watching. i'm going to try to make it 3:45 flat at laguardia. what are the odds, 2%? >> i'd say negative 2%. >> i'm going to try. got to go, literally. >> he's literally taking off, changing in a phone booth. "closing bell" is next. >> i think i played turner-ashvy in quiz bowl. welcome to the "closing bell," everybody. i'm kelly evans at the new york stock exchange. >> i'm bill griffeth. the fighting in israel continues, the blame game in ukraine over who shot down malaysian flight 17 intensifies, and the dow and s&p have been flirting with all-time highs, although we've come off those highs in the last 15 minutes. the dow was up 81 points, now a 58-point gain. we're trying to figure out what's bringing the market down the last few minutes. and meanwhile, the deluge of earnings continues. after the bell, both apple and microsoft report quarterly results.

we've got an all-star team lined up to get you the numbers, and more importantly, what they mean for stocks in the broader market. stay tuned in about an hour when the action heats up. >> an impact on tomorrow, without a doubt. you know the saying buy the rumor, sell the news? when it comes to bill ackman and his reported takedown of herbalife today, it was more like sell the rumor and buy the news. i mean, big time. his presentation didn't tank the stock, as expected, it did just the opposite. herbalife is surging right now by 18%. why does the market think that he's so wrong about this company? we're going to take a closer look at that. it's an intriguing story. it is. now, let's look at where we stand in the markets. the s&p 500 at 1,982 is currently three points away from trading at an all-time closing high. now, the dow jones industrial average not far behind. it's at 17,110. its high water mark is 17,138 for the close, 17,151 for the intraday high. and finally, the nasdaq doing

reasonably well today, in fact, out-performing the other two, up about 0.6% or 26 points. reacting to big news after hours yesterday on the earnings front there as well. >> exactly. let's talk about all of it in our "closing bell exchange" with monica meta, rob morgan, jeff reeves, sam stovall and rick santelli, of course, from cnbc in chicago. sam stovall, you get the word from my favorite line of the day regarding the market. you say the s&p needs to rest, but not necessarily rest in peace. how are the earnings doing right now, sam? >> actually, the earnings are doing quite well. s&p capital iq consensus numbers now showing a 7% increase for the second quarter versus the 6.6% gain expected at the beginning of the quarter. and if history repeats itself, we could end up seeing that number possibly even approach the 10% level, because the

reality usually beats expectations by anywhere from 2% to 3%. >> rick, i want to go to you on this. yesterday we were talking a little bit about the ten-year, but it's extraordinary to watch that yield go below 2.5%. you have to think maybe that's a tailwind for housing, which, by the way, this morning had a pretty strong report. the market didn't pay attention to that, didn't really pay attention to the recent fed surveys. maybe the cpi's spooked, maybe it's geopolitical. what do you think? where do rates go from here? >> i think all the topics and sectors that you mentioned are kind of painted in to a boundary. so, yes, housing might not necessarily be reacting to the notion that we're just a couple of basis points away in 10s from 13-month-low yields. 30-year bonds are already there. but we were at 5 million existing back at the end of last year. it definitely is more than interest rates. and remember, one-third of all transactions are cash, so take the theory of low interest rates

helping people who can't get credit, since that really isn't a main underpinning now. that's where the headwind is coming in the economy, and all the other issues seem to make sense by looking at the yield curve. >> rick, hang on one second here. we've got some breaking news. herbalife is now responding to bill ackman's latest accusation that the company's a pyramid scheme. scott wapner has that now. >> after bill ackman's two-plus-hour presentation in midtown manhattan, one followed by herbalife's stock now having one of its best days ever certainly in six years. herbalife says in part, "once again, bill ackman has overpromised and underdelivered on his $1 billion bet against our company. after spending $50 million two years and tens of thousands of man hours, bill ackman further demonstrated today that the facts are on our side." they go on to say, among other things, "we recognize that he is running out of time to make good on his bad bet against

