commercial from 2012. watch. >> pdas, handhelds, i've seen these. what do we have that's new? >> this just came out. >> interesting. >> that's the new taco bell chicken quesadilla. >> that is jeff bezos promoting the kwas dee ya. >> thank you very much, jane wells. thanks for watching "street signs." "closing bell" starts right now. and welcome to a very special edition of "the closing bell." i'm kelly evans here at the rise forum at the university of dayton in ohio. this is an event, bill, featuring current and future leaders of finance. there's some added excitement here on this campus because the dayton basketball team, a cinderella story, playing in the sweet 16 tonight. there's a little bit of a stimulus package here in dayton as these t-shirts are selling like hot cakes.

>> they are the cinderella team this year. you got to bring me one of those t-shirts. please, i'm begging you. >> i'll try. it's hard to get your hands on one. >> i'm sure they are. i'm bill griffith still here at the new york stock exchange. this stock market is also looking for its own cinderella story today, fighting to get back into the green territory. the dow has been on either side today of unchanged. now down 21 points. kelly, we're going to explore whether this market actually has seen a stealth correction. we're also so focused on the dow and the s&p, but is there a whole section of the market that's already seen its own correction? we'll look at that coming up here. >> now the students here at dayton fired up about basketball. but many are also pretty excited about legg mason's bill miller speaking here moments ago. a legendary investor joining us exclusively in a few moments. we'll get his take on the momentum stocks getting hit. plus, his take on citigroup and

the financials and more. >> always look forward to bill miller's comments. also, microsoft's new ceo with his big coming out party. finally microsoft office for the ipad is being unveiled. and many are asking what took so long? we'll look at that and its possible impact on the stock, which is down with the rest of the market today at $39.44. the street so far rather unimpressed. that stock not moving much and habit lately. but this might no be the only big move the company's new boss has in store. we'll have much more on that just ahead. first, a look at how the markets are trading right now as i said, the dow has been on either side of unchanged so far today. and we can show you those charts any moment now. the dow down 28 points right now. it did see a bit of a stutter step opening this morning. we're trading now at 16,238. nasdaq still the big one to suffer, down 30 points right

now. about three-quarters of a percent at 4142 below what had been perceived to be recent support levels, which we'll talk about. the s&p at this hour is also trading lower, down about six points at 1845. let's talk about it in our "closing bell" exchange. heather hughes with us. so it jim lowell. john doyle. warren myers is with me here at the big board. of course, rick santelli is in chicago. warren myers, what about this choppy market action we've seen recently? somebody said yesterday that to them it signifies an uncertain market, a confused market is also how somebody put it. what do you think? >> that's usually an indication of a choppy market. you get two very distinct opinions. because of that, you get a lot of up and down. we've been seeing quite a bit of that. not surprising given the run-up we've had in this marketplace and where we are economically

with the u.s. economic data being marginally improved but some of the european issues creating uncertainty. it's not uncommon to have this choppy market. very nonunexpected is the way to put it. >> rick santelli, i'm out here in dayton getting a first-hand look at some of the excess capacity in this country. still, i can't understand why the 30-year bond went below 3.5% today. maybe you can help illustrate what's going on. what does that tell us? >> i think it tells me that, you know, at some point we're going to have to find an extra 250 to 300 basis points of tightening in 2015 at some point to pack into the yield curve. so everybody's done an about face. they're selling the short maturities, buying the long maturities. i think that curve implication may be with us for a while. you have to go back to july of last year to find us up 350 close. yet, if you look at where the five-year was before the fed

statement at -- in the 150s, then moving to 170, where it still sits today. really, the dynamic we should pay attention to is threes, fives, and sevens. they're really hunkered down, which makes me think that it's not only the curve implications of buying the longer end against the shorter end, but it's also an ongoing anxiety regarding the equity markets and any of that nervousness is going to result in purchases, in my opinion, on the long end as well. >> speaking of anxiety in the equity markets, heather hughes, our research team did a great job in identifying a group of stocks. we're all watching for some sort of correction, a 10% pullback in either the dow or s&p or something like that. but what our research team showed is it's the momentum stocks. such high flyers in the last year or so going through their own correction right now. the facebooks, the netflix, the teslas. >> they're getting pummelled.

when you look at the biotech index, that's getting crushed. i think investors are playing defense right now. that's what i'm hearing on the street. they're moving back to utilities. they're moving back to the safer sectors that tend to do well like consumer staples even. you're seeing the high flyers, even the biotech index get crushed. 122 companies of the nasdaq biotech index bringing zero revenue. whether investors have overpaid for stocks that comprise that sector or not, time will tell. but for the time being, investors are playing defense right now. >> is this the correction we've been waiting for, or do you think this could bode ill for the broader market down the road, heather? >> no, i think there's just some consolidation right now. there is a long-term deckular bull market still in place. the pullback that started, i wouldn't call it a correction as defined as 10% or maore.

the exact same level we pulled back in the s&p back in may when the fed announced raw mores or hinted at rumors of tapering at that point. so we're far from that 10% correction. i don't think we're going to get there. >> you know, john doyle, can we talk about the consumer for a second? it's the worst-performing sector this quarter. it's about to turn in its worst performance for a quarter in 2 1/2 years. we learned this morning that the composition of the gdp report for the fourth quarter showed a big jump in health care spending and hospitals in particular. if you look at the consumer names struggling so far this year, it's best buy, staples, gamestop, matel, gm, amazon, coach. is there a shift underway here? what is going on with the u.s. consumer? how much is getting squeezed out potentially by health care or how do you play this? >> well, i think you're right about the numbers that came out this morning. personal consumption was up 3.3%, besting expectations from an overall boring reading with

gdp. i think what that shows is possible momentum at the end of last year moving into this harsh winter that we've seen. so i think the consumer is going to be extremely important in q-2 and q-3 as we move out of this harsh winter and stop blaming the weather. hopefully with that, that will boost stocks moving throughout the rest of the year. we still see on the s&p about 7% higher next year. >> jim lowell, can i get you to weigh in on this issue as well? what do you make of health care versus other forms of consumer spending? do you see something significant happening here? does this help explain it all? because it comes at a time when biotech has been breaking down. there seem to be mixed messages on what's happening with, both with health care specifically and the consumer more broadly. >> well, tomorrow we get income spending savings and the sentiment read on the consumer. that will give us something. i don't think the consumer is anywhere near down and out. i think weather related impingements, probably. some of the stocks you named

have a seasonal pattern of selling off. i wouldn't worry overly much about that. from an investor side, we've seen very rational behavior. investors are selling their momentum stocks, places where they had the biggest gains but companies that are trading only on growth potential, not real growth. and they're holding on to, if not building into, some of the more defensive sectors in the marketplace, maybe like utilities, but also the battle should balance our blue chips. looks like a great safe haven to ride out what could be an uneven market. >> i do agree, jim. i hope that there is that pent-up demand as the weather warms up in spring and we didn't spend all our money on snow boots and snowplows. i think that will hold true. i know we had snow here in d.c. two, three days ago. aside from the fact we are

probably geographically out of it, i think the consumer will come back as the weather warms soon. >> so warren myers, we've identified where the money is coming out of. where is money going? >> i think it's been mentioned here already. more defensive type names and the large-cap stocks. the nasdaq has been underperforming both the s&p and dow recently. i think one of the reasons is money is coming out of those growth stocks out of the nasdaq and some is going back into the dow in particular and those large multinationals. i think that's a safer place to be. i think there's a better comfort level for most investors to be in those big names right now. >> it's fascinating. the money as well seems to be going into the bond market, rick. it just continues to surprise. >> yeah, you know, i think it does but let's not lose sight of the fact we gave them fancy names like momo stocks, momentum stocks, but they're walter mitty

stocks. it's different this time, gives me a q-easy feeling about names like tesla and solar city. it's not that they may not make a good car or solar panel, but if it wasn't for the access to easy money, tax benefits, this misallocation of capital is going to come back to haunt the stock market. >> all right. we have to go at this point, gang. thank you all for joining us. we'll see you later. heading toward the close, about 50 minutes left in the trading session with the dow down 29 points. kelly, at this point, the s&p is now negative for the quarter. so if things don't pick up in the next couple of days before the end of the quarter on tuesday, we're going to see a minus sign in front of the s&p for the first three months of this year. >> oh, sure. and bill, if we know that 1878 is the high water mark for the closing high for that index, 1848 is the level below which it turns negative. we'll keep a sharp eye on that into the close.

