questions. get started at legalzoom.com today. and now you're protected. we're not down triple digits but down 87 points right now on the dow. >> thanks for watching "street signs." "closing bell" is coming up next. hi, everybody. happy monday to you. welcome to "closing bell." i'm maria bartiromo at the new york stock exchange. tough day on wall street once again. the market extending big losses from friday. more lackluster earnings to blame. >> to put it in perspective since alcoa kicked off earning season two weeks ago, the dow is down 2.5% right now. so is the s&p. the biggest loser, the nasdaq which is down roughly 4% since alcoa reported. >> that had been the leadership on the upside.

low hanging fruit. it could get a lot worse because only about a quarter of the companies on the s&p 500 have reported their earnings so far. how do you navigate the choppy waters? we'll talk strategy later on in the program. let's look at where we stand as we approach the final stretch. down 83 points, two-thirds of 1% sitting at 13, 260. nasdaq getting hard hit. down about 3.75 points. it has bounced off the lows which happened at 2:00 p.m. eastern time with a fractional decline on nasdaq as we approach the final hour. s&p down two-thirds of 1%. that's nine points lower. >> we're not finished. will the bad news continue? what does it do for the markets? joining us with their perspectives on "closing bell" here today, danielle hughes and bob pisani will join us later by matthew lloyd. danny what do you make of the earnings so far?

there have been high profile disappointments that have taken the wind out of the markets. >> there have. this week we have 155 companies reporting the in the s&p. it will be a crazy week. some of the companies that have reported like google down 11% since the beginning of this quarter. ibm down 8%, 3% for the year. intel down 6%. down 10% for the year and microsoft down 5% up only 4% for the year. >> you should mention technology. >> it's technology. you have facebook reporting down 13% for the quarter. down 50% since its ipo. you have apple down 5% for the quarter. up 55% for the year. >> these numbers are stunning really. when you look at what's going on in terms of earnings right now, is something slowing down a bit more within technology versus the other sectors or is this a global economy story? >> it's more of a global economy story. the big story is not only missing earnings but missing

revenues. until last week we had earnings slightly above increasing but the revenues are down almost 1% about 67 basis points. 68. earnings are coming from margin costs. cost cutting. that's even more concerning. >> which industry looks poised to grow fastest? give us the leaders and laggers here for the third quarter. >> for right now we don't have the breakdown for revenues since we're looking at one quarter a little farther in. for us it's always about stable earners. those companies that are able to consistently give the dividends and earnings and the companies that haven't been hit the hardest are those that are more volatile like google, ipos, technology companies. >> bob pisani was about caterpillar this morning. the company there saying they are seeing a slowdown and that is what took the market down this morning. >> 2013 they talkeded abo eed a revenues being flat. that wasn't in the guidance before then and now it is and yet the stock has held up very well. that makes me hopeful cat pi

caterpillar is finding a bottom. this is one of the toughest quarters to call. the ladies would agree with me. europe is weak but not clear how much weaker it will get. china bottoming some. hoping the political leadership will turn attention to helping the economy after the political situation settles itself in november. i think the big hope here is the u.s. consumer is doing better than people anticipated, wouldn't you agree? >> riddle me this. if caterpillar warns and sends it lower, why is it you have half a percent right now? >> that's my point. caterpillar has dropped one-third. it was $120 way back in march. it went straight down while the market was going up. a great leading indicator of the slowdown. now the fact that we have a very important data point, the stock is not going down on flat 2013 revenues. that was not part of the guidance before. i think it's a good sign that at

least caterpillar is finding a bottom. >> let's bring matthew lloyd in here from adviser assets management. how are you investing with all of these mixed signals? >> i think it's a great opportunity for contrarian invefi investing though you have to be more patient on the equity side. there are things underestimated in the marketplace right now and that is net wealth of the consumer and how that will affect consumption going forward and underestimated the rebound in this economy and fighting the fed mantra that people have forgotten. all of those things are reflating assets. on the dips i would buy technology, buying financials and looking at china as a good entry place. >> what would you be buying here? >> we're watching a big name that's coming out with earnings this week is u.p.s. they went from 1.20 now 1.06. that's a big leading indicator for consumers and what we're