herbalife. today is evidence that bill ackman will not succeed." so, these the first comments now from herbalife itself following bill ackman's presentation in midtown manhattan. the most notable news today arguably what's taking place on wall street with herbalife's stock. as you see, shares up more than 19%. it will go down as one of herbalife stock's best days ever, certainly in the last six years. so, these the latest comments now, guys, straight from herbalife following ackman's presentation. >> scott, remind us of the guest you had on earlier today who said he was liquidating other positions so he could get further long herbalife, that he thinks now this company is one of the best poised he's seen in his investing career. >> it was another investor who has long traded in and out of this stock, a gentleman by the name of robert chapman. he has been buying aggressively herbalife. he said yesterday and today as well, he thinks the stock could go to 300 bucks over the next five years, assuming that it remains a public company. of course, there's questions, and there have been speculation

for many months, if not more than a year now, as to whether herbalife would eventually remain a public company for that duration. but it's an interesting story today after bill ackman himself came on cnbc with me yesterday and said this would be the most important presentation he would give in his entire career -- >> and maybe he didn't nineteen quite like this. >> he was probably right. >> he certainly raised the bar on the expectations. and at least wall street seems to be voting today the other way. they do say as well, remember, today's presentation was mostly focused on herbalife's nutrition clubs, in which, in part of the statement they make today, they say the claims made by ackman today are completely false and fabricated. so, we're going to continue to follow this story. herbalife makes its comment. the stock has added tremendous volume in herbalife shares, as you can see on the bottom of your screen, guys, and this may very well go down as herbalife's best day ever as a publicly traded company. >> well, you have to believe that a few shorts have been

taken out today and you wonder how much pain bill ackman's feeling as a result of all that, too. thanks, scott. anybody in our panel want to touch this hot potato? i wouldn't blame you if you don't. >> no way. >> rick, before we stop with you, a little bird on the trading floor pointed out that the euro is at a low today. who should mario draghi send the thank-you note to. >> i don't know that he should. i think the euro is finally catching up with the bad fundamentals of europe. they might celebrate because germany likes it with the economy, but in the end, should the euro get under 1.33, i don't think it will, i don't think that will send a solid message regarding the outlook. >> by the way, to ray dalia out there talking about the contagion risk across europe. monica, digesting earnings, digesting some stock battles, digesting the macro environment, where do you see opportunity in these markets? >> well, i think with earnings, everything looks good in terms

of profits and sales, but i think it comes back to the broader economy. will the economy actually rebound from corporations doing better? and i'm still not convinced that they will. because if you look at the sectors that are performing well, energy, for example, the jobs that are being created in energy don't necessarily come down to the folks that are in the unemployment lines. they're very specialized skills and we see that skill gap. >> wait a minute, i just read about a pizza driver in north dako dakota, lasting for a driver taking $56,000 a year plus benefits. >> and i'm sure there's millions of people who would love to fill that one position -- >> i mean, that's not a very specialized skill, is it? >> well, i think that just the fundamentals -- >> it is in north dakota with all their shortages. >> the fundamentals do show that there are millions of people who are out of work, there's millions of people, i think more than 3.5 million, who are working part-time that want to work full-time. if you've found a great listing, maybe make 3.5 million copies of that and send it out. but i think broadly on the whole, it's a weak job market,

and the performance of the s&p corporations isn't necessarily translating into something that boosts up the economy in jobs and wages. >> rob morgan, i know you're keeping an eye on apple. we've got earnings coming out at the top of the hour. do you like apple at these levels? >> yeah, bill, i certainly would. i like the technology space, and really, more the large-cap growth names like apple and microsoft would be names that i'd be looking at. i think staying away from the social media. now, obviously, janet yellen's group was telling us to do that as well. so, yeah, we'll see how apple comes out today, but i do like that stock. >> jeff reeves, what are you keeping an eye on, which earnings here? and again, still just this morning, a lot of the consumer staples names aren't perform thaeg well, mcdonald's, coke, kimberly-clark. >> chipotle's a different story. >> yeah, true. >> yeah, i think earnings across the board are pretty good, though. i mean, there's a couple stocks here and there where you could say valuations are stretched or