up next, we have bill miller on the markets. apple was one of his funds top holdings last year. wait until you hear what's at the top of his list now and what else he might be eyeing. >> also ahead, has the ipo fever broken? king digital made more of a thud than a bang on its market debut yesterday, as you know. our wall street pros are trying to gauge if this is the start of something bad for the ipo market or if candy crush was just a single bad idea. we'll look at that coming up. >> plus, on the heels of citigroup's second stress test failure in three years, we want to know how much you think of a regroup is needed at the banking giant. tweet us @cnbcclosingbell. your tweets on air later. don't go anywhere. more "closing bell" after this.

welcome back. minus signs across the board. minor minus sign, if you will, for the major averages. mixed economic data today. the unemployment claims number this morning was less than expected. so below expectations. that's a good thing. but the pending home sales number was also less than expected. and that's not a good thing going into this spring home selling season.

right now the dow down 17 points, trying to get back to unchanged here, kelly. >> all right, bill. thanks very much. now bill miller burning up cnbc.com at the moment with the piece he wrote about making money in a changing stock market. something he also just spoke about here at the rise forum to a packed house. joining us now in an exclusive interview is mr. bill miller with legg mason. i want to pick on something bill griffith mentioned, which is pending home sales. the index has been down eight months in a row now. you liked the builders here. they've rallied tremendously since we last spoke. do you still like them? >> the builders i think is one of the easiest investments. people are too obsessed on whether it be building permits or housing starts or the kay shiller index. we're about 500,000 a year deficit for what we need to get us back to e quill ib ree yum.

probably a five-year cycle on housing left. most of the big builders, those trade now at market multiples or below on this year's earnings with probably 25% earnings growth the next several years. i think housing is essential to the economy. i think for an investor as opposed to a trader, it's a great investment. >> what about the financials here? on a day when citigroup is down if the range of 5%, 6%. a huge move for a name as people were so much on this expectation of capital return and not getting it today. at not getting the dividend they were looking for. >> financials are cheap historically. the dividend growth of the big banks is going to be among the best in the marcht the next several years. the citibank decline today is the perfect opportunity for nrss and traders. i think it's tu to high-frequency trading where the algorithms are working off headlines. they're knocking the stock down.

citibank's value didn't change today from yesterday 5% or 6%. more importantly, citi is going to have a tangible book by the end of this year. they'll trade, in my opinion, at probably 10 or 11 times. so from 48 or 49 today to 70 in 24 months. >> wow. you're saying the news doesn't matter. >> it doesn't matter at all. it matters only in the sense that citi wants to return some capital to shareholders. they're going to be better than they are. the capital plan had to do with planning losses in overseas markets. they can address that. i think that's just another opportunity. >> let's talk about some of the other names that have been hit hard lately. for example, netflix. it's off its peak by something like 20%. obviously the stock has moved up and down, all over the place. where do you think it goes from here? >> well, i think long term it goes higher. in the short term, it's caught up with these momentum stocks that people like to rent as opposed to own.

netflix is 40 million subscribers. they're number one in internet television. the stock has had a huge move in the past year. it's going to be more volatile. still, its mark cap today is about what whatsapp was sold for. and whatsapp has no revenue. with every dollar they raise the price and trade at about half -- their monthly cost is about half of what hbo is. so every dollar would be about $40 million a month or close to $500 million a year of free cash flow. so there's a huge amount of opportunity with netflix with 6 billion connected phones in the world and around 700 million high-speed internet lines and they're number one in internet television. we sold a chunk of our netflix. >> where do you see the most opportunity today? >> there's a lot of opportunity across a wide variety of companies in the free cash flow. my favorite is one that we've talked about before, apple.

which is just completely crazy in the sense that apple has $159 billion in cash on the balance sheet right now. if you assume they had no cash on the balance sheet and took this year's free cash flow, it has a 10% free cash flow yield. if the company were never to grow again -- if apple were a junk bond, junk yields are 6%. if apple were a junk bond, it would be 40% higher than it is today. but it's the largest, most profitable company in the history of the world. it's a great innovator. tim cook talks about the new products they have coming. the share buyback is being done very rationally, as far as i can tell. they have a great dividend. i think they'll raise the dividend dramatically in the next few months. for all the short-term traders in the world, it's actually in gear for a technical standpoint. >> do you think then it's going to trade as much as 40% higher from where it is today? >> or tomorrow. no, i think that actually apple -- we sold a lot of our apple in the 650 to 700 range a couple years ago. i think it's probably worth about 700 to 750 today.

but again, that worth should be growing over time. it's growing on per-share basis. >> and given all that, why do you still think bitcoin is so interesting, potentially valuable? i know you own some bitcoin. it's a huge source of controversy on wall street as to whether this thing has any value and is legitimate. one of my favorite tweets from the rise forum that's going on behind us came from one of the students who said, biggest surprise to me of the day so far is bill miller owns bitcoin. it seems to go against these fundamentals of being kind of a value guy or seeing the world in that way. so why bitcoin? >> well, bitcoin is a really interesting technological experiment. an intellectual experiment. i think with bitcoin, what you have now is -- and i started buying it after the mt. gox thing. when that didn't destroy the underlying psychology of it, it looked to me like it had a decent base of around $500 per coin. but it could be a zero.

it's like a venture investment. many of them don't worry out. the thing about bitcoin is the addressable market. it's as big as it's ever been in the entire world. gold alone has an $8 trillion market value. bitcoin has a $7 billion market value. if it's only 10% successful as gold, it's 100 times your money. >> but there are some who say it should be zero. look at what china is doing today even. it's trying to tamp down further on anything that has to do with bitcoin as money. >> anything that undermines the ability of a sovereign to control its finances is something that's going to be controversial. >> fair point. no, but from china's point of view as well, they have a different interest, which is capital flight. i can understand why they might be especially sensitive to something like bitcoin. what about if u.s. regulators take a second look at it and decide, look, they've already said it's property, not currency. does that worry you? >> no. gold is property too, not currency. so it doesn't -- a lot of what people say about bitcoin --

whether it be a unit of account, a medium exchange, it's actually all of those things, but people complain about it being a store of value. they say, well, look how volatile it is. it went up 56 times last year. then it went to 1200. now it's 500. i mean, my view is gold has been the gold standard, right, for 5,000 years. it was $35 an ounce. then $800 an ounce. then $2,000 an ounce. it's pretty volatile. look at the mark after world war i. it disappeared in value. look at the ar jen teen currency in the last 12 months. look the a the brazilian currency. again, the thing about bitcoin i find amusing is there are people that hate it and people that are in love with it. ideological on both sides. i try to be down the middle of the road on this thing. i'm just observing. >> but owning it as well. >> owning a small part of it,

yes. >> very good. so talk more broadly about the market today. we've seen in the last several trading sessions a real breakdown in some of the momentum stocks. the stocks you rent, or whatever you want to call it. what signals are you picking up on more broadly? is this a way of looking at the internals breaking down? is this an early sign of a correction? what do you think? >> it's hard to say. there's a rotation clearly which has been going on for the past several weeks. today some of the material stocks were strong. so it looks a little bit like if i were to try and squinted a ath it hard and make some test interpretation of this thing, it would be that the momentum names, the teslas of the world and the workdays and those kinds of things, they're really hyper growth. so when growth is in short supply, they get much more valuable. if growth is going to pick up, then they're not so valuable anymore because there are other things that have going to grow. that's what the material stocks may be telling you. the economy is going to accelerate, u.s. and globally, and the numbers will get better over the summer, in which case

there's momentum money at the margin shifting. >> and that would be consistent with the recent breakdown with janet yellen indicating a better growth outlook could be talking about why the fed is going to normalize rates down the road. >> exactly. >> interesting. thanks so much for your time, bill. enjoy the forum while we're out here in dayton, ohio. with that, bill griffith, back to you, sir. >> wow, bill miller owns bitcoin. there's the headline. crazy. all right. heading toward the close. about 35 minutes left in the trading session here. the dow is trying to turn positive again. we're down seven points. nasdaq is the laggard once again today. we're down 25 points, kelly. >> and there's going to be much more ahead from the rise forum here in dayton, ohio. who says millennials don't care about wall street? we've got three student investors who are going to talk with me about the markets and why they're investing even before graduating, bill. i love it. >> see if they own bitcoin as well. when we come back, though, hot

or not? gaming stocks on a losing streak. whether this is a perfect buying opportunity, coming up. stay tuned. stay tuned.