expecting for next quarter and how we're buying. >> they already said they were seeing a slowdown worldwide. fedex was saying the same story. what makes it attractive to you right now? >> it's down 4% for the year. it has a nice dividend. they have a couple companies they're taking over on their plate right now. that's a great company to turn it around. >> has anything changed in the fourth quarter? i know for a long time we were talking about third quarter earnings looking at a contraction. that's what we're getting here. then you were expecting the fourth quarter to see a rebound. are you still expecting a rebound in the fourth quarter in earnings? >> we're still hesitant. for second quarter we had a similar story. initially most of the companies in the beginning had more disappointing results. by the end of the second quarter we did okay. it was a slightly positive quarter over quarter. it's still early. we are expecting more of a rebound in fourth quarter. >> you feel like you're paying more attention to the fundamentals of the market right now. today and freddie notwithstanding. >> there's a lot of noise about

the election. obviously a lot of global macro economic stories going on. what drives the stocks day-to-day, whether it's the economic stories or whether it's fundament fundamentals, wait it out and give it a week. >> even as we've taken down some of the numbers here besides tech now we're talking about multiindustrials, the big ones like parker for example, industrials and materials, even as we have taken numbers down in the last week and a half, the s&p is only 2% off. we came into this quarter, beginning of october, at four-year highs. we're still only 2% even with all of those numbers coming down here. i agree with danielle who brought up a point earlier. we were holding up well with the fed stimulus. >> thank you for your thoughts on the markets. thanks. >> see you soon. thanks very much. ladies, 50 minutes before the closing bell sounds for the day. dow industrial down 90 points. >> and it goes without saying we'll be following this market

in the final hour and a lot more. >> coming up, cats and dogs living together? democrats want a tax cut. republicans want to raise taxes. what is going on here? the answer is straight ahead. plus, just below the surface. microsoft trying to take a bite out of apple. can its tablet make a dent? and is windows 8 hurting more than helping the tax giant? we break down the numbers. and telling signals. the financials had their week of earnings. who won? who lost? and which banking stocks are buys right now? that's all ahead on "closing bell." americans believe they should be in charge of their own future.

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here's something you don't hear that often. democrats fighting for particular tax cuts while republicans are pushing for the elimination of that tax cut. what's that all about?

hampton pearson in washington is here to explain. >> well, bill, like all things in washington, not exactly and it's complicated. over the weekend congressman chris van holland, top democrat on the budget economy told cspan that i don't think anyone thinks we should permanently extend the payroll tax cut but given the situation we're in i don't think that should be taken off the table. ending the payroll tax cut is about the only thing that right now enjoys a bipartisan consensus is one of the ways to avoid going over the fiscal cliff and removing $600 billion from the economy in 2013. congressman paul ryan, mitt romney's running mate, has called the payroll tax cut sugar high economics. that 2% at a roll tax cut on wages is used to fund social security. aarp arguably the most powerful lobby for seniors says after two

years a further extension sets a bad precedent in undermining funding for social security. it will be over the fate of the bush tax cuts especially for rich americans versus extending middle class tax cuts. so can we say negotiations? >> can we is the question. thanks, hampton. how will this battle play out? andrew fieldhouse is with economic policy institute. he says allowing social security tax cut to expire puts too much drag on the economy right now. alex is an economist and research fellow at the american enterprise institute who thinks the tax cut was and still is a bad idea. andrew, why should the payroll tax cut be extended? >> it's premature to withdraw any fiscal stimulus at this

point. both sides of the aisle are concerned now that it will push the economy back into a recession. it's important to understand that expiring ad hoc fiscal stimulus is the biggest economic drag within the so-called fiscal cliff. you are looking at shaving about 0.9 percentage points from real gdp growth next year. you need $100 billion worth of stimulus to mitigate that drag. policy makers have to keep the economy moving and fiscal stimulus is the most effective way to restore full employment. >> alex what about you? i know that you don't like the concept to begin with but is now the time to take it away when the economy could really use the money? >> i don't think it's been effective when it's been in place for the last two years. the evidence for policy is similar to this. we tried a similar idea in 2008. people keep the money instead of spending it. the order of magnitude is