a couple stocks are going to tank on earnings, but broadly, i think the market is doing really well. i think earnings season is going pretty good for us. i would disagree with the notion that the labor mark is weak out there, aside from the 6.1 unemployment rate. i think it's a question of demographics. i think people are leaving the labor force. again, that's another reason i'm long equities. i think the s&p's going to finish the year in the low 2,000s, maybe 2,100, because we have a lot of baby boomers without incentive -- >> a lot of 25-year-olds are retiring. that's exactly right. >> i hope -- [ everyone talking at once ] >> 25-year-olds don't have any money, though. >> yeah, go ahead. >> and that helps the economy? >> if you're just looking -- if 25-year-olds have money? i mean, if the older americans do leave the workforce, the younger americans get jobs, sure, but from an investing perspective, talking about buying pressure from the market -- >> no, you were saying that the unemployment rate shows it's a good labor market and that is completely and patently untrue. >> that's all right. >> the labor participation rate

has been falling because people have been leaving the workforce, in part because of obamacare. >> but it's not only demographics. even janet yellen is finally admitting the structural issues that we have of people, 58 million, to be exact, that have all the parts on their body to work, except for they're not. >> rick, can i ask you a question? there's a disconnect in the labor force between the skills that we talked about earlier in the segment, the skills and the wage. don't you think part of that is because corporations are trying to get people to work for $35,000 a year and people aren't inventiveized to take that job? >> no, it's about education. we spend more on every pupil than any other country and the risk on investment makes it look like chipotle. >> just because american universities cost so much money -- >> and why do they have to take student loans out that they can't pay back? the game spirals out of control because they're taking money because the government is giving it to them -- >> no, we've sold millennials on

the notion that they have to go to college because if you really want to unravel this yarn, it's because community colleges anymore don't give people vocational degrees. >> not true. >> they want them out in two years so they can go to a four-year institution and graduate with $100,000 in debt. i graduated with $100,000 because of that. >> in illinois, they got jobs because they got a good education. >> both sides are clear at this point. we have to go. good discussion. thank the rest of you. rick, i don't think there's any truth to the rumor, jeff reeves is not related to jack bouroudjian. we'll move on from here. thank you for joining us today. >> let's check out the family tree. >> yes, we will. on to another story. obamacare's been in the news today and it remains a mess. >> yeah, we're keeping an eye on hospital stocks. bertha coombs, can you sort this out for us? >> it's one of those situations if you don't like an obamacare ruling, wait a minute. at issue, are obamacare subsidies legal for those who

got them on healthcare.gov? a three-judge panel in the d.c. circuit court of appeals said no. the affordable care act specifically states irs subsidies go to residents in states that set up their own exchanges. the ones in blue here on our map, like california and new york. so, states like texas and almost three dozen others, including florida and pennsylvania that were all part of the federal exchange, if today's panel ruling is upheld, subsidies for 4.7 million americans would go away. but hold on. a virginia court, the full 4th circuit court of appeals ruled that the federal exchange subsidies are legal. that could help the obama administration in its appeal to the full bench in d.c. now, professor ken thorpe says the issue could be resolved in congress, but both sides are wary to do that. >> that's been a real challenge about opening any aspect of the affordable care act back up, because it would open up a whole

range of opportunities for people to make a wide range of changes in the legislations. >> ultimately, it could end up at the supreme court, but insurances rallied off strong earnings from sentine. a lot of folks say this is going to be a long process. meantime, subsidies will remain in place until appeals are done. guys? >> bertha, thank you very much. what a story. heading toward the close, we've got about 45 minutes left in the trading session. the dow hanging on to gains, off the highs of the day. the industrial average was up 81 points, now a 67-point gain. coming up, td ameritrade ceo fred tomczyk talking earnings and if mainstream investors are jumping back into the markets. remember, we're at or near all-time highs here. that's ahead. also around the bend, toys for rich people. polaris explains why the motorcycle maker just raised earnings outlooks for the year