whether this is a perfect buying g friday night, buddy. you are gonna need a wingman. and my cash back keeps the party going. but my airline miles take it worldwide. [ male announcer ] it shouldn't be this hard. with creditcards.com, it's easy to search hundreds of cards and apply online. creditcards.com. and apply online. nascar is ab.out excitement but tracking all the action and hearing everything from our marketing partners, the media and millions of fans on social media can be a challenge. that's why we partnered with hp to build the new nascar

fan and media engagement center. hp's technology helps us turn millions of tweets, posts and stories into real-time business insights that help nascar win with our fans. welcome back. investors haven't exactly been hitting the jackpot lately with some of the gaming stocks. the so-called momentum plays hit a wall recently, getting crushed

just this month of march. >> yeah, now congress is aiming at them with two bills just introduced yesterday to ban gambling online. can these stocks make a comeback as that moves forward? >> joining us now is joel simpkons, analyst at credit suisse. thanks for joining us today. >> good afternoon. >> why the selloff now? what's been going on? were they just too richly valued, or is something fundamentally going on with the gaming stocks? >> from a domestic perspective, the gaming fundamentals have been weak of late. a lot of it has to do with the weather. in terms of the news flow you discussed out of congress, you know, we don't see much of an impact from that front. in terms of the asia piece, looking at the large cap, the story has been pretty strong. we've had a good start to the year. a little bit of a soft patch the last couple weeks. still pretty healthy. >> joel, i just wonder if the

message here from the markets is that maybe online gambling mattered more than the casino industry wanted to recognize. because these names are down in the range of 11% to 14% this month talking about las vegas sans, mgm, and wynn. even though they're against this legislation moving forward. but should we be paying more attention, or should investors in these names at least be paying more attention to how hard they're getting hit on this news? >> online gaming is a very small story in the u.s. right now. what you've seen in the last couple weeks is a risk-off environment. when you think about las vegas, asia is probably 85% of their cash flow. for wynn, about the same levels. a lot of fast money rotating in these names last year. i think people are a little cautious about asia. i'm going to take my chips, pardon the pun, off the table. that's what you're seeing in these corrections. >> the question i have is, how do you grow this business? to some degree, gaming is a

zero-sum game. you're either a gambler or you're not when a new casino opens up in location b, are you taking business away from those casinos in location a? you know, because you're not going to find anymore gamblie r anywhere else. >> there's no doubt you're right in terms of the u.s. piece. z you had seen casinos in atlantic cities and other markets start to close because of too much capacity. in the asia piece, we're in the very,er have beginnings of that story. we have a billion people that like to gamble. this is the only legal jurisdiction for them to do that in. you look throughout the rest of the region, whether it's east asia, southeast asia, thailand, cambodia, vietnam, there's lots of growth potential in these markets longer term. certainly there's going to be bumps in the road along that path. >> you know, joel, i'd like to ask about the distinction between gambling and gaming,

which i'm sure is a long-standing one with a lot of legalese behind it. nevertheless, there seems to be convergence on mobile devices. senator graham remarking one of the reasons -- i think he co-sponsored this latest legislation. he says mobile video poker is simply not right. that's one of the reasons he wants to get rid of this whole move towards online gambling. what does that suggest, if anything, for the future of online gaming? >> i think this is going to be a debate between the states and the feds. right now our view is that this is a states rights issue. new jersey, delaware, nevada moved forward with online gaming. governor christie has been a big proponent in new jersey. i think you'll see other states follow the lead. they see the tax revenue opportunity. quite frankly, this has been going on for quite a long time. europe has a large legal online gaming market. they haven't had a lot of issues. they have sports betting. i really see this as sort of a wave of the future. it'll take some time to roll out. this is going to be a states rights issue. the politicians see the tax

dollars and the opportunity. again, i don't see the feds blocking it. obviously, we'll stay close on that. >> all right. joel, good to see you. thank you for joining us today. >> thank you. >> you bet. we are 30 minutes from the close here, kelly. heading toward the close, the dow moments ago looked like it was going to turn positive. has pulled back a little bit. still down four points. >> yeah, bill, i'm just thinking about all of those mobile games. you know, the ipos happening left and right. the amount of time and money people are spending on these devices. anyway, an area to explore in the future. emerging markets are a big source of worry for wall street all year long. next, an investment pro based in asia about any prospects for a turn around. and the chief investment officer of ubs wealth management will be with us. we'll find out where he's putting his clients' money to work coming up. stay tuned.

make it happen with fidelity active trader pro. it's one more innovative reason serious investors are choosing fidelity. call or click to open your fidelity account today.

welcome back. a little more volatility today. the dow has turned positive for the second time today. kelly, we had minor rally in the open this morning. a bit of a pullback.

mixed economic data once again. the jobless claims numbers this morning were below expectations, which is a good thing. the pending home sells numbers also below expectations. not a good thing. so the markets once again dealing with mixed economic reports right now, kelly. >> and, bill, that's just in this country. 2014 is shaping up to be a rough year for china. that nation's latest manufacturing data showing signs of a slowdown and fueling further speculation of a government stimulus package, perhaps. over the past year, chinese stocks have fallen nearly 11%, while the u.s. market has seen gains of more than 18. >> so will china's underperformance continue, or is that weakness a buying opportunity at this point? joining us right now is donn n hanna. welcome. good to see you. why the slowdown now? it was just inevitable? is it part of the business cycle? what's going on in china in your view? >> the slowdown is not part of the business cycle, per se. it's a functioning of a

tightening of credit they began doing near the end of last year. >> and it's working, obviously. >> working a little too well. as a result, they're going to start reversing it, just like they did last year when they tightened it in the beginning of the year, eased in the middle, and now they've been tightening, and now they'll ease again. >> don, here at the university of dayton, there was a panel this morning where several people weighing in on the question of china acknowledged all the risks, acknowledged the fact maybe you can't trust the figures coming out of that country and said, look, the stock market is trading so cheaply we'd rather own it, rather have some exposure to the upside, trusting they're not going to have the kind of credit crisis the u.s. went through. is that too sanguine in your view? >> what they're doing right now easing again is going to support growth in the short term. that will support stocks. but it's going to mean a rise in lunch. that ultimately is going to be

problematic. but that's a problem for 2015 or '16, not 2014. >> speaking of credibility on the data we get out of china, in your view, what is the growth rate now? the numbers we'd seen for the last few years, obviously eye opening, enviable. it's slowed down here. i've heard much lower numbers now. what's your version right now? >> well, we've got a forecast for the full year, which is about 7.2%. that's year on year. but if we look at it the way the u.s. reports its data, which is from quarter to quarter, annualizing it, you're looking at growth likely in the first quarter that's going to start with a six, which is part of the reason we're going to get this stimulus to boost growth back up. >> is that sustainable, or is it going to go even lower? >> the 6% number is in some sense sustainable if they were willing to stay at that level. but they're not. that's the problem. >> don, curious. i know you're setting up there. you've known each other since you were working on your ph.d.s

together. when you were looking at the opportunity in asia to do more research, why did you pick singapore over hong kong? >> why? largely because as far as family life, it's a little easier to live there. it's a lot better air, frankly. but if you want a place that's got a dramatic landscape, go to hong kong. if you want to focus primarily on china, hong kong is quite good. if you want something more focused on the rest of asia and where your children can grow up with cleaner lungs, you're probably better off in singapore. >> jim rodgers would tell you the same thing. >> he will. >> the emerging markets overall, broaden it for a second here. the big question here in the u.s. is when is it time to get back into the emerging markets? they've been beaten down for so long now. we'll have a contrarian come through here once in a while and say, yes, i think it's time to get back in it. plenty of people say, i wouldn't touch the emerging markets yet. what do you guys say? >> i say you really want to think about emerging markets in this kind of environment. you need to think about individual countries or countries that have certain

characteristics like those that are linked into recovery in europe or stronger growth in the united states and the housing sector and energy. or those who are more closely linked to china supplying commodities who may have poorer prospects than the others. it's much more differentiated picture than thinking about em per se. >> what would be one of your favorite choices right now? >> one of the favorite choices is probably korea simply because out of an economy that's open, linked into recovery. but ones that are actually running right now are some of the ones that dog the just a few months ago like india. >> all right. anything else, kelly? >> i was actually going to ask about japan, but i feel like that's just opening a whole other can of worms. >> yeah, we don't have that much time. >> let me put it this way. if the tax hike happens in a matter of days here with regard

to japan, how much of a problem? can you put it in 140 characters? >> it's all a question of how quickly the boj responds with the easing and how effective the fiscal stimulus is at offsetting the falling consumption. >> all right. #goodjob. >> thank you. >> thanks for joining us. heading toward the close. i wouldn't call it a rally, but we're back in positive territory for the dow. up 4 1/2 points. the nasdaq is coming back, still minus signs right now. >> and after the close, microsoft's new ceo unveiling windows office for the ipad. will it be a big boost for the company's bottom line? if so, why is microsoft stock down today? stay with us. that story when we come right back. back. announcer: where can an investor

be a name and not a number? scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: ranked highest in investor satisfaction with self-directed services by j.d. power and associates.

