>> i have an 8-year-old daughter. i'm already saving for the prom. it's a 517c. that's a false story except i have an 8-year-old daughter. thankfully she'll never go to prom. >> thanks for watching. "closing bell" is next. hi, everybody. happy friday. welcome to the "closing bell." i'm maria bartiromo with the new york stock he can change. >> and i'm bill griffeth. happy friday the 13th. >> that's right. >> the bulls are spooked on this last day of the week. financials leading the markets lower for a second straight week despite better than expected earnings for the likes of jpmorgan chase and wells fargo. what you had was weaker than expected growth numbers from china and a continued rise in spanish. all continuing concerns about a global slow down. we're not trading on our own

fundamentals. should you avoid risk-on assets? we have the angle for you coming up. also, we're looking at the banks and mortgages, timothy sloan from wells fargo will be here. first, let's take a look at where we stand as we approach this final stretch. down 71 points. not the lows, certainly off of the worst levels. double digit loss. nasdaq now being sold today, down 36 points. better than 1% to 3,019. with the decline in the session about 11 points, 1376, last trade there. less than an hour to go in the trading day. china, of course, front and center remaining a focal point for investors as fears of a hard landing continue to weigh on sentiment. henry mcva is not a bull on

china but does not see china collapsing. we'll get more of his comments and how to invest in china and get a piece of that growth. oil, mining, financials under pressure today. better than expected earnings as well as wells fargo. not doing much for those stocks today. more on the clues of the health of the banking sector. we've also got goldman sachs on tuesday. a big week for earning coming up. traders keeping an eye on technology. poised to snap a record weekly win today with decline in the tech sector. all 10 of the s&p sectors are done for the week, including technology, down better than 1%. i.t. had been up 14 weeks in a row. that's where the money has been going. clearly, bill, in technology among other areas. >> what's the best performing sector this week? i won't tell you just now but it might surprise you. it did me. coming up, another item on the docket today, comments from fed

chairman ben bernanke. he spoke at the princeton club here in new york. he didn't say anything about monetary policy but offered an interesting view on monetary and housing. why lower rates caused the housing bubble in his words were pretty weak. take a listen. >> the magnitude of the movements in short-term interest rates in the early 2000s, when you translate them into monthly payments. >> let's go to bob pisani. if it's friday, it's gary kominski. good to see you. >> good to see you. >> what was wrong with the financials? i guess they got caught -- >> i was happen people the key things we're looking for, mortgage activity, trading activity. trading activity was up and wells fargo, do you know, almost

30% of the mortgages in the united states are originated by wells fargo today? their mortgage activity was up 7.5% increase in loans. that was a tremendous number. i think what the street did not like and the reason we're seeing some of these financials down, you go to the traditional banking activity, that is loans. the loan business is still weak. we're not seeing any focus on the trading activity, not the focus on the mortgage business being better but traditional banking activity is still weak. that's, by the way, why we're getting the reasonable bank to weak. these guys, wells fargo, have got trading operations. jpmorgan has trading operations. they have nothing to fall back on, for example. >> when you think about the and on this anticipation of a bounce

back, what we're seeing is normal. it makes sense. you can't have the type of outperformance, relative outperformance that we had and then expect exceeding, blowout type guidance. as you and i discussed, the mortgage issues that many had hoped, let's go back six months ago, they had hoped that by early 2012 we would not continue to be talking about it and unfortunately we are. >> the mending process is going to take a while. >> the reserves that jpmorgan announced in terms of the potential litigation, that does have ramifications. there will be concern over the weekend in terms of what we see next week. >> spanish yields, here we go again. we've seen this movie already. up to levels -- i don't want to minimize the importance of the story itself. but the safety nets that the european officials have put in place are far better now than they were during the greek crisis.