as rival harley-davidson lowered estimates. that's revving up polaris shares big time today. and up next, how much debt is good to have? a financial planner and steve liesman have very different ideas about this and they'll hash it out. ♪ ♪ over 1.2 billion eyeballs are on us during the two weeks at wimbledon. true tennis fans want to know what's happening. they don't want to just see what's happening, they want to know and understand why it's happening. anybody can just put data up, but we want to get a reaction, make it far more interactive. we rely on the cloud to provide that immersive digital capability. give fans more then just the game with the ibm cloud. the ibm cloud is the cloud for business.

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slightly higher market today. the dow's up 68 points right now. the s&p up about 10, about 0.5%. the nasdaq up a little bit more than that. you can see where we are in relation to an all-time high. we're about a point and a half away from that for the s&p, so we're keeping an eye on that. a reminder, we have earnings coming out tonight from apple and microsoft, along with others, electronics we'll be keeping an eye on and could move the market for tomorrow. the so-called credit boom, meanwhile, is said to have helped the economy recover but some warn it could lead to another crisis down the road. >> so, when is getting credit, or more to the point, going into debt, a good thing for you and the economy? one of our next guests says almost never. financial expert chris hogan. and taking the other side of that trade is our senior economist, steve liesman. chris, you don't see the merits of credit in a consumer-based economy. why? other than for a mortgage, we should point out, right?

>> well, i look at it this way, that interest that you have to pay is a penalty, but interest that you earn is a reward. so, i don't want people to penalize themselves. i want them to reward themselves by having a game plan, avoiding debt at all costs. >> is that the right way to look at it, steve? >> i don't think so, because you said penalty and reward. i look at both as a cost, right? the cost of taking on credit now to buy something, that's the price you pay for current consumption versus future consumption. to save money, the opportunity cost of not consuming something. they're both sort of a privilege. i'm not here to argue anybody should take on debt they can't handle. i'm here to say that a person has a right to ask his future self to pay for some of the consumption that they will enjoy based on today's purchase, and that's what debt does is sort of takes the payment and spreads it out over time. it says, if you buy a house, as the simplest example, well,

future steve should pay for some of that consumption rather than current steve paying for all of it. >> you know, chris, you've said that you think a mortgage is pretty much the only debt a household can ever justify. so, in an economy when precisely the opposite's happening, people are taking out loans for their education, for their cars, for all sorts of things, including vacations, but not for a house these days, you think we should completely reverse those activities here and that would make for a better long-term outcome? >> well, i just think people do better when they have cash. and so, if i'm not having my money become -- see, debt makes your income out gone. and it's going to all these other things. so, i think people could have a better quality of life if their income is staying with them and they're able to do things for their family, instead of making the creditors rich. >> kelly, the data show that consumers have really been on a serious deleveraging streak here. now, some of that deleveraging has come from default on debt, others comes from paying down a

debt and others from growth in the economy with less debt. but we're down to levels -- some of my data doesn't go back far enough to find a level low enough when it comes to debt service ratio. some of that as welcomes from low interest rates engineered by the federal reserve, but it is probably fair to say that this economy would be healthier if consumers were more confident and took on somewhat more debt to reflect confidence in the economy, which creates more confidence in the economy -- >> see, i would totally disagree. because see, as i travel the country and i speak, i've met with john and sally. these are people from main street. now, steve, i know you're from wall street. you're an economist. but being from main street, i meet with people that are feeling the crunch, people that have their backs against the wall trying to make ends meet. and so, i want them to get a game plan. the last thing they need is another payment. they need a plan. >> what about for education, chris? because we should differentiate by type here. and it's one thing to use credit