generally 20 to 25 cents on the dollar gets put back in the economy and the rest people keep in their pockets in saving or paying down debt. >> what's wrong with savings? what's wrong with saving money or paying down debt? that's a part of what's going on in the economy right now. >> but where is the money coming from? the u.s. is running up its federal deficit. we now finished the fourth year of a trillion dollars plus in federal deficits. we're not taking that money anywhere except from overseas borrowing. >> there's no crowding out effect right now. you have big budget deficits because the economy is running a trillion dollars below potential. cost effective stimulus is partially funded. you can do better. i agree that payroll tax cut will be saved replacing it with infrastructure investment and aid to state governments would get you more in terms of unemployment. you need fiscal stimulus to

return to full employment. it's that simple. >> if the theme is that democrats and republicans switched talking points, this is a great example. now we talk about tax cuts that pay for themselves which republicans are obviously frequently attacked of making those same claims. i think what we see -- >> the issue is do you want to take away stimulus now at this moment in time given we do have pressure from the fiscal cliff. we go back to recession in 2013. both sides can't agree on anything. it's really timing of taking it away, isn't it? >> it's terrible time to take it away. >> it was always intended to be a temporary policy. it was intended to be a one-year policy in a deal made to be a two-year policy. i think it is important to start to think about how to restructure the tax code and the whole entire fiscal situation so we start down a path of addressing some of these fiscal challenges. that doesn't mean let ourselves go off the edge of the cliff. it does mean start to take a

hard look at policies that are in place, which ones work and which ones don't. >> does what you're taking away from social security and social security can barely afford having this money diverted away from that fund right now. does it outweigh the benefit that the tax cut is giving the economy right now. >> you can easily structure a tax cut to be virtually identical and fund it out of general revenues and leave social security off the table. you could do targeted tax rebates as an alternative worried about social security. you can stimulate the economy in a variety of ways. there are a better way to do it. payroll tax cuts are more effective. it's a better targeted tax cut. this provides support to the economy. it's 120 billion dollars of disposable income. >> thank you. i appreciate the quiet nature of this negotiation just now. if only that could work that way in washington come november. we'll see what happens. thank you, both.

all right. heading toward close here 40 minutes left. the dow off the lows again. we're down 74 points. >> up next, one of the biggest bears on the street. morgan stanley chief equity strategist explaining why this market could be headed to a 20% sell-off by year end. that would be another 2,600 lower for the dow industrials. microsoft unleashing a commercial barrage for its surface tablet days before apple unveils its ipad mini. find out which stock might thrive in this latest battle of the tablet wars when we come back.

welcome back. shares of monster beverage getting hammered today plungein sharply with reports that the energy drink could be related to five different deaths. >> that plunge in the stock price of monster energy coming just after "the new york times" posted a story that says that as many as five people may have died after drinking the popular

energy drink monster energy. that's the highly caffeinated beverage. we reached out to the fda today. here's what the fda told us a little while ago. they said we have received reports of five deaths under investigation and one heart attack. we're still looking into those reports. we continue to evaluate the emerging science. the fda is also saying that these adverse reaction reports serve as a signal and don't prove causation here but one thing mentioned in "the new york times" piece is a lawsuit filed last week. some details from that lawsuit are heartbreaking. it's filed on behalf of a 14-year-old girl. a maryland teenager that drank two monster energy drinks on consecutive days and went into cardiac arrest and later died. she suffered from an inherited medical condition that can weaken blood vessels. her parents are suing monster energy. we reached out to monster and they have not yet gotten back to us with a comment on the story. >> what about the product in

terms of being on store shelves still? >> it's on store shelves now. you can see it any time you go to 7-eleven you can see that. one of the details in the lawsuit is 24 ounce can of monster energy drink contains as much caffeine as many as 14 coca-colas. that gives you a sense of the burst of caffeine we're talking about here. we're talking about a young woman with a previous condition that made her maybe susceptible to that dose of caffeine at once. >> what a story. thanks very much. monster beverage under severe pressure. not only stock moving lower today. let's get some other technology losers today. >> large cap tech stocks including google continue to weigh on the nasdaq ever since 1:00 p.m. eastern these stocks have moved sharply to the downside. one bright spot i got to mention, netflix rising after a new study revealed that 20% of