>> you follow this as close -- i mean, look at where the cds closed the week. the spanish banks are trading at their march 2009 loans and so we have not had the fear in 2012 in the u.s. equity mark debts on a daily basis that we had late last year. something sort has got to give here. we cannot continue to see the moveup. >> the question is, does it affect the u.s. economy? we've heard fed officials this week. we hear from ceos who are involved overseas. they don't believe that a debt crisis of that magnitude -- and i'm talking about the spanish debt yields going higher right now, will affect the u.s. economy that much. >> no. but if it creates a collapse of the financial institution because of the interconnectivity -- by the way, you listened to bob bernanke. he says, low interest rate had nothing to do with the housing bubble.

>> caused by complexities. >> didn't low interest rates create the boom in securitization which caused the problems in the housing market? >> and made it possible for people to go buy secondary homes on a cheap basis. >> so the correlation between the direct and nondirect. >> and some people taking a loan that had no business taking a loan. by the way, before we go, did you see bob pisani's shoes today? >> there you go. >> i have never -- bob pisani is the only guy that can pull off a pair of shoes like that. >> these are stress leather and it's very hard to find a green cow. there is very few green cows in the world. and i would bring out my blue pair. >> absolutely beautiful. >> thank you for bringing that up. >> glad to have you along. >> see you in a bit. >> investors are pouring money, meanwhile, into treasuries amid concerns of the gdp out as well as the european crisis. let's go to rick santelli who is

in chicago. >> wearing sneakers, by the way. >> if you look at a 24-hour chart of the ten-year yield, it wasn't until we really started to see the traders come close in our time zone. you can see how interest rates responded. then you threw in our data and even though the inflation data was as expected, it will be a bit hotter. it didn't seem to make a difference. a one-week chart is interesting. closing down a dozen basis points on the week. it looks that way at 199. if you look at a one-week chart of the boone, you can see a similar dynamic but they are unchanged albeit a low week. two days ago, midweek, they closed at 164 yield all-time record low yield. if you draw in the dollar index, granted that today when you had a risk off day, it's up. yesterday it was down on the week it's virtually unchanged around 79 7/8.

a whisker under that. this is a ten year of the spanish maturity. and we can see it's up about 22 basis points on the week. once again, flirting with that kind of nervous 6% level. maria, bill, back to you. >> thank you very much. as we head towards the close, about 50 minutes left on a relatively low volume day, we were just told, perhaps of the week. first one of the week. the lowest of the week. dow down 69 points. off the lows right now. >> it was mortgage income which helped wells fargo. first quarter earnings moved higher. wells fargo cfo tim sloan weighing in next. >> should you buy shares of citigroup ahead of the earnings report on monday? we'll take the talking numbers trade coming up. and then there's only two certainties in life. death and taxes. funeral and taxes related stocks good investments? we'll take a look at those coming up. we should the so-called

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welcome back to the "closing bell." a little over 45 minutes left in the trading session. if you're just joining us, here's what has been happening today. we're coming off the lows of the session as we do a stat check. the financials have been leading to the downside so far today despite better than expected earnings with jpmorgan and wells fargo. technology and energy stocks have been weak today. here are some of the biggest losers among the financials. e-trade, first horizon, morgan stanley and bank of america all down sharply. no 13,400 for the dow today. it's been stuck off the lows

down about half a percent or 63 points at 12,922. we are on track, though, for the second consecutive down week for the industrial average. maria? >> bill, thanks so much. shares of wells far go down today despite earnings that beat expectations. profit was up 13%. revenue up 6.4%. on an increase in mortgage banking business. the bulk of the business, they are coming from refinancing. analysts are worried that expenses at the largest mortgage lender are not falling enough. joining me to talk about the results in a first on cnbc interview is wells fargo's ceo tim sloan. good to have you on the program. >> thank you. nice to be here. >> this seems to be one of the concerns on the part of investors. you had had higher expenses in terms of personnel costs related to mortgage banking as well as higher legal reserves. how can you offset some of that increase that we're seeing in expense at the bank? >> well, we have forecasted our