once wrote something on a sheet of paper and placed it in his factory for all to see. ♪ four simple words where the meaning has never been lost. the challenge always accepted. and the calling forever answered. ♪ introducing the all-new 2014 s-class. mercedes-benz. the best or nothing.

welcome back. so we're heading towards the end of the first quarter, bill. we're doing so on a rocky note. markets are lower again today. generally the dow is off about four points this hour. the s&p 500, if it closes below 1848, will be negative for the first quarter. >> not exactly the window dressing you would imagine at the ends of the quarter. sheila, what's moving these markets? >> bill, you have to talk about some of those momentum stocks,

especially in the nasdaq. they continue to fall. priceline, amazon, tesla, and netflix all to the downside. but social media stocks are faring better. twitter signed a data sharing project, all moving higher today. tough session for gamestop. the company falling after reporting weaker than expected fourth quarter earnings. it said it would close 2% of its stores. finally, three companies making a successful debut on wall street. square 1 financial, applied genetics, and trinet all safely in the green on their debut. trinet's chairman and ceo will be jim cramer's guest on "mad money" tonight 6:00 p.m. eastern here on cnbc. bill? >> all right, sheila. thank you. just to follow up on yesterday's disastrous ipo, king digital, which turned out to be the worst ipo of the year so far. down another 3% today. the candy crush gang still not buying this stock here.

heading toward the close. 14 minutes left in the trading session. down four points on the industrial average right now. >> yeah, i was just going to say that, company looking more and more isolated. as these other ipos today, they've done all right. still to come uubs wealth management chief investment officer alex friedman is going to talk money. we'll be right back. l be right ) defiance is in our bones. defiance never grows old. citracal maximum. calcium citrate plus d. highly soluble, easily absorbed. [ chainsaw whirring ] humans -- sometimes life trips us up. sometimes we trip ourselves up. and although the mistakes may seem to just keep coming at you, so do the solutions.

like multi-policy discounts from liberty mutual insurance. save up to 10% just for combining your auto and home insurance. call liberty mutual insurance at... [ thump ] to speak with an insurance expert and ask about all the personalized savings available for when you get married, move into a new house, or add a car to your policy. personalized coverage and savings. all the things humans need to make our world a little less imperfect. call... and ask about all the ways you could save. liberty mutual insurance. responsibility. what's your policy?

we got ten minutes left in the trading session here. the dow down five points. just been fluctuating on either side of unchanged here. it's been one of those days. it's really been one of those couple weeks we've seen this indecision in the markets. joining us right now is alex friedman, global chief investment officer at ubs wealth management. you manage half the world's money right now it seems like. >> not really, but thank you. >> what do you make of what's going on? as we come to the end of this first quarter, we have seen this sideways action, really, compared to last year's stellar gains. what's the market message right now, do you think? >> i think it's one of uncertainty. we saw big question marks in the three major market drivers.

first, what's happening in europe through the issues in russia. second, what's happening in china. is there going to be more of a hard line than we thought? third and perhaps more surprising was last week the fed. are we going to see tightening faster? no surprise there was a bit of soul searching and uncertainty right now. >> you know, alex, given that's the case, i just wonder where people should be looking. do you follow the market here, or should you fight it? no you see what's happening with the 30-year treasury bond. it seems like there's a bit of a rotation happening within sectors. is that something that you -- should people friend or fight this trend, do you think? >> i think there are two answers. first, stick to the fundamentals. the u.s. is recovering. u.s. equities, u.s. high yields, they look attractive. u.s. dollar looks pretty attractive. europe is on a recovery path. china, for all the noise, is handing off from the visible hand of the state to the invisible hand of the markets and should defend its 7% target.

second, take advantage of this fear we're seeing in the market right now and stay away from this safe haven asset. we've seen the swiss franc go up. those are all moving opposite of what the fundamentals tell us. keep your eye on the global recovery. >> you see the dollar going higher. that traditionally does not bode well for the u.s. stock market here. so how do you -- if you're going to invest for growth, yes, the dollar is going to go higher, but can the u.s. market follow suit as well? >> yeah, i mean, the dollar should move due to two dynamics. one is a slow normalization of what had been an unusual easing policy. second is a recovery and the underlying economy. if the dollar moves too much t will weaken the recovery. that's what we're seeing in the u.k. where the pound has moved so much it's starting to put a drag on earnings. we're nowhere near that level. >> let's be specific then. as far as this dollar strength you see, is it the shallow glide path, to use janet yellen's term, or do you see a pop in the u.s. dollar here?

>> i mean, it's a good question. i can't say i can call short-term currencies like that. the fundamentals say the dollar will strengthen against the euro. i would be short the euro and shorted swiss franc. >> it will depend on fed policy, won't it? >> yeah, but i think we have a fair amount of visibility on that. i think the six-month comment from yellen was if not a mistake, not what she intended. she's saying, yes, we're going to normalize interest rates. it's going to take a while. somewhere between '15 and '17 this is going to happen, but it's not going to stifle the economy. >> alex, do you own any bitcoin? >> no, i don't. should i? >> well, i don't know if you heard. bill miller was just with us. he owns bitcoin. >> a lot of smart investors own bitcoin. we're trying to steer almost $2 million. probably not the right asset class for us. >> he bought it as sort of an

intellectual property. >> bill miller is a smart guy. i better go back and review what he said. >> we'll be seeing bitcoins in the ubs portfolio at some point. alex, stick around. we'll be talking with you. kelly, see you at the top of the hour with more of the market coming up in a few minutes as we head towards the close with about six minutes left. the dow is up about eight points. >> yes, and right after the bell, it's a special 4:00 edition of "closing bell." i'm at the rise forum in dayton, ohio. there's a look at what's happening on stage behind me. it's home to the largest student investment conference in the world. it's been going on for about a decade. find out what's on the minds of these millennials and how they view wall street and the stock market lately. keep it right here. you're watching cnbc, first in business world. wide. wide. percent or more on car insurance. everybody knows that. well, did you know bad news doesn't always travel fast? (clears throat)

hi mister tompkins. todd? you're fired. well, gotta run. geico. fifteen minutes could save you fifteen percent or more. in a we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present.

became big business overnight? ♪ like, really big... then expanded? ♪ or their new product tanked? ♪

or not? what if they embrace new technology instead? ♪ imagine a company's future with the future of trading. company profile. a research tool on thinkorswim. from td ameritrade. three minutes left in the trading session here. i mean, this trading pattern has become very familiar in the last couple of weeks. just this choppy volatility. this is the dow for today. unlike the last few trading sessions where we had this rally in the open, a slight selloff, then we came back. but it's sideways for the most part. we're down four points right now as we head toward the close. the nasdaq once again has been the weakest of the major averages here because we're seeing a lot of these momentum

stocks pulling back. they've had a lousy first quarter this year. so we're calling this a stealth correction. the amazons, the netflix, priceline, tesla. facebook down for the quarter. a lot of these are down more than 10% for the quarter. they've had their own correction, if you will, in the first three months of this year. still here with alex friedman from ubs wealth management. we're coming to the close of this first quarter, which has not been great. i mean, the s&p is literally unchanged for this first quarter. what do you see for the next three months in this market? >> well, i think first of all, the geopolitical risk will come down. i think we'll stop talking about russia too much. the china worries will come down. we'll start coming back to the u.s. story of, are we seeing cap-ex accelerate? if so, is that going to drive earnings? i expect we head in that direction. we see ten-year start to move towards 3%, something in that neighborhood.