consumers consider online video as a replacement for pay tv. 28% short interest on shares of netflix. what we're seeing right now is some short covering. netflix also reports earnings tomorrow. street expecting a quarterly revenue of $905 million which would be a 10% increase year over year. back to you. >> all right. thank you very much. meantime, speaking of technology, microsoft shares are down over 2% today and it has lost over 10% in the past month despite the coming launch of windows 8 and the new surface tablet at the end of this week. is the market saying that maybe it's a bad idea to try to compete with apple, which is expected to unveil its own mini ipad tomorrow. it dominates the tablet field with the normal size ipad. on the technical side and the fundamental side, we have our guests. what do you think the message is, zach, with microsoft down as

much as it is with a very important couple launches coming out here. >> that's a little bit of a softball question. microsoft is down. i happen to be long both of these names. i have more conviction in apple when it dipped back to 600 or close to that on friday. if you are sitting in the respective headquarters in cupertino versus seattle, which future looks brighter given the nature of the ecosystem you are creating and microsoft issues are well understood, are not radically different than the last ten years which is what's this company going to be as the world moves away from pcs with installed software and apple has answered more of those questions fundamentally as to what it's going to be in the future. >> speaking of those ten years for microsoft, they were sort of a loss decade for shares of that company, carter. how about shares right now?

>> issue with two stocks down 10% to 12% over the last month is it weakness to take advantage of or weakness to stay away from. with apple, we think it's weakness to take advantage of. you can see it's weakness to take advantage of. 700 to 600. the weakness in microsoft we would put in the second category. weakness to stay away from. this has a topping out flavor to it. this weakness is not something we would take advantage of. of course the long-term is just messy to say the least. chop you up and take a lot of time. >> thank you both for your thoughts today. you're welcome, zach, on that softball questionnaire. >> we're in the final stretch. about 30 minutes before the closing bell sounds. a market off the worst levels. down 65 points on dow jones industrial average. down more than 100 earlier. banks led the market up and down since the financial crisis. what did this year's earnings say about the group? meet someone who says it's time

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welcome back. more developments in this lawsuit against monster beverage. >> just brought you the story of monster energy and a lawsuit against the company alleging that their energy drink was involved in the death of a young maryland girl. i said we reached out to monster for a statement. we now have that statement in hand. let me bring exactly what monster is saying right now. they say monster beverage corporation is saddened by the

untimely passing of ms. fo everyone also saying that the family has chosen to file a lawsuit which monster intends to defend and in light of pending litigation monster's policy is not to comment further. maria, back over to you. >> big banks handing over earnings spotlight to technology sector this week. which banks were big losers and winners? let's check in with mary thompson. over to you, mary. >> fixed income trading contributed to better than expected results from a number of big banks even know net interest margins what they earn on loans minus what they pay out

on deposits and that area continues to be squeezed. earnings combines the actual earnings reported and the estimates for those still to report. they are up 5.4% which is healthier than the overall decline of 4.5% in third quarter earnings for s&p 500. now most of the big banks beat analyst forecasts. goldman numbers were strong thanks to an increase in value in securities and lending portfolio. wells came in a penny ahead and stock took a hit immediately after the results as banks revenue missed wall street's forecast. morgan stanley stock struggled since it reported its results on thursday. it lost money but excludeing a massive charge for changing value of debt. morgan's operating earnings increased from a year ago quarter. the regional banks reporting this week. they too have been hurt by declines in net interest margins. they don't have any improved results from their securities divisions to offset the squeeze. some are taking a hit right now.

back to you. >> with earnings from big banks out of the way, do you buy or sell this group? >> we have both sides of that debate right now for the bulls it's anton and in bearish camp is matt mccormick. anton, some of the high profile banks while earnings do improve a little bit, they do highlight what low interest rate environment does to their earnings capabilities with these net interest margins. you still like these banks nonetheless, right? >> well i like particularly ones with capital market exposure because they put up nicest quarters of all and they trade the cheapest relative to back value and forward earnings and big machines returning capital through bdividends and buybacks. >> what do you think? where are we in terms of profitability for this group? obviously the record low interest rate that we're talking about is going to be with us