expenses. we're going to be elevated this quarter in the way that we were able to offset it is having higher revenueses. revenues were up a billion dollars. our expenses were up $484. revenues were up a billion three year over year and expenses up only $260 billion. we feel very confident about the ability to reduce our expenses. this was our last quarter. first quarter that we had the wachovia integration. those expenses are falling away. about $500 million of the expenses in the first quarter were seasonal that will go away after the first quarter. >> so you think expenses in the next quarter, then, will be a lot lower? >> we do, maria. in fact, we provided guidance last quarter as well as this morning that we believe our expenses will be down between 5 to $700 million in the second quarter. >> let me ask you about some of the legal reserves as well as

the higher fees as a result of the new regulatory environment. what can you tell me about that in terms of change and what you are expecting given the new normal of the regulation. >> yeah. there's been a lot of regulatory changes that have occurred in the industry. you know, as you know, we just celebrated 160th birthday and we've been in the business for a long time. it's always been a regulated industry. what we need to do is take the change in the regulations, some of what which we and gri with and some of which we don't to make sure it doesn't impact the customers by continuing to have a more efficient operation and provide them with good products and services. >> let me move on to the mortgage business. you saw a big spike in applications in the quarter. what does that say about the housing market right now? what can you tell us about the mortgage business? what are you seeing? >> the mortgage business is a great business for us. we love the business. we had at the end of the fourth quarter about a third of the market. our pipeline started the second

quarter, higher than we did in the first quarter by $7 billion. it was $79 billion. the. drans of mortgage volume right now, about three-quarters for us in the first quarter was refinance volume, which is a great thing. we like the business. having said that, it's a cyclical business and so we know it's going to come down somewhat over time. the heart program made up about 15% of our volume in the first quarter and we expect that to continue for a while. >> do you expect housing to bottom? >> maria, i don't know. clearly the housing market is a little better than it was a year ago. it feels like we're getting near the bottom or skating along the bottom. i don't think we'll know for sure until we look in a rearview mirror. >> what can you tell the consumer, then? you had foreclosure filings up from the previous month for a third straight increase. what are you seeing on the foreclosure front? >> well, i think the consumer,

to your question, is under some stress. but it's primarily those consumers that are unemployed. that's the biggest problem we have in the economy today. the rest of the consumers are doing okay from our perspective. we see good volume in our auto business, for example. we had record renovations, student lending was good. credit cards were down a little bit but that's more seasonal than anything. more importantly, our credit quality was up to indicate that the consumer is doing better. >> feeling like they are in better shape. capital markets, tim, any thoughts there? volume seems to be so week weak and there's still a little bit of fear out there and risk averse tea. >> there is. we've been through the great recession. there were a lot of losses taken within the try industry. we like our capital market business.

it's a grade edition to our business model and something we expanded when we acquired wachovia. we like the business and we'll continue to grow it but we're going to do it in a risk appropriate way as we run all of our business historically. >> what kind of year are you expecting for 2012? >> we're not very good at providing guidance. we entered into the second quarter with a strong platform and also through acquisition we mentioned on the call that we're going to be closing the acquisition of north american lending business this month. so we're excited about that. >> we'll leave it it there. tim, thank you so much for your time today. >> thank you, maria. >> tim sloan is the ceo of wells fargo. bill? the dow is down 23 points.

>> we'll take a look at citigroup in talking numbers. also, kkr's henry mcvey explains why he's betting high on real estate. that's at 4:00. as we head to a break, the dow jones industrial average is down 63 points. back in a moment. nergy. the world needs more energy. where's it going to come from? ♪ that's why right here, in australia, chevron is building one of the biggest natural gas projects in the world. enough power for a city the size of singapore for 50 years. what's it going to do to the planet? natural gas is the cleanest conventional fuel there is. we've got to be smart about this. it's a smart way to go. ♪ that could adapt to changing road conditions. one that continually monitors and corrects for wheel slip. we imagined a vehicle that can increase emergency braking power

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oil under presh today but a little higher after the close as traders look ahead to the nuclear talks, the iran nuclear program talks this weekend. even as brent outperformed, it was the big loser. a number of folks looking at a shift. meantime, the headline of the week certainly has to be nat gas, closing at a ten-year low, holding shy of 196. it's really not clear where the bottom is here. >> not yet. although you can't, as they say, break your arm falling out of a one-story building, right? thank you, bertha. let's head towards the close. about 35 minutes to go here? time for talking numbers. focusing on the financials and specifically citigroup down 3%.