>> i was going so say, how much will fed policy and especially interest rates play into the story of the stock market? logic would suggest that if it was the easy money policy that gave us the big gains we saw the last few years, you would think that as they slowly reverse that, the stock market would reverse itself. do you see that happening? >> yes, it would happen if you don't see earnings acceleration. that's the cap-ex story. if we see the slack come out of the labor market and confidence returning, both of which are happening, and you don't see housing undermined by interest rates skyrocketing, then the ingredients are there for a 6% to 8% equity return this year. if you see a big worry about geopolitics, then people say there's a big question mark on all this. i don't think that's going a story. >> one high-profile sector you think would do well, the financials. do you like them? >> yeah, i do. i like the financials for a couple reasons. one, i think you've got interest rates moving the right direction for financials. second, it's quite attractive.

you see people with confidence buying more stuff. >> alex friedman, thank you. appreciate it very much. we're going out with minus signs again. in the meantime, stick around. more from the rise conference in dayton, ohio, with kelly evans and company on the second hour of "the closing bell." see you tomorrow, kel. >> thank you, bill. welcome to "the closing bell." i'm kelly evans coming to you from the rise forum on the university of dayton ohio campus. let's start with the markets and focus on how we're finishing the day on wall street. as bill just mentioned, looks like another negative close. dow is losing five points here as we ring in the finish. the nasdaq is off 22. the s&p 500 off 3 1/2 points. if that holds, it looks like it will just eke out a gain for the quarter. of course, the quarter ends monday. we'll see what happens after this weekend. let's get to it with our

"closing bell" panel today. stephanie link is here with me in dayton. our michelle caruso cabrera and john fort holding down the fort at the big board. also with us, "fast money" trader brian kelly. i guess we have to start with you, brian. this rotation in the markets, what's driving it? what do people do here? >> actually, you started to see kind of a reverse rotation today where names like facebook, tesla to some degree, but other names, momentum names, came down to big weekly support, support lines that have been there and trend lines that have been there for six month, eight months and they turned and burned. then you saw names like cisco and microsoft come off. you're starting to see that shift back to the momentum names and the nasdaq 100 held above some key levels. it's one day. one day doesn't make a trend. but we definitely had a day today where we put in a very

short-term bottom, it appears. >> john fort, when people arie k looking back, it's clear it's the nasdaq, the small caps where we're seeing the weakness. what do you glean from the screen in front of you? >> i see blackberry closing below $9. that's a key level i've been watching. they had a downgrade today. that's part of it. earnings from them tomorrow morning, which is another issue. not sure what kind of numbers we'll get there. also, as bk kind of mentioned, i feel some optimism seeping out of some of these names. we had office for ipad announced, but microsoft didn't break above $40. and some other names with good-ish news. intel announcing a partnership. that didn't get it moving at all either. with all that and what happened with king, you got to wonder if there's a little bit more of a turn toward pessimism all the sudden. >> well, and welcome to sarah. you guys manager something like

$28 billion. what are you doing with the funds right now? where do you see value? >> well, we definitely see value in microsoft. it's significant holding in our global fund. today's news was good, but the market is a discounting mechanism, and a lot of that good news has already been priced in. this, i would say, is true across the board, across many markets. we're focused on very special situations. companies that have lagged the indices in every market and perhaps the most interesting place in the world now is the emerging markets. they're certainly the most beleagu beleaguered. >> well, that's true. we'll definitely get to that in just a second. stephanie, there's been so much talk out here, big picture, about how markets are evolving, how strategy, how finances have been. when it comes down to it, people want to know, please explain to us what's going on in the market today and what do you think here? >> i've been saying for the last couple weeks i think the market is in a trading range. the economic data points are getting better. today i was pretty encouraged with the initial claims and even

in the gdp number you saw consumer spending levels on an annualized basis not seen since 2010. these are good things, but what it means is the fed is going to continue to taper. they're going to tighten at some point. might come a little sooner than expected. and the markets are going to have a hard time dealing with that. what we need to get through is the next couple of weeks, then we're going to hear earnings. that's going to be, i think, the next catalyst. i think earnings are going to be better this year because the economy is getting better. you'll see better top line, not just margin improvement. >> what's so interesting, it's the very point bill miller just made, which is maybe the reason why all these growth names are underperforming and value is doing a little better in this environment is because suddenly people see the prospect actually for more decent growth. so in other words, a wider array of names that might take advantage from a rising, you know -- a better economic environment. >> in particular, if you get business investment spend, cap-ex spend, those enterprise boring technology, stocks

couldn't continue to do well. >> michelle, that's one place people have seen exposure to some of the fed liquidity going away. i hate to lump them together, but how vulnerable do things look here? >> brazil, russia, india, china. russia is potentially looking at a recession. getting worse every day. brazil is not growing anymore. not like it used to. of course, we're all worried about china. so if you think growth is going to be better here, and a lot of people do, then it makes sense. but keep in mind, this market may be discounting in a lot of that, and we have seen selloffs in thosing other markets. when you look at the breadth here, kelly, this market has a case of bad breath. you have the s&p still near its highs, but a lot of the midcaps and small caps are at multiweek lows. a real divergence. >> it's interesting, kelly. you have seen some investors taking money off the table in some financials, putting it into commodities. look at the mining stocks.

they've been on a tear in the last couple days. and look at energy. look at the emps, those companies. it's been interesting to see this rotation. it's on that theme of emerging markets, just too cheap to ignore. >> that's true. sarah, where do you see the most value out there? you talked about these perhaps contrarian calls in emerging markets right now. >> for fear i just burst into flame, i would mention we're overweight china and russia, which does sound terrifying short term, but the valuations of china are incredibly attractive. and even in our more developed market portfolios, some of these stocks such as the third largest oil company in china, the one that has a monopoly on offshore drilling, is an incredible bargain. something like five times cash flow. if you turn to russia, yes, it's awful, the situation, the political upheaval. but this is temporary. to the degree you're willing and able and brave enough to buy now, you can get stocks at 2 1/2 to 3 times cash flow.

>> jay carney said if you own russian stocks, you should think about selling them. >> that was a buy signal, kelly. >> i guess it depends on your investment time frame. but if you're willing to look out more than a year, there's never a better opportunity to buy than when people are nervous. >> do you own gas prom then? >> we do. >> what happens if the u.s. government says, you know, we're not comfortable with people supporting the russian state? >> well, again, i get back to the market being an incredibly efficient discounting mechanism. the share price has been destroyed. underneath that, you have a company with reasonable financial strength and markets all over the world. clearly europe is important. but all of this will be resolved. each side, both europe and russia, they need each other. so we just don't see this as a wipeout for russia. and they have quite a promising future beyond this dispute. >> that's fascinating.

the energy story is going to get a lot of play, of course. different things going on. stephanie, you mentioned something i wanted to ask about, health care. one of the reasons why consumer spending was so strong in the fourth quarter was spending on health care. it was spending on hospitals. you know, it's a little hard to figure out, should people be getting more exposure to this space or worried about some of the pullback we're seeing after the run up in this sector? >> if you look at some sectors in health care, like the biotech sector, it was up 65% last year. you have to be very valuation centric, very focused on with where you can find what other people just don't want, right. i still think that there is value in the hmos, particularly with the affordable care act. i still like the pbm space very much. because i do think that they're going to benefit from the affordable care act as well as generic penetration. so something like a cvs.

but you have to be very careful in health care. there are much better bargains n my opinion n the industrials, in the energy stocks, even in technology. i think the risk-reward is better. >> real quick, brian kelly, what about financials? what about citigroup? >> i'd rather be in the names that stephanie was talking about because the next lag of the bank rally is dependent upon the economy getting better. that's already priced into something like a bank of america, up 40%. i'd rather buy the call names. i'd rather buy cleveland cliff, cls, something like that that's going to benefit from the cyclical upturn. >> we're getting real crazy. we getter go before some real zingers come out. thanks, everybody. be sure to stick around and catch brian kelly and the rest of the "fast money" crew at 5:00 p.m. straight ahead, growing the economy and creating jobs. that's what indiana's governor mike pence is focusing on. ge aviation is building a big

production facility there. up next, he'll lay out his strategy for success and where his state is on the minimum wage issue. it's currently $7.25 in his state. also, the maker of candy crush not making up the ground it lost on yesterday's debut. is the poor performance unique to this ipo or the sign of something bigger? and u.s. government once again denying citigroup's plan to raise its dividend and buyback stock. does citi need to regroup and change key personnel? your best tweets on the subject coming up. @cnbcclosingbell is the way to reach us. keep it here. you're watching cnbc, first in business worldwide. siness world. make it happen with fidelity active trader pro. it's one more innovative reason serious investors are choosing fidelity.