until 2015 or so. regulatory environment. dodd-frank which everyone complained about going into this earnings period. how do you feel about the group? >> you need to be selective. i think the money center banks are areas where we have the most concerns. we like regional banks because they don't have as much as capital market exposure. we think the markets looked stretched. we think there will be more volatility. a lot of revenues came from trading. i rather be with areas especially in regional banks where they are safer, a little bit more nimble. they don't have headline risk and they have bigger dividend yield. mime more comfortable conservative in the financial sector with regional banks. >> regionals usually are the banks that stay away from the riskier plays in the market. they came out of the financial crisis better. now even the big banks are avoiding all of that risk these days. why would you stay with regionals in this case? >> i think when you -- like any

financial, you need to be selective and so we like u.s. bank which is one of the best managed companies out there. we like cullen frost in texas and we like bb&t. if you think housing is starting to pick up, we think there's an area of potential growth. you don't need to buy all regional banks but you need to do your homework. we like ones that have very sound management. very strong dividend policies and know their shareholders. they have a high degree of confidence and i like they don't have a huge exposure to europe which is a mess. >> anton, what do you like here? who is best positioned? >> i actually like a lot of the smaller banks that hopefully matt's banks take over. i think there will be a ton of acquisition in smaller names. i think you have to own a basket of them. i think there's going to be huge consolidation. the problem with regional banks today is net interest margins are getting squeezed. not a lot of loan growth and tons of regulation.

that sets it up for great m & a environment. big guys won't participate. no risk for owning big guys. they don't do deals. the super regionals will be buyers and position in places like florida where there's going to be a lot of consolidation and a lot of talk about companies like bb&t as being buyers in that state. you have to own attractive banks. >> we're looking at a list that says the way for you to play the financials would include the citigroups and banks of americas which would be the most exposed to regulation risk and regulation risk out there right now. why do you like these guys? >> the way my portfolio is built is i have a bar bell. i have big money centers and investment banking plays on one side of the portfolio and a lot of takeover plays smaller cap names on the other side of the portfolio. when one zigs, the other zags. i really do like capital markets and i think once we get to the election, post-election period,

you'll have pickup on markets and demand and market share capture out of big banks from all of the troubles in europe. there's a lot of revenue potential growth and m&a activity coming out of europe and u.s. banks are poised to capture it. >> gentlemen, thank you for your thoughts on the banks. >> great analysis. thank you so much. we'll see you soon. >> heading toward the close. 20 minutes left here. the dow well off the lows. the buy is for the close to the buy side and dow down 44 points. >> look at this comeback here down 45 after cutting losses in half. if you're a bull, you may not like what our next guest has to say. calling for 2% sell-off by the end of the year. that comes next. >> also, after the bell, get ready. yahoo!'s first earnings report under the new ceo. will they show any signs of a turnaround at that point? many are not optimistic after google's dismal numbers. we'll have full team coverage of those numbers coming up later on "closing bell." stay tuned. [ male announcer ] at scottrade,

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folks who save hundreds of dollars switching to geico sure are happy. i'd say happier than a slinky on an escalator. get happy. get geico. melons!!! oh yeah!! well that was uncalled for. folks who save hundreds of dollars switching to geico sure are happy. how happy, ronny? happier than gallagher at a farmers' market. get happy. get geico. >> a bit of a comeback here. market cutting losses in half as you can see dow jones industrial average down 51 points.

nasdaq in positive territory right now due to a rally in apple which is now at session highs. sharon epperson is at the nimax with that part of the story. >> a significant sell-off today in the oil price as well as across the board in energy complex. a lot of that has to do with supply issues. supply coming back online from transcanada's keystone pipeline that was supposed to be restarted today. that's something that the oil markets were talking about quite a bit. we're talking about futures below the $90 market. low end of the range is between 88 and $92 a barrel for the last several weeks. natural gas prices are under pressure today. a lot of traders saying that now the focus is back on the fact that there is still plenty of natural gas in storage even though it will be slightly colder temperatures coming up and the fact that we're looking at key support level that natural gas was able to break through even though it hit a 2012 high earlier in the session. back to you. >> big story in "the new york times" over the weekend about