to bring forward a purchase that you otherwise couldn't afford to make. it's another thing to use it to invest in yourself so you're more productive and earn a higher wage longer term. >> well, i think we've all seen what the student loan situation has gotten us. and believe it or not, there are ways people can get higher education without going into hundreds and thousand dollars worth of debt. so, i would encourage people to have a game plan. plug into the community colleges. go there, get your associate's, then transfer to that school. but here's another tip, get a job while you're in school. don't incur debt. it's going to steal from the quality of your life later on. >> is there middle ground to be had between the two of you? >> yes. >> and is that word manageable, in terms of manageable debt? chris, what i hear you saying is don't take on debt that you can't service properly or that is going to sacrifice your lifestyle at the same time. >> well, i would tell you this, the only debt i want people to take on is for a mortgage, and with that, i want them to get a 15-year fixed-rate loan and

attack that bad boy as fast as you can. there is no other debt i want people to have, not credit cards, car loans, nothing. buy it with cash. >> steve. >> i think chris and i both agree that one should be prudent about it and aware of the cost. i think we disagree on the issue of spreading out payments over time and the ability to use debt to bring forward certain consumption, which i think in a limited and prudent way is okay to do, but people being educated -- to my feeling, we've swung all the way to the pendulum that all debt is bad. i don't think that's true. i think some debt's okay. >> good to see you both. thoughtful conversation. thank you very much. thanks, chris, for joining us today. >> a quick market flash. >> kelly, bill, this is a name that a lot of equity traders all want you to be familiar with, itg, which is investment technology group. i remember i used these as a broker back on my time on wall street. the stock is spiking up as philadelphia financial management discloses a 6.3% stake in the company and is calling for a new ceo as well as

a possible sale of the company. you can see there those shares just off session highs, up probably 4.5% in the trade. so, bill, kelly, itg, well-known broker. the deposit system used by a lot of traders on wall street. still they are at least the target of one investor group. back to you guys. >> thank you, dom. breaking news on deutsche bank. mary thompson, what do you have? >> according to dow jones, an examination by the federal reserve bank of new york, according to dow jones, says deutsche bank's u.s. operations suffer from a wide variety of serious problems, including shoddy financial reporting, inadequate auditing and oversight and weak technology systems. all of this, again, coming from a letter that was written by the new york fed. in the letter, according to dow jones, it says that some of the bank's u.s. a.r.m.s are low-quality, inaccurate and unreliable. these are the financial reports produced by the u.s. arm of deutsche bank, of course, one of the world's largest banks and a germa german-based bank. the letter says deutsche bank

has made no progress at fixing previously identified problems. and then the report goes on to say that the letter, which hadn't been previously reported, ordered senior deutsche bank executives to insure steps were taken to fix the problems. it also said, this being the letter, that the bank might have to restate some of its financial data that it had submitted to regulators. the report quotes a deutsch spokesman saying the bank is working diligently to further strengthen systems, but it is affecting the stock right there, as you can see. back to you. >> mary, not that you would know this off hand, but why do you think it's the case? or wouldn't somewhere in its financials -- since december, deutsch had said something oblique about a reference to this letter. why is this the first we're hearing of it? >> i'm not sure that they would have said something like this, unless there was some kind of civil action. usually, banks are pretty quiet about what their conversations are with their regulators. >> yeah. interesting. thank you very much for bringing that to us. >> thank you, mary. >> deutsche bank shares lower on that. with 35 minutes left in the

session, watching financials generally here. dow sub 66 and the s&p just shy of its closing high here. hot earnings, hot stock, polaris industries surging after they raised earnings estimates for the rest of this year. >> and the company's ceo's going to speak with us exclusively right after the break. we're going to get his take on the economy, the weather and what people are buying. >> and where he went to high school, too, by the way. financial noise financial noise financial noise appreciate our powerful, easy-to-use platform.o no,thank you.