the financials are leading to the downside, as i said. citigroup announcing its earnings on monday. do you buy it or sell it ahead of that time? joining us is abigail and citigroup rolled over. we know the financials have been strong but citigroup rolled over after the stress results came out and they failed them and we're not allowed to issue a dividend. what did that do to the chart here? >> it's destroyed the chart and probably makes sense to take profits. citigroup is reversing its trend line. all of this on a bear penant. they have started to confirm today if it drops below 33, we had like to see that on a closing basis. if it drops below 33, it carry as target of 28, 29. it probably makes sense to take profits in citigroup on this bear penant and these other bear signals.

>> does that go for the whole financial sector? >> it actually does, bill. if we look at a similar chart, it's breached the trend line and is above the moving average. this pattern carries a target of 14 confirms at 15. if it drops below a 50-day moving average and then 15, it's very likely that we're looking at 5% plus decline on the days and weeks ahead. the financial sector may take a tumble. >> and this has been the leadership sector so far this year? >> yes. it will cool off a little bit here. >> all right. abigail, thank you. >> thank you. bill, thank you so much. 35 minutes until the "closing bell" sounds for the day. the market is down 67 points. nasdaq down 31. s&p down ten points. the best two-day rally of the year. investors heading back to the

side lines? >> plus, big headlines for the video game industry on the way. >> the video game industry continues to tank with the fourth consecutive month of major declines. so is there an investment opportunity in these dips or is it game over? i'll have that story later on the "closing bell." >> anden an intriguing story of politics and murder, will that impact the country's future? details in the next hour of the "closing bell." as we take a break at each sector and how it's fairing, as you can see, discretionaries and consumer staples doing best today. back in a moment. tdd# 1-800-345-2550 the 5-day moving average just crossed above the 20. tdd# 1-800-345-2550 we're hitting new highs. tdd# 1-800-345-2550 the spx is on my radar. tdd# 1-800-345-2550 and i'm on top of it all with charles schwab. tdd# 1-800-345-2550

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welcome back. bob pisani on the floor of the new york stock exchange.

steady for the week. moderate volume. regional banks notably weak. jpmorgan and wells fargo. good numbers, good mortgage activity and trading activity. unfortunately, these other forms of traditional lending faired to middling. that's a concern for the regional banks and how their reports might do. home improvement stocks, though, doing well. new highs for the famous names. sherwin-williams had positive comments. bill and maria, back to you. >> right now the s&p 500 are on the biggest declines of the years a the markets paired back the gains and there are underperforming sectors. among his topics, technology, staples, and utilities. >> let's bring in chief economist from jpmorgan private

wealth management. nice to see you. >> nice to see you. anybody who thinks they are having a bad day today. on this day 36 years ago, ronald wayne owned 10% of apple computers and he told his 10% share for $800. >> ouch. >> anybody who thinks they are having a bad day. >> and how much would it be worth today? >> it would be worth of 10% of 600 billion, 60 billion. >> and you still love apple? >> we love apple. >> technology, 720 is the target. new money is put to work right here? >> yes, we would. qualcomm, the platform for apple, samsung, the android phone, maria. you want to own these companies that have staying power. ibm, intel, that as well we like. we would see the drugs as another place to put some money to work here with this, a little bit more -- you're going to see slowing next week with the industrial production. you're going to see philly fed, empire state and manufacturing

and you're going to see the leading indicators. very sloppy next week, we think. so put some money to work in the defense for a while. >> anthony, there's always something to worry about but this week we've been worrying about higher spanish bond yields, slower growth in china. do you feel that will affect our own economy and therefore, our markets? >> by definition, we're in a globalized environment. if europe is having problems, china is having problems, it's going to have an impact on the united states. the good news is, things are actually showing some signs of potential improvement. i think the european central bank is engaged, imf is engaged. in china, yes, we did see the numbers coming in weaker but the more forward looking numbers are suggesting that as you look forward to the second quarter, things are going to improve. >> so let me ask you about china. we have the gdp numbers out from china last night. and it was lower than expected. 8.1% growth.