call or click to open your fidelity account today.

welcome back. let's send it over to sheila for a quick market flash. sheila? >> red hat moving higher in the after hours. the company posting better than expected fourth quarter earnings. revenue in line with forecast. now, remember, red hat provides solutions to enterprise customers worldwide. that stock currently trading at 58.39, up 4% in the after hours, kelly. >> sheila, thanks for much. over a million veterans are currently unemployed and now some of the biggest names in the corporate world are coming together to hire our heroes. mary thompson has the details for us now. mary? >> hey there, kelly.

as you said, the program is called hiring our heroes. it aims to match skilled veterans with private companies like cnbc's parent comcast, jpmorgan and staples. these firms and over 100 more taking part at a job fair today in new york city. hiring for heroes holding over 680 of fairs over the last few years. but fairs are only part of the strategy. partnering with toyota, hiring our heroes created a resume engine for vets that makes them more marketable to potential employees. here's toyota's don esmond. >> allows our military vets to go in, put their military occupation skill, every single class they've attended and then translates it to civilian terms. >> available to any company online, the resumes can be sorted by skill and zip code so firms can quickly zero in on the right candidate. veterans can also attend classes on interviewing and resume

writing at the fairs. there's a satellite program that's been funded by capital one, but it's pressing firms to hire half a million veterans by 2015. so far they've committed to hiring over 400,000. 250,000 of those veterans already on the job. so why hire a veteran? well, employees say they're self-starts, they work well in groups, they're prompt and trainable, and there's a lot more entering the work force. and estimated 1.5 million will be entering the private work force over the next five years. so programs like hiring our heroes will be increasingly important to this community. back to you. >> yeah, absolutely. mary thompson, thanks very much. hiring and jobs definitely on the minds of many americans as connecticut lawmakers pass legislation to increase that state's hourly minimum wage to $10.10. that will be the highest of any state in the union. my next guest keeping an eye on all of this as he fosters economic growth in his own state where they keep to the federal minimum wage of $7.25. indiana republican governor mike pence with me now in a cnbc

exclusive. governor, welcome. it's great to see you. >> thank you, kelly. >> so you've just come from the forbes reinventing america conference. why isn't a higher minimum wage part of reinventing this country? >> look, i want everybody in indiana to make more than the minimum wage. we've been promoting policies in the state of indiana that are creating real results. we have the lowest unemployment rate in the midwest. yesterday we were able to additional corporate tax reductions to -- reductions in our individual tax rate and an end to the death tax last year. i think the policies in indiana are contributing to the kind of growth we're seeing in the manufacturing sector. yesterday ge aviation announced plans to build a factory in lafayette, indiana, that will pay more than four times the average minimum wage. so we're going to keep promoting those kind of policies as the debates in washington, d.c., go forward. in indiana, we think we've got a

winning combination of fiscal responsibility, pro-growth policies, sensible regulation, right to work, and indiana's growing as a result. >> well, and as you say, the kinds of jobs, these ge aviation jobs are the best way to increase wages. obviously that only applies to a part of the work force. and it's not even that you guys aren't pushing forward to raise the minimum wage. you've actually as of last july have your local governments prohibited from allowing businesses to pay a higher minimum wages or offer any benefit like paid sick leave that's not mandated by state law. >> well, i think the key in indiana is that we're really focused on making sure that the work force in indiana, though, also has the background and education and skills and industry training necessary to get the good-paying jobs that we have. you know, even though unemployment is still too high in indiana, the reality is that there is a skills gap in our state. i just came from a stop. there are jobs available today in the hoosier state that are

not going -- that are going unfilled because people don't have the background, the training, the skills, the industry certifications to fill them. that's one of the reasons in indiana. we've embarked on an effort to make career and vocational education a priority in every high school in our state. you know, i honestly believe that better education, particularly work force, vocational education, and the kind of policies in indiana's advancing are the best way to good-paying jobs and to raising the income of hoosiers and really all americans. >> right. i guess the only thing i'm wondering here is when you think the minimum wage is a nonissue or raising it would have a deleterious effect on your state. >> well, i think the minimum wage is really designed to be an entry level wage. it creates a floor, a threshold, if we will, for people entering the economy. my focus as governor of indiana is on advancing the kind of policies that will create more good paying jobs that will raise

the income of hoo chsiers and advance and grow their careers in our state. in indiana, we're one of the few states that has a aaa bond rating. we have nearly $2 billion in reserves. we're cutting taxes. that's a pathway toward creating opportunity over and above the usual debates in washington, d.c. >> to that point, one thing that really caught my attention is the fact that there is an indiana economic development office in berlin. germany is like the third biggest provider of foreign investment in indiana. i know you're going to be headed there on a trip soon. i mean, how did that happen, and are you looking at pursuing more specific tie-ups overseas with your state? >> well, we really are. i've only been governor since

january a year ago. but we made a point to travel first to japan because we have more than 250 japanese companies that employ thousands of hoosiers. and we're going to be headed in just a couple weeks over to germany because, as you pointed out, german companies are a very significant part of the indiana economy. we just think indiana is the best place in the midwest to start a business or to grow a business. we're talking to companies across the country and across the world. i'm looking forward to stopping in to our indiana office in germany, but also stopping into a lot of german companies and telling them why the hoosier state is the place to be and to grow. >> yeah, well, look, they have some tough issues to deal with as well as the moment with regards to russia, the rest of the european union. so guess they'll have to make room for indiana in the midst of that, governor. thank you for being here. >> thank you, kelly. good to be with you. >> that's governor mike pence of indiana. at long last, microsoft unveiling its office software more ipad.

how much that could mean to mic microsoft's bottom line and if it will help this stock rally further. sfwlrch and has the rough debut of king digital broken this market's ipo fever? we'll talk about this issue coming up in a moment. ng up in . (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) ranked highest in investor satisfaction with self-directed services by j.d. power and associates.

so our business can be on at&t's network for $175 a month? yup. all 5 of you for $175. our clients need a lot of attention. there's unlimited talk and text. we're working deals all day. you get 10 gigabytes of data to share. what about expansion potential? add a line, anytime, for $15 a month. low dues, great terms. let's close! new at&t mobile share value plans our best value plans ever for business.

sometimes they just drop in. always obvious. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances. welcome back. it's been four years since apple released its first ipad. now microsoft finally unveiling its office software for the popular tablet. morgan brennan keeping an eye on all this.

what is it going to mean to microsoft's bottom line? >> reporter: well, this could be big. at the very least symbolically. microsoft finally launching offices for ipad today. that's going to include excel, power, and word. we saw this debut in the app store this afternoon following the event. actually, apple ceo tim cook tweeting a welcome to nadella in light of this news. anyone can download to their ipad to view documents and give presentations. only office 365 subscribers will have full access and actually be able to edit. so take a listen to what nadella himself had to say about this. >> today the fact that anyone who's an office 365 subscriber can get access to those beautiful applications on the ipad and do more is definitely the news of the day, but you can expect us, our commitment going forward is to make sure that we drive office 365 everywhere.

>> reporter: now, this represents a big step towards what experts are calling a more agnostic microsoft that's potentially less tethered to windows. nadella himself saying this is only the beginning. expect more announcements in the coming weeks as he rolls out his, quote, innovation agenda. that's going to be involving mobile and the cloud. next announcement is expected regarding windows next week at the company's builder developer conference. kelly, back to you. >> morgan, thanks very much. i definitely want to get thoughts from the panel here. john fort, look, we discussed this in the weeks leading up to this event as to how much nadella was going to have to give away for free and what this is going to mean for microsoft. what is your reaction to the fact that, you know, you can only basically download or view, that is, content on these new microsoft office -- on this new software. if you want to edit or create, you need to be an office 365 subscriber.