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welcome back. a spate of economic data today. we haven't even gotten to the better-than-expected housing report, some stronger regional economic reports, a soft cpi, and on the back of that, interest rates are lower today and markets are slightly higher. there's a look across all the major indexes and the dow transports, by the way, which is up 1%. >> all-time high. >> speaking of the transports, by the way, polaris makes motorcycles and lots of so-called toys for the wealthy. >> today it's trading up after beating street estimates on its earnings report, trading up 9.66%. for a cnbc exclusive, we welcome ceo scott wine. scott, welcome back. >> thanks, bill. >> you raised estimates for the year. give us a sense for how that quarter went. >> we had a phenomenal quarter really across the board. teams executing at an extremely high level. our off-road vehicles are expanding our lead as number one in the powersports industry. we had a great quarter in

motorcycles. indi indian's been well received and we offseted a tough situation with the canadian dollar. across the board, one of our best with retail sales in north america up 15%. one of our best quarters in almost a couple of years. >> scott, you may be the lone ceo who could cite weather as a positive for the quarter. how sustainable do you think this out-performance is for the next couple quarters? by the way, you'll be facing tough comps next summer, if the weather isn't quite as bad. >> no, well, you know, we face seasonality and weather comps all the time, and the difficulty we had in the first quarter, you know, with weather, we saw that really dissipate a little bit in the second quarter and the motorcycle environment got better. and we saw sequential improvement throughout the first half of the year and we expect that to continue. we've got our annual dealer show coming up to celebrate our 60th anniversary next week, and we have just a plethora of wonderful products to introduce, and we expect momentum to

continue into the second half. >> so, are you saying net-net that you think weather actually hurt your performance instead of helped it? because i know that even though we talk about you as a motorcycle company, that's something like less than 10% of your business, right? a lot of it is snow bikes and snow machines -- >> well, our products -- yeah, motorcycles and snowmobiles together are still only about 15% of sales. our largest business where we're a strong number one is off-road vehicles with our sportsman atvs, our ranger and raiser side-by-sides. weather was difficult for everybody in the industry i think in the first quarter, but as the second quarter came around, we did not see a negative impact from weather, and quite frankly, we don't like to use anything as an excuse. we have to work through lots of issues all the time and weather's always going to be one of the variables we have to deal with. >> as you point out, harley-davidson was still citing weather. inevitably, there are going to be comparisons between you and harley. tell me, i often think of harley-davidson as for the older demographic, and you're for a younger demographic. am i wrong about that? >> well, we certainly have a

much younger buyer in many of our product categories. certainly, i think indian buyers in general are probably closer to the harley age, but you know, across the board, our victory motorcycles, and really some of the indian bikes that we bring out are at a price point and a styling that really attract a different and younger demographic. >> scott, before we let you go, can i just ask, in light of the move across the industry, would you guys do electric vehicles, make that a big part of your business, especially on the bike side going forward? >> well, i don't know that we're going to make a bet that it's going to be a big part of our business, kelly, but we do have an investment in a company called bramo, which has arguably the best power trains for our size of vehicles, and we certainly think that that lithium ion power train is going to be a part of our power train solutions in the years ahead. >> wow. >> scott, good to see you. thank you. continued success. >> thank you very much. have a great day. >> scott wine of -- yep, you, too. look at this, more breaking news, this time on the hedge fund front.

kate kelly with that story. what do you have, kate? >> thanks so much, bill. another lawsuit seeking to defend a hedge fund's rights as a bond holder has just been filed. in this case, it's blue mountain capital. the $21 billion asset manager in new york seeking to defend itself as a creditor of the puerto rican electric authority. the puerto rican electric utility, which has been struggling of late to meet debt payments. and blue mountain believes that a recently passed law in puerto rico that gives certain companies wider latitude to renegotiate debts is essentially going to allow companies like the utility to perhaps avoid their constitutional obligations as an issuer of public debt, among other things. they have hired ted olson to represent them in court. they filed in u.s. district court in puerto rico, kelly and bill. and it's sure to be another interesting case as we watch elliott in argentina unfold, fannie and freddie litigation unfold, et cetera. >> the whole industry watching it carefully, kate. thank you very much for that update. with 30 minutes to go here. >> yes, indeed.