natural gas taking a toll today as well. markets are seeing in the equity market another sell-off. this is where we stand for s&p so far this year. it is up 13%. at least one of our next guests, that would be adam parker of morgan stanley, calling for 1,167 for s&p by the end of the year which would be 20% lower than we were right now. >> also joining us is jason. gentlemen, always great to see you. >> your number is not much better. you see 1,250 by the end of the year. >> let's talk about that. what takes you to a 20% sell-off? >> on january 1 of this year we set the target. we have a frame work which is earnings are going to be lower than people think. in fact, as you probably know, we're seeing no earnings growth for the entire s&p right now. and historically when you add low growth and extreme rates, it was bad for the multiple. so if i told you on january 1 you would have lower earnings, down earnings year over year,

the frame work said multiples will contract and so that's how we came up with our call. >> what you didn't see was a market that wouldn't trade on those fundamentals, right? i mean, the markets have gone higher in spite of the continued reduction -- >> you have seen a big disconnect. earnings got worse and multiples expanded and the question is will unconventional policy help the real economy or not? our thought is i haven't seen anybody raise their gdp numbers or lower unemployment numbers based on it. we're in this temporary period where multiple is higher but ultimately the fundmenta ylamenl true it up. >> you're not that far away? >> when we run into clients, fundamentals don't matter and there's enormous drag bernanke put in the market and the other is that the market is wrong. both of those things can't be right. every time i said one of those things, i've gotten run over. they won't last forever.

i'm much more inclined like adam we're using a $93.50 target for earnings s&p 500 earnings next year which would be down about 8% from where we're seeing them this year. i have to be candid. there's not a lot i can see to provide the basis for multiple expansion in the next three or four months when you deal with the election and you deal with fiscal cliff issues. europe is likely to get worse because the currency is strengthening and the big bottom line is that top line isn't growing fast enough to support the profit margins that we have achieved over the last couple of years. >> that's precisely what we see with companies like caterpillar and ge and other companies that have come in light on the top line even though they have beaten on the bottom line. >> so much cost you can ring out of the system in terms of labor and depreciation. all those things reach the outer limits especially when you have nominal gdp growth. >> what about the idea that things will rebound in the fourth quarter? do you believe in a rebound in

the fourth quarter earnings? >> i don't. >> what about you? >> i think estimates are way too high. i agree if revenue numbers has a right, earnings numbers are way too high. we think they'll come down and we're pretty close. we have $100 earn thgs year. 99 next year. the street is at 116. i think buy side is halfway in between. maybe 107, 108. numbers are going to come lower in our mind over the next couple of quarters. >> i'm going to sound like pollyanna here. we hear from ceos about the fiscal cliff and impact on corporate strategy that they are holding a lot of cash back and not spending it because they want to wait to see what comes out of washington. let's assume they fix the fiscal cliff and there's a compromise reached that is pleasing enough to the markets and to corporate executives out there. does that change your scenario? >> i would probably have to duck some rainbows and unicorns to think the whole thing is resolved. payroll tax reductions have

bipartisan support. we think there's a 500 basis points fiscal cliff in the law. if you have 100 basis points headwind, you need housing to turnaround to get a flat gdp. >> how do you invest if things don't turn? >> if you have a long-term time rising, you have to invest in what the fed is taking away. one of our big themes is this idea of financial repression which means you'll likely get negative interest rates from sovereign debt for the next five to ten years. that means any stuck that provides you again what the fed is taking away should trade at a premium. i would be careful in terms of chasing the cyclicals here and in the end of the year i know a lot of people think defenses are expensive. our view is they'll get more expensive before they get cheaper. >> you want dividend growers. >> i think defensive consumer staples, health care, those

sorts of stocks will get more expensive before they get cheeper. >> i'll ask you what you will guy when you get down to the countdown. >> i think this underlines the fact that fundamentals do matter. when we began this earnings reporting period, we were out on cnbc.com with an article that fundamentals matter and the fact is that we have seen the earnings really impact the performance of this market. no doubt about it. >> can't ignore them forever. ten minutes before the closing bell sounds on the street. we're well off the lows of the day. >> food may be delicious but investors lost their appetite for shares of chipotle mexican. when the stock make a comeback after being designated the last few days. we'll hear some of that from jim cramer coming up next. >> are presidential candidates going too far with china bashing? the caterpillar ceo says yes.