>> yeah, kelly. he's not giving away much, which means they're not going on the backs of this particular announcement going to launch into probably being the most popular productivity apps in apple's app store. this is really geared toward business customers, some of whom might already have office 365 accounts within their organizations. maybe they're just not using them. this will certainly get some who might have some of these office apps in their organizations, which is a lot of people, to say, hey, why don't we sign up for this subscription plan because i want to be able to use this on my ipad. the sales team want to use powerpoint and create from that. i don't think this is necessarily going to provide a big topline boost for them in the short term. >> michelle, would you pay for office 365 to have access to these tools? >> well, you know, that's a good question. i was wondering about that. using these products on a tablet is pretty tough generally, right? they use a lot of computing power. they're really designed for a desk top.

my question is, is this just some kind of remodeling of something that was designed for the desk top and is now being imposed on the tablet? the next phase for tablets is when they think of stuff that is designed primarily for that tablet and is just not some re-creation of an old software or old platform in an old way of thinking. >> actually, they've done a beautiful job. >> are you looking at it right now, john? >> i am. i kind of called it up here. >> let's see it. >> you have your excel. you've got -- see, nice little logo there. >> you use a keyboard. i don't carry a keyboard around. >> i keep my keyboard attached. i use it like a laptop in a lot of cases. >> it doesn't have enough power to do that. >> it does, actually. it's faster than what -- >> oh, it does. >> they've written the software specifically for this. >> stephanie, why is the stock down today? is it because of this issue with regard to what, you know, the fact you're going to have to

subscribe? is it just by -- >> the stock has been a champ along with old tech, if you will. i think that this is good news for both parties. i don't think it's a needle mover for either of them. maybe it stimulates a little more ipad demand. ipads are actually decelerating. maybe it stabilizes there. it's certainly designed for the business environment, but more importantly it's nadella making partnerships like he needs to. this is very symbolically positive in that it sounds like he's willing to partner up with others. that's a good thing. >> sarah, what do you say? microsoft was a name that had basically not moved for years. it really has ramped up in the last year or so. is it value? is it growth? what do you do with it here? >> i could certainly add to this conversation that i run a business. it's been very challenging seeing the whole analyst pool move to using a tablet and

having i-works incompatible. this is huge for us. i think i could speak for enterprises everywhere who are predominantly microsoft customers. this is fantastic. so it may not -- there are a lot of negatives that come with it. for example, accelerating the decline in pcs and a lot of capital expenditures, investments spend. microsoft has to focus on the cloud, for example. but this is great for businesses. we'll all end up paying at the margin more for this compatibility. so all good for microsoft. >> last question then. you know, it sounds like you guys, again, looking positively in terms of your business. but do you like the shares here, sarah? >> yes, yes. although, they've had a 45% or 44% run from 12 months ago. the market have been very efficient at discounting good news. that's not to say there won't be more in the future. and think about it more in terms of cash flow.

just limitless amounts of cash flow coming out of microsoft. they sit on $77 billion of cash. they generate tons of cash every year, even after the increased capital expenditures. that will come to shareholders. so instead of thinking about microsoft as this exciting growth stock, think of it more as a cash jgenerator with a decent 3% yield. that more describes the microsoft of the future, in our opinion. >> all right. we'll leave it there. thanks, guys. up next, we're talking to some of the brightest financial minds at dayton university, including one student who just won jim cramer's next great stock picker competition. and citi shares crushed after the fed rejected its dividend and stock buyback plan. should investors be worried? we want to know what you think. we'll reveal your best tweets coming up on "the closing bell." "

we know we're not the center of your life, but we'll do our best to help you connect to what is.

and the big men on campus these days are clearly the university of dayton men's basketball team, shocking the ncaa tournament and playing in the sweet 16 tonight against stanford. but as if that wasn't enough, the hoop sters aren't the only

students gaining attention around campus. here are the the rise conference, we've come across three future investment stars, all of whom are studying finance at ud. we brought them here. we want their take on markets and the future. they all join us now. welcome. >> thank you. >> so do you manage your own money? i know you're involved with the university. how many people here have a portfolio as well? do you manage -- do you put your money in the stock market? >> absolutely. >> and you won jim cramer's stock picking competition. tell us what that was like. >> so i submitted a one-minute video. it was a great competition. i pitched windham worldwide corporation, one of my favorite stocks. i was lucky enough to be

selected. i didn't expect that. in june, i'll get to go out to new york and visit jim cramer and the street. that's going to be an awesome opportunity. i'm really excited. >> you'll have to come say hello when you're down there at the exchange. hussein, you guys also work on -- you have a chunk of the university's endowment that you manage. where do you -- how do you invest it? >> basically, they have a center. my job is to try to build intrinsic models and make everyone believe the models we make are legitimate and our assumptions work. we work from the bottom up and present it to our investment team. then the economics team presents it top down. then we collaborate twice a week and clash heads. all three come up to a decision. >> what's an example of something you've built or discovered throughout this process? >> for example, most recently we built a free cash flow model using the perpetuity growth method. currently trading around 240, at the end of today 250.

our models predict they can go as far as 314. room for that value growth. >> what dot you interested in finance? >> i grew up, a lot of people in my family were involved in finance. it's something that really interests me. when i came to the university of dayton, the davis center kind of caught my attention immediately. i got involved, and i'm on the tech sector. basically, we just try to look for trends. obviously technology, there's so many trends now with mobile, security, cloud. >> do you all use whatsapp, by the way? >> i personally don't, but it's been a lot of buzz. >> do you? >> no, i don't. >> no one here? >> is i used it once when i went overseas two years ago. it was the only way i could connect back to my friends back home. >> good point. now, you said you do the tech sector specifically. maybe you can tell us what amazon is worth. >> oh. >> there's not an answer to that one, i'm convinced.

do you look name by name? what's been most interesting to y you lately? >> we try to look for trends growing. personally, i love 3d printing. call me crazy, but it's a volatile industry growing really, really fast. valuations are a little stretched, but i think the trend is there. it's the future of technology. as we see printers trickling down into the hands of consumers, i think it's going to take off. definitely poised for growth for the next five, ten years. >> when i was finishing college, it was basically graduating into the peak of the last cycle. there was a lot of excitement around wall street and what was happening. very different for you guys. i wonder if you can talk about what the perception is of wall street. is it positive, negative? >> i think it's getting a little better. for us, we are in a consensus it starts with us. we're the next generation of wall street. we want to be the people that come up and we're ethical and we're doing things the right way. always have the consumer first and the client first. so -- >> you're already talking about

clients. >> just the nature of the business. i hope one day i can be successful and do things the right way. it's definitely my biggest goal. >> do you, hussein, ever get -- i know it's always a little bit different, not as if you're gathering around and talking about wall street every day or maybe you are, but what is the perception and why do you want to work in this industry? >> perception among peers, specifically people not in the school business, is these guys are just in it for the money. as we get together, i believe that as a new generation, the future of finance, we could work together and definitely change it and actually reach out and not just be hungry for money. >> and is it a motivation of yours as well to kind of get more people interested and involved? does have that something to do with the appeal for you? >> i'm actually a psychology minor. i kind of like the twist of adding in that little bit of psychology into the markets and letting people know it's not just strictly finance. you can add other things into that and take it the way you want to. >> and go flyers.

does that go without saying? i have my t-shirt already. after this rise forum is over, they're going to be showing the game on the big screen here behind me. i don't know if you can hear that, but there's a big crowd here. we will definitely say go flyers, even though you upset syracuse. sorry, mom. thanks to all of you for your time. i really appreciate it. fascinating to get a look at the next generation. now over to sheila for a quick market flash. sheila? >> we heard the screams. we like the t-shirt. let's talk about exact sciences. it is higher in the after hours. that stock reopening after its colon cancer screening method won unanimous backing of an fda panel. now, this does prove the way for a potential regulatory approval. stock currently trading at 14.31, up about 4% in the after hours. >> all right. sheila, thanks very much. the ipo market had been red hot this year. keyword, had. yesterday, king digital saw its ipo get crushed in its debut.

we'll discuss if investors are losing their appetite next. and a new review of the bridgegate scandal has cleared governor chris christie of all wrongdoing. that will not be the last word on this. we'll tell you why coming up. w.