that is a pretty good growth, right? what did you think of the china numbers and how that has impacted the rest of the world given that china has been the engine of growth for the world? >> you have to look at everything. 8.1% is not bad but when you look at the retail sales, production numbers in china, loan growth in china, all of those are encouraging and suggesting to me that the first quarter is probably going to be the low point in terms of real gdp growth. for the year as a whole, we're looking at 8.3, 8.4% economic growth for china, which is not bad given that the earlier guidance was 7.5 to 8%. guess what, they will probably beat that guidance. >> you got my attention when you said that you like utilities. defensive play? can you reconcile that when you like technology? >> they do tell different stories. it's underperformed significantly here. utilities are down 3, 4%. tech stocks are up 18, 20% on the year. you've got three things.

anthony hinted at this and explained it. you're going to have china hitting the accelerator in the second quarter with the slower growth. so get ready for the authorities to hit the accelerator there. secondly, if the spanish bond situation gets worse, getting close to 6%, you very very would see the european central bank do something. and, finally, the worst things get here, if it slows here, you've got a qe 3, quantitative easing 3 or some sort of an operation twist. so the worst things get, bill, on a short-term basis, the better things might -- the response would be from the authorities. i think that's where anthony and i agree. >> i guess i want to look at other asset classes here. what about oil, some commodities that really have been coming down recently as money shifts. gold, you still want to have exposure to those kinds of assets? >> great point, maria. you want to have some bar bell exposure to some of these other asset classes driven not by

interest rates, not by profits. you want things driven by supply and demand. oil came off, which is actually a good thing. gas is at $3.92 a gallon. it's up 22% for the year. >> still too high. >> still too high. but oil as eased off of the high investor numbers and they seem like the oil prices ease off. and that would be another form of stimulus, maria, which would be short term good for the markets. >> he's looking for income from the utilities. but yields came off the treasuries. even with your view that the economy is continuing to improve. do you see yields going higher or lower? >> i think we're looking for yields to move gradually higher as the economy improves. but keep in mind, i'm on the same page as david. you should have exposure to gold. there's been a lot of liquidity thrown out. the big question is will central banks pull that liquidity?

we think they will. not a bad idea. >> very good. anthony chen, have a good weekend. >> thank you. the dow is starting to move lower. so much for this floating higher. we're down 95 points, getting close to the lows again. >> of course, ben bernanke gave a speak etchier on the lessons learned from the financial crisis. we'll get reaction to that coming up next. are funeral and tax-related stocks a good addition to your portfolio? >> speaking of death and taxes, should the so-called death tax be killed off? send a tweet to @cnbc"closing bell" and @mariabartiromo. what do you think bill? tax or no tax? >> let it go. we'll find revenue somewhere else. >> tell us what you think. back in a moment. >> announcer: but, first, before we go to break, the dividend. which stock is this year's

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>> announcer: just before the break as part of "the dividend," we asked which stock is this year's outperformer? coca-cola, dean foods, or kellogg. kellogg, which is up 5% year to date. i'm seema mody. tech stocks are down better snapping the 12-week winning streak. we're seeing the tech sector under pressure. apple accounting for 22% of the s&p 500 tech sector and 18% of the nasdaq 100. bill and maria, back to you. >> thank you so much, seema. 20 minutes left before the "closing bell" sounds for the day and the week. the volatility index climbing back towards 20 right now.

check out the vix as we can see it. it's at 1937. the vix is moving higher as stocks drop. renewed concerns about the borrowing costs. as well we have the china gdp. it was 8.1%. good number but a little less than people were expecting. the dollar expecting the the gains against major currencies as the debt story continues. yields rising to highs today in spain. u.s. stocks along with the nasdaq off the worst levels of the session. nasdaq down 38 points on pace for the second week in a row of declines for the nasdaq. still talking about double digit gains year to date though, bill. >> yes, so far. bill bernanke gave a speech on the lessons learned from the financial crisis. he said the fed must increase the focus on achieving financial stability. steve liesman is there at the princeton club in new york with a special guest. steve? >> reporter: bill, thank you very much.