30 minutes left and we're starting to gravitate higher again. the dow up 74 points. the high of the day was about an 81-point gain, so we're getting back there. we're watching the s&p, though, as it moves ever closer to an all-time high. we're less than a point away now with a gain of almost 11 points right now. >> much more ahead on these markets. td ameritrade ceo fred tomczyk speaking with us on their brokerage earnings and find out if the retail investors is getting back in the game as the market continues with new highs. >> and stand by. two of the biggest names in technology, apple and microsoft posting results after the close tonight. we'll get you the numbers, the analysis and the important market response and the guidance as well, coming up here on the "closing bell." stay tuned.

welcome back. plus signs today for the major averages. you see the dow up 71 points. that's the one everyone keeps an eye on, but the traders watch an s&p, close to an all-time high. 1,975 is considered resistance to a lot of traders and we are just a bit away from an all-time high on the index, as you can

see. >> july 3rd, after the strong payrolls report. meantime, trying to get back to that level. td ameritrade moving a leg lower today. earnings roughly in line with expectations, revenue beat, but the firm says it's not as confident as how active the retail investor will be, and that's weighing on shares. >> more with fred tomczyk, ceo of ameritrade, sitting with us at the new york stock exchange. welcome back. >> great to be here. >> that was a quarter of low volatility and low volume. is that what you were looking at? and do you expect that to continue? is that what's happening here? >> 401,000 trades is a pretty good quarter. we have what we call an activity rate, which was 6.5%, which is pretty much on the average of the last three or four years, but i think we're coming off a quarter where we had record trades close to 500,000, so people have definitely seen them come down close to 100,000 trades per quarter. so, i think that's what people are seeing. there's no question, we had 62

straight days of where the s&p 500 didn't move a percent. that's the longest period of time at that kind of volatility since 1995. so, it was pretty low volatility. >> what do you think happens for the next couple of quarters here? >> you know, i don't know what's going to happen in the next four quarters. retail investors are still engaged. they're still engaged, still logging in every day. so, they're still watching things. but there's just no volatility. and you know, when you look at it today, if you would have told me a year ago that, basically, we would have had what's going on in ukraine, in the middle east, and we'd have no volatility, i wouldn't have believed it, but i do believe volatility will pick up as the fed starts to pull it back a bit. >> they're logging in, they're watching, but are they investing? are they part of this market right now? >> they are definitely part of the market. so, our investor movement index continues to show the people that are investing are very bullish. so, they're bullish. they've been invested all the way through this. they've done well.

but without volatility, they're not going to trade much. >> does that mean we've become a nation of warren buffets? everybody's just buy and hold? this might be a headwind for you guys as a business, but for the investing public, do you see worrisome trends or -- >> we've been shifting to be much more of an asset-gatherer, so you should expect it to shift and see more long-term investors. we've been making that move. but the active trader part of our customer base, which basically will dominate our trading volumes, they need volatility, and we look for the volatility. and we're just not seeing that right now. >> yesterday we were commemorating the fourth anniversary of dodd/frank, the financial regulation bill that's still making its way through into the industry. and we had both senator dodd and congressman frank on the show, and i asked him, if you had to do it over again, what would you do different? and both of them right away said we would change the regulatory structure of the industry. we wouldn't have what chris dodd called this alphabet soup of

regulation. there are too many regulators out there. do you agree? >> oh, i absolutely agree. when you look at -- if you're somebody like in our shoes, we're just a broker dealer, but dealing in the futures market, the foreign exchange market, the options market, the equities market, fixed income market -- >> everybody's got a regulator. >> everybody's got a separate regulator, and the markets are getting more and more connected. and you see trends that may start in the futures market move into the equities markets or vice versa. so, they're definitely connected. i do believe having one structure would make life a whole lot simpler for everybody. >> did your second quarter get hit at all, from what we could call the michael lewis effect? in other words, all this discussion about market structure, and as you made more money from pay for order flow and the public's learning more and regulators are looking more closely at the transparency here between how you guys make business and where you send your

