on, and the dollar then goes exploding on the down side in the afternoon, comes rolling back in the morning in london, and then here in the united states gets beaten up again in the afternoon. it's very choppy, very difficult, and even the pros are having a hard time with it, scott. >> they sure are. >> dennis, thanks so much for joining us. we'll catch you soon. >> thanks, buddy, good to talk

to you. >> ahead on "fast money" today's bullish reversal and how to play it tomorrow. plus pete najarian gave gives his trader playbook. five years since it's gone public. the top-ranked internet analyst on the street tells you how to play google for the nievgs years. i guess we want to send it to darren rovell with some breaking news on the nfl. what have you got? >> the nfl owners meeting today in chicago, and they have approved a two-year extension for nbc. the 2012 and 2013 seasons for "sunday night football." the current deal allows the league to have 2012, 13rks and 14 all the deals done. cbs, fox, nbc will be 2013. espn also 2013. the directv deal runs through 2014. back to you. >> all right, darren. thanks very much. we're approaching the close here. nine minutes before the bell sounds for the day, dow industrials up now 57 points. >> the dvd distribution battle

between hol sxwood popular company redbox is getting even bigger. chef's meal with pommes frites perhaps a night at the theater with extra special seats additional hotel night, our treat you world in perfect harmony: priceless look for world on your mastercard to get rewards and offers that matter to you. tdd#: 1-800-345-2550 if i'm breathing, i'm thinking about trading. tdd#: 1-800-345-2550 i always have my eye out for a stock on the move. tdd#: 1-800-345-2550 doesn't matter if a company sells computer chips tdd#: 1-800-345-2550 or, i don't know, fish and chips. tdd#: 1-800-345-2550 i'll look at all kinds of stocks before i settle on one. tdd#: 1-800-345-2550 if i think i'm onto something i'll check it out, tdd#: 1-800-345-2550 you know, see what other traders are up to. tdd#: 1-800-345-2550 when everything feels right though, tdd#: 1-800-345-2550 that's when i get serious.

tdd#: 1-800-345-2550 and the minute i get into something, tdd#: 1-800-345-2550 i already know when i want to get out. tdd#: 1-800-345-2550 of course, every now and then i'll talk with somebody tdd#: 1-800-345-2550 who knows what i'm trying to do. tdd#: 1-800-345-2550 (announcer) switch to schwab today. tdd#: 1-800-345-2550 you'll get the tools, the technology tdd#: 1-800-345-2550 and the support to trade your way. tdd#: 1-800-345-2550 go to schwab.com/trader tdd#: 1-800-345-2550 or call 1-800-540-7304 tdd#: 1-800-345-2550 right now. tdd#: 1-800-345-2550 but opportunities can vanish like that... tdd#: 1-800-345-2550 ...so most days, i'm right there tdd#: 1-800-345-2550 when the market opens.

welcome back. dvd rental company redbox is suing universal and 20th century fox and now you can add another

hollywood studio to the mix. cnbc's jewel qua boorstin is in los angeles with the details. julia? >> that's right, maria. coinstar's redbox is now suing warner brothers because the biggest dvd business in the industry because warner's is banning redbox from ent renting its dvds for 28 days after they go on sale. this is part of an ongoing battle. redbox which operates kiosks renting movies for a dollar, and the movie companies. redbox, which is owned by coinstar, has sued 2th century fox and universal over the same issue just as monday a federal court ruling it would proceed with redbox's antitrust claims against universal. time warner is surely looking to prevent cheap rentals from undercutting its dvd sales which have held up better than its rivals'. they're also concerned about redbox selling previously viewed dvds at a bargain price as home video revenue, bolstered by films like batman and "harry potter" contributes some 20% of the company's revenue.

>> films that time warner make i would argue are more apt to be owned rather than rented. so i think for them the important point is protecting their car sell thru business is perhaps the most paramount. >> meanwhile, redbox has given sony and lions gate premiums in order to secure their dvds for rental. redbox accuses warner's of copyright misuse, violating antitrust laws, and interfering with redbox's existing supply contract with distributors. maria, in order to succeed, redbox is probably going to have to show evidence of an industrywide conspiracy, which could be quite tough. so we could be garnlted that this will drag out for quite a while. back over to you. >> julia, thanks so much. julia boorstin. the dow up 60 points. >> after the bell we'll reveal the number one fastest growing company by rank. that's "fortune" magazine. that's coming up in the next hour of "the closing bell." introducing one a day women's 2o.

the first complete women's multivitamin in a drink mix. with more calcium and vitamin d... to support bone and breast health... while helping you hydrate. one a day women's 2o. refreshingly healthy. what's on the minds of independent investors? let's ask. when i trade, i want a straightforward price. they lure you in with a $5.99 trade, then charge you 15 bucks. you get a low price, but only if you make a ton of trades. at td ameritrade, every online stock trade is just $9.99. period. no matter how often you trade. no matter how much money you have in the account. i hate those hidden fees buried in the fine print. surprise! it's a maintenance fee! i hate surprises. at td ameritrade, you never pay a maintenance fee.

you get low, straightforward pricing, so you always know exactly what you're paying. hey, that works for me. are you ready to declare your independence? independence is the spirit that drives america's most successful investors. announcer: trade commission-free for 30 days plus get $100 cash when you open an account. okay. welcome back to the floor of the new york stock exchange. time now for the closing countdown. what a resilient stock market we're dealing with here. the dow jones industrial average going to go out up about 60 points. technology doing fairly well today. but this is an energy story. all this on a day where warren

buffett has his op-ed in the "new york times" about those side effects. so everything we've done to the economy -- there's the bell. and "the closing bell" continues. and it is 4:00 on wall street. do you know where your money is? hi, everybody. welcome back to "the closing bell." i'm maria bartiromo on the floor of the new york stock exchange. and here's what we're following at the close tonight. the rally extends for a second straight day. today led in large part by the energy sector. oil up big. the oil producers following suit. a larger than expected drop in weekly oil inventories. the reason pushing crude oil prices up by nearly 5% on the session. finishing the day at 72.42 a barrel. and swiss bank ubs will divulge the names of more than 4,000 americans with secret bank accounts to the irs under a settlement with the u.s. authorities. take a look at how we finished

the day on wall street where we saw a final push today with the dow jones industrial average finishing back above the 9,279 level with a gain of 62 points. about 2/3 of 1%. as you can see there. nasdaq also strong, extending the rally yesterday. 1,969 the last trade on the nasdaq way gain of 13 points. and the s&p 500 thanks to that rally in oil up 3/4 of 1% at 996. bob pisani our eye on the floor of the nyse, what's the latest behind this move? >> once again stocks had a great opportunity to go down. we saw that weakness in china. they refused to do it again. monday we had a big down day, and folks, that's basically it. >> there's a debate about the slowdown going on in china. a lot of people feel that things are quite vibrant, thank you very much, on the ground in china. >> and there's a lot of discussion about where some of that lending money has gone in china. some of it's gone in the stock market and maybe the pullback in lending means the stock market will pullback. maybe fundamentally things are good