i'm here with the m.i.t. as the leaders on the financial crisis in part because you are the guy known as the reader of 21 books and you wrote this paper that summarized the findings of 21 books on the financial crisis. share with us what you found. did anyone get it right? >> the short answer is no. not that they got it wrong but each of the 21 authors had a piece of the puzzle but they didn't have the whole thing. >> how close are we to understanding what happened in the financial crisis and the lead up to it? >> you know, i would say we're in the second or third earning of this nine-inning stretch where we have to spend a lot more time doing research and sift through the wreckage. >> what's the biggest myth, in your opinion? >> well, there are a number of them. one of the myths is that there was a lot of excess risk taking by people who didn't have enough skin in the game. what we're finding is when you look at this, people had quite a lot of skin in the game and lost

that skin along with their flesh. >> so it's not executive compensation. >> it may not be that alone. there may be elements that con pr tributed. >> what's the other myth that you found? >> well, that it was a lot of predatory lending and that borrowers were taken to the cleaners. borrowers were a lot more sophisticated than people gave them credit for. >> does it strike you as strange that the government seems to have made up their mind about what caused the financial crisis and how to fix it, given that they've already passed dodd frank? >> well, that is a little strange. it's understandable because it was a reaction. it was like fire, ready, aim. we will figure out what we want to keep and what will be changed. >> when you look at the existing dodd-frank law, what should stay and what do you think should go? >> one of the most important aspects of dodd-frank was the

creation of the office of financial research and to figure out what happened, how it happened and what we might do to prevent it from happening again. that's something that should definitely stay. in terms of what should go, at this point it's actually hard to say because a lot of dodd-frank is not yet implemented. the volcker rule and probably not amaria, i welcome this to anybody that wants to go online. a great survey of the existing literature out there. by the way, he's complementary of the books written by journalists. >> all right. that's good. >> we like him. >> steve, thank you so much. steve liesman. 15 minutes before the trading day closes. the dow inching towards the worst at 99 points. video games are suffering in sales but is there a real bright spot out there for this

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welcome back to the program. here on the floor of the nyse. sony is plummeting to a two-month low after the new ceo fails to impress investors. mark, what are you seeing in terms of volume on sony? >> it's actually more than double the average. the average is 1.46 million. we're trading 3.2 million. >> so almost double the volume on sony. really heavy volume. the stock has declined about 10% this week alone. let's take a look at where we are on the shares. to recover from four years of losses. sony says it will focus a lot more going forward to win those

customers back from apple. they are focusing on mobile devices, games, and digital imaging. that's where the priority is going to be. the company says it's scaling down the tv models and slashing $ 10,000 jobs worldwide. sony taking the one-time charge of $926 million this year to put all of those changes in play. sony, phillips, and panasonic have been losing ground over the last 52 weeks and apple has shot up 80% in that same time frame. a sign of the times. bill, back to you. >> as we head towards the close, they are leaning towards the buy side mainly with the financials and basic materials but we are heading lower overall. the selling is intensifying as we head towards the close. video game sales are reeling after four straight months of decline but it's not all bad news for the industry. julia boorstin plays up the

silver lining. >> there is a silver lining but let me get to the bad news. the industry is falling off the cliff. sales down 25% in march to $1.1 billion. it's the fourth consecutive monthly decline. consoles suffered most, down 35%. software dropped 25% and accessories fell just 8%. but here comes the silver lining. spending on apps, social games, digital downloads, that accounted for 2.5 billion plus for spending in the first quarter. these companies like zynga and angry birds and rovio who wants to go public in hong kong this year. with zynga up 18%, pacific crest warns that it's overvalued. >> zynga is not growing that fast. the forecast was for 25% bookings growth. secondarily, we think that the