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could it be the great burrito bust? remember last year chipotle was the s&p's best performing restaurant stock. >> let's look at this chart here. over the past three years chipotle returned about 170% but since the earnings disappointed late thursday, the stock plummeted down nearly 20% in just two trading sessions and now it is at a 20 month low right now. >> jim cramer just asked chipotle cfo about the sliding stock price. this is what he said. >> do you think wall street is finally realistic? it's not like you didn't tell

them pointblank it's slowing. >> there was a lot of momentum in our stock early in the year that drove it to all-time high. it may be a turnover in some investor base and if we attract long-term chipotle fans that think we have a bright future in our stock, that would be great for us. >> as we all know, it goes cyclical right now. you'll see the rest of the interview tonight at 6:00 p.m. eastern time on "mad money." chipotle was the place to go for a couple years. we've never been as it happens. just by happenenhappenstance an denine. it was hot from the get-go. when you have that performance coupled with negatives in the food business, higher expenses, margins squeeze passing to the consumer, there's a vulnerability there. >> it is food.

margins are razor thin. it's a very tough environment right now. >> take a short break and then closing countdown after this break. >> we're just minutes away from yahoo! and texas instruments earnings. full team coverage on numbers and analysis still ahead here. >> and more americans are saying no thanks to free money by not taking advantage of the company's 401(k) match. has wall street lost the trust of main street? we'll check it out. you're watching "closing bell" on cnbc. first on business worldwide. to compete on the global stage. what we need are people prepared for the careers of our new economy. by 2025 we could have 20 million jobs without enough college graduates to fill them. that's why at devry university, we're teaming up with companies like cisco to help make sure everyone's ready with the know how we need for a new tomorrow. [ male announcer ] make sure america's ready. make sure you're ready. at devry.edu/knowhow. ♪ a body at rest tends to stay at rest... while a body in motion tends to stay in motion.

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>> if we wait long enough as we head toward close with four minutes left, we could be positive on the dow. bias has been to the upside. the industrial average is down just six points. on a day when the tone was set by caterpillar with a familiar refrain by so many companies that we've heard from who beat on the bottom line but they weren't on the top line. they were light in terms of revenue and they warn there's a slowdown coming and will continue and we heard that from doug this morning, the ceo of caterpillar. it helped that stock. i'll get to that in a moment. we were down 110 points midday and then we started a comeback of sorts late in the day. but we did and we are now below or have been below 50-day moving average. one-year chart of the dow here.

i want to see this carefully here. it's not that precise. what we might be doing is moving below the 50-day moving average and then testing it again to the upside. we'll watch that over the next day or so very carefully. the best performing dow component today was caterpillar. they set the negative tone this morning with the warning and here it is up 1.4% on the day. ge was the worst performer among dow components with the soft earnings on friday. it was down sharply that day and down 1.46% today. the dow is positive for the day. despite that, here's something we haven't talked about in a while. the fare indicator rising again. the vix up for the first time since mid june. we'll watch that carefully. still far away from the 20-point yellow flag area. sectors today, when last i checked, only one was positive among s&p 500 sectors and that was technology. the rest of them were negative.

even s&p financials are moving into negative territory today. let's go over to our traders here. peter costa, what's the comeback here do you think? >> i'm surprised at this comeback. i thought we would be down 50 or 60 points concerning earnings that we've seen. cat was the only one even with earnings. it was above what we thought but not as good as what you would want. i was surprised. >> don't you think we were oversold? >> we should have been oversold on the opening. it acted like it did on friday. it wasn't a massive sell-off this morning but it turned into more of a route in the afternoon. >> it plays into your hands, adam parker, and your expectation for the rest of the year here. >> i don't make the intraday calls. to me the earnings trajectory looks negative. portfolio managers have three choices. they can buy cyclicals that have been works, they can buy

defensives that are expensive or they can buy cyclicals where things look bad and hope they get better and so we actually think they'll go short-term to that door number three and buy some of the cyclicals as a shot. >> meaning who? >> some machinery names that you alluded to earlier and some of the semiconductors as well. it doesn't mean the market goes up a lot. it's just the cheapest option they have given fundamentals are bad. >> we have microsoft and texas instruments. what are you expecting there? >> microsoft is under the gun right now. i don't think earnings will show anything this quarter. i don't see any surprise from them at all. i think we have to wait to see how well microsoft 8 or windows 8 is received at the end of the week. i think i'm hearing a lot of seminegative things about it. >> all right. thank you, gentlemen. it's a touch and go whether we'll