what a tough couple of days it has been for king digital,

the maker of the game candy crush. seema mody, does a bad debut necessarily mean bad long-term performance? >> a number of ipos have slumped in their first day of trade. here's the thing. many have been able to stage a comeback. take gogo, for example. the in-flight internet player. it was down 6% in its first day. now up 34% as more customers bring wi-fi devices on board and use gogo services. william blair also says international expansion will be the opportunity or the catalyst that helps shares outperform in the coming months. avg tech, life lock, wife wave holdings have also staged a comeback after shares fell on their first day as a public company. it's a slightly different story for facebofac facebook, right? had a rough couple of months. shares did recover as it made a big push into mobile. and another trend that we noted, after these companies put out

their first earnings report as a public company, more often than not shares moved higher, indicating that investors looked at the numbers, got more comfortable with the management, the street then felt more comfortable getting into these names. for those watching king digital, that might be something to watch. kelly? >> seema, thanks very much. we want to now talk more about the outlook for ipos this year. joining me now, our own bob posani and gene arkin. so bob, what about you? we had a couple of other ipos today that went off pretty well. >> there's a big sigh of relief. all three ipos had double-digit gains today. the concern yesterday was good heavens, king was just a disaster and a mess. is this the start of the end of the ipo boom? now the story seems to be king was an anomaly. king was a problem by itself. they don't like the whole game business. traders shorted the stock very heavily. and that was the problem. the ipo business looks all right. got five of them coming tonight,

kelly. >> five more, gene. the deluge. >> yeah, that's right. i mean, with regard to king, you know, clearly every company and ipo is different. you know, what does this tell me about king? it really doesn't tell me much other than that the ipo was mispriced. you know, the reality is that if the company proves out its business model and shows that it's not a one-hit wonder, i think that they'll flourish. >> i want to get a take from the panel here as well. stephanie, so, is this a story about king, or is this a story about the ipo market more broadly? >> way too much supply coming out. and what's interesting is some of the more mature biotechs or some of the more mature cloud plays, they're now down 15%, 16%, 20% from their highs. and they, by the way, have mature businesses, but they still have growth. they've proven themselves. i think it's getting too competitive, but i do think that

some of these deals are getting priced much too aggressively at this price. these bankers need a reality check in my opinion. >> john fort, what does that mean for the people who want to come in behind? >> i think it means there's a quality issue potentially. you look at king, it looks like it was priced as if it's not a one-hit wonder, but they haven't proven that yet. you look at box, which is going to come to market. it looks like they're doing it because they have to, not necessarily because they've got enough of the kind of track record of actually being on the route to make money. i think there have got to be questions now. if you want a quality company, maybe you want to get it out there. if you don't, maybe the market is not going to be so forgiving just because the window is open. >> why does everybody have the right to a huge first-day pop? what is that about? you think it has to go up on the first day? i'm going public. i want every dime. if it rises $20 on the first day, that should have been my money as a ceo to invest in the company. >> but ipos that break price,

it's very hard for them to come back unless it's a really special situation. and they might come back, but it might take a long time. >> well, you should be -- so the special broker who got you the special allocation, you're going to think twice next time before you're a sucker. >> that's what i said. the bankers need to get a reality check on the pricing. they know the book. they see who's involved in these names. they know the quality of the book too, by the way. they know if it's flippers or long-term investors. i think they're too aggressive. >> what were you going to say, yeen? >> kelly, this is gene. 2013 was a fantastic break-out year for ipos. you know, in addition to that, you know, it's going to continue to be that way. you know, the end of the day, the ipo markets are driven around the confidence of the markets to assume the risk, which is clearly there. and the equity markets are still really strong, which is why we're seeing most ipos price at or above expectations and still

very attractive to a private sale. >> i think the weakness -- >> sarah, i imagine the response -- go ahead, bob. >> i think the weakness we're seeing stephanie is referencing in some of the more recent ipos, remember, these companies are paying for growth. people want growth. any kind of growth at all. now hopefully the economy is improving. some of these growth names we've seen this month that are weak, i think, are signs that the economy might be getting better and people are rotating more into the old names. i think it's a sign of economic strength. >> and bob's making a great point. you know, in this market, you know, when valuations get frothy, investors get disappointed really quickly. so companies are going to have to prove out their business models and show that they can perform. >> yeah, just real quick, sarah, on this point. are you encouraged by the fact that a company like king, which maybe the business model isn't something the street liked at the price that was offered, et cetera, that happens. we see other ipos doing okay.

in other words, we see rationality. >> poor companies are the exception, not the rule. for the most part, we're seeing healthy revenue generating companies seeking ipos. in addition, you're seeing a lot of companies that have been in private hands for a really long time who are now entering the market in a more mature stage of their life. sarah, you agree? >> yeah, and furthermore, although, as a value investor, i couldn't comment on king. i'd have to say the ipo market's health is a good sign for the markets overall. to the extent investors become discriminating, that's also a good sign. we want rational exuberance. >> this is particularly true in the biotech area. she's right about the mature companies. >> bob, gene, thank you. >> thank you. >> okay. >> we got to leave it there for now. the report is in, so the question will be, it's weather new jersey governor chris christie will pay a toll for bridgegate. the answer next and why some

reject this report as the final answer on the matter. and a bad day in the citi. stress test failures have some folk wondering if they're sleeping on the job. tweet if folks there are sleeping on a job. tweet us how much of a regroup do you think is needed at citigroup. citigroup. ♪ ...work with equity experts... ♪ ...who work with regional experts... ♪ ...who work with portfolio management experts, that's when expertise happens. mfs. because there is no expertise without collaboration.

mfs. geico motorcycle. see how much you could save.

we still run into problems. that's why liberty mutual insurance offers accident forgiveness if you qualify, and new car replacement, standard with our auto policies. so call liberty mutual at... today. and if you switch, you could save up to $423. liberty mutual insurance. responsibility. what's your policy?

a new report detailing new jersey governor chris christie's involvement in bridgegate. while it answers some questions, it raises a host of others. scott has been poring over the report. >> here is the report. a lot of reading. it's 360 pages long. and the former aide that wrote it said governor chris christie's involvement in the infamous bridge closings in september was zilch, zip, nada. >> governor christie had no involvement in the decision to close these lanes. and no prior knowledge of it. >> so, who did? former christie allies bridget kelly and david wildstein. they were targeting the mayor of ft. lee. but the motive is unclear. and are on charge under the

mayor of hobokehoboken, false. the critics say it's a whitewash. the mayor of hoboken calls it predictable. the democratic national committee says it's a sham. and the top democrat in the new jersey legislature promises this won't be the final word. >> he did what the governor paid him to do. but it raises many more questions than it answers. >> it serves no one's interest, not ours, not the governor's, not the governor's office, and not the constituency the governor's office serves, the people of new jersey, for us to have tried to do anything other than uncover the truth. >> worth noting that many of the key players declined to be interviewed. bridget kelly, david wildstein, christie campaign manager, bill steppian, and his main man on the port authority, david sampson. and the investigation doesn't address any criminal wrongdoing. federal prosecutors in new jersey are working on that.

kelly? >> so, more to come, scott. thanks very much for now. citigroup was the only one of the five major u.s. banks to have its dividend and stock buyback plan denied by the fed. how much does citi need to regroup after this latest rejection? your tweets coming in fast and furious on this one. furious on . [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪

we've been asking you during today's program, given citigroup's stress test issues, how should the bank regroup, if in fact it should. citi needs better resource management. they're going to shrink down to a town. the question is going to be is this sell-off at 5%, 6%, what bill miller said the last hour, does it change what this bank is going to earn over time? or potentially the valuation, as other macro factors improve? is it an opportunity to get exposure here? >> i think it is. you have to let the dust settle a couple of days. and money is rotating out of financials. we saw the stocks really took a hit. but citi specifically, they're tier one leverage ratio, was 1.6%. the leverage was 4% from the fed. they easily met that.

and i think it's completely right in terms it hasn't changed the underlying fundamentals. and the capital ratios go up because they're not going to be paying out. it does have emerging market exposure. the reason they didn't get approval is because of the mexican issue most recently. and see how that plays out. but i like the restructuring story. >> what about you? you see opportunity here? >> absolutely. we're holders of citi. and for those very reasons. the company will be paying a dividend. it's just delayed. nothing's changed. >> the citigroup fraud in mexico, small on the scale of citi's revenues. but huge when it comes to the scale of fraud. and you have to wonder about controls, basically, throughout the company when something like that happens. >> i totally agree. i think that was one of the reasons -- they wanted to send that message, i think, to citigroup, the feds did. >> guys, thank you so much for your time on the panel today. and for bearing with us, folks

out here in dayton. have a great afternoon. "fast money" coming up in a few moments. mandy on for melissa lee. >> twitter, netflix, pandora, down double-digits this month. what does it mean for the broader market? is there something bigger at stake here? we have lots of questions. hopefully we get answers over the next hour. we're looking forward to it. >> i was going to say, go, flyers. >> "fast money" starts right now. we're live from the nasdaq market site in new york's times square. i'm mandy drurry. sitting in for melissa lee. our traders are pete najarian, karen finerman, and guy adami. and the sell-off in tech is intensifying. the nasdaq on track for its biggest weekly drop since june of 2012. you see it down there. the biggest point declines coming from big names like google, netflix, priceline and amazon. so, as the nasdaq sits