cost basis that zynga has to support with 3,000 developers already and growing is that they will never have margins like those other companies. >> wilson has overperformed ratings and he believes they will be able to transition from physical to digital. the giants electronic arts rating to outperform. he's betting not on digital prospects and it doesn't hurt that they've outperformed the market so far this year. >> julia, thank you so much. now that the weather is starting to warm up, our next guest is focusing from free port mcmore ran. brian? >> hi, bill. thanks for having me here. when you talk about freeport-mcmoran, stocks have struggled to the rest of the broad market and they sort of trade hand in hand. it's a stock here that i want to

own fex but i have to be careful, and wonder if freeport can continue to move higher. i love this stock and that's a level that i'm looking to get in at and add protection by selling a call against my long stock. so what do i do? i sell the may 39 call ahead of its earnings play next week and collect about $1.10. now what i've done is lower my breakeven from 3620 up to 39. that's an area that i make a nice little return over the next month. a stock i want to own but add a little protection. before you go on, copper's where you want to be, fex is the name. now back to you. >> brian, thank you very much. catch more options action at 5:00 p.m. eastern followed by money in motion at 5:30 p.m. eastern time. we'll take a break and come back with the closing countdown. also, the battle over

breakfast is heating up. >> i'm darren rovell. we're going to tell you why the quick service restaurant category is scrambling to sell you your breakfast. that's coming up on the "closing bell." also ahead, find out why facebook's upcoming ipo could be a major road block in the sell and may go away strategy. as we head to a break, here's how we are trading just before the end of the day. we're heading back to the lows of the session. financials leading the way, once again. back after this. [ male announcer ] this... is the at&t network.

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okay. we are inside the four-minute marker. give me one second. you dropped this, maria. there you go. gary kominski here. >> yes. >> what happened? >> we looked like we were staging a bit of a rally and if we look at the xlf --

>> we can't right now. >> it the dow turned us back down here. the financials had such a great early part of 2012. that was the leadership. that created a leadership and real technical levels on the s&p. >> we're in the midst of reporting seasons. >> correct. >> wells fargo, jpmorgan, the numbers were not great but they were okay. is that what this is about right now or are we looking at just the thought that if the economy is going to slow down, this is a group that is highly vulnerable. >> there was a huge expectation built into this. and i think that today's numbers did not give anybody reasons to start bidding up these stocks further. it's as simple as that. >> you know, what was interesting and our chart system is down for a moment here but i can show you, utilities were among the best performing

sectors this week. the prime hedging group. the defensive group out there. >> sensitivity. >> rates went down, utilities did well. do you think that's going to last for a while? >> that depends on what your outlook is as far as interest rates. >> well, i'm asking you. >> i told somebody earlier today, when you listen to all of the fed speak this week, we look at earnings, it's hard to think that interest rates -- and we benchmark the ten-year there, that they are going to have a dramatic move. i know we can't show the intraweek chart but this was a volatile week on the s&p. monday, tuesday, wednesday, thursday into the rallies and then what we've had today. we haven't seen this year yet. >> correct. >> it's going to be a concern -- >> we knew it eventually. >> it's going to be of some concern given the bounce seeness that we've had this week. that's something to worry about this week. >> the fact that -- it would seem, the headlines we're

trading on has nothing to do with our fundamentals. it's more about the overseas. what does that tell you about the market right now? >> we're trading on -- it's a confusing time. just look at this week. why did europe matter in the middle of the week and matter at the end of the week but didn't seem to matter the last couple of days? it's a very difficult environment. >> exactly. my point. >> and what's going to be on monday, we've pointed out in terms of what happened at the close, something to pay attention to. >> so a lot of -- i don't want to get too wonky about it, short-term that can be a bearish note here? >> i will simply just tell you the best s&p trader i know tells me a few minutes before we come on air, the level is now at 1327 on the s&p given where we've gone at the end of the day. >> so he would see it moving lower? >> 1327 is the new target now. >> gary, thank you, my friend. i'll see you. have a good weekend. that's the first hour of the "closing bell." as we head towards the cl