orders, do you expect, do you have confidence that that level of income will be at or above the second-quarter level going forward? >> revenue-sharing, as we prefer to call it, payment for order flow, that's going to be highly dependent on volumes and trade mix. and you know, it did go down quarter over quarter, because trades are down. but you know, that mechanism's been around for a long time. i think it's been looked at many times and it's still around and seen as a better way than other ways in the market. and it did change a lot of what we used to do, you know, 10, 15 years ago. we will do some things to increase that transparency. we don't think it's affecting our business at all. just to give you an example, since we had the last hearing in washington and this kind of stirred up again, we've had 19 phone calls on this subject from our clients. we keep saying this is a wall street issue. it's a battle between wall street participants. it's not a main street issue at all. >> so, it hasn't affected -- >> no. >> you don't think it's affected

your individual customers out there? >> no. >> all right. good to see you, fred. >> nice to see you. >> fred tomczyk, ceo td ameritrade, joining us at post 9 of the new york stock exchange. >> the dow almost at session highs, again, shaking off news from around the world as we continue to get it. watch the air space closures as well. and we'll all be talking about apple and microsoft. the results will be out at the top of the hour. jon fortt tells us the numbers to watch out for next. and of course, we'll bring you those earnings the instant that they hit the tape and bring them down with our full team of analysts and shareholders. so, don't touch that remote. we'll be right back. but i've managed. ♪ i got to be pretty good at managing my symptoms, except that managing my symptoms was all i was doing. ♪ when i finally told my doctor, he said my crohn's was not under control. ♪ he said humira is for adults like me who have tried other medications but still experience the symptoms

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offers end july 31st. share your summer moments in your mercedes-benz with us. welcome back. it's turnaround tuesday, and not just for shares of herbalife. as markets are rallying here, the dow to the tune of about 69 points. 17,120. the record close high for that index is 17,138, so we're not far off. of course, as we said earlier as well, not far off for the s&p, only about two points away. the nasdaq the out-performer, up 0.7% or almost 30 points today. >> well, we could get movement after the close, because apple and microsoft will be posting their results at the top of the hour. pencils and papers are poised. jon fortt, give us the numbers.

>> reporter: bill, apple first. wall street's looking for around revenue of $38 billion. the high end of apple's range. eps of $1.23. that translates into around 35, maybe 36 million iphones would make the street happy. on microsoft, revenue $23 billion, eps maybe 60 cents, but the analysts didn't factor in nokia, the acquisition along with that. so, the estimates aren't really clear. it could be 60, 63 cents, depending whether you're including it or not. nokia's going to bring down that eps number. and devices and consumer and commercial will factor in there as well, looking for a commercial revenue number of around $13.2 billion in that mix. we'll see how it shakes out, bill. >> all right, good stuff. thank you, jon. keep it right here for all of the apple and microsoft action after the bell with 13 minutes to go. we're going to hear from those companies right after the close. meantime, when we come back, home sales hit their fastest pace since last october, but how long can that upswing last?

real estate developer don peebles will weigh in when we come back.

ten minutes left in the trading session with the dow up

about 68 points. the one we're watching really is the s&p, very close to an all-time high. we may not get there, but you never know. 1,985 and change is what we're looking for. transports, that is an all-time high. >> and it's going to be a squeaker for the s&p. along with stocks, home sales rose again today. >> up 2.6% for the month of june. that was an eight-month high. but sales themselves overall had been slowing since they peaked in the summer of last year. >> joining us now for the bigger picture on real estate and the economy is don peebles, chairman and ceo of the peebles corporation. don, it's great to have you back. maybe you can help us sort through the myriad reports out there about the economy that seem conflicting. what is your read on housing, how strong it is, and how sustainable this recent uptick is? >> well, i think the housing market's very strong right now, and it will continue to gain momentum. and i divide the markets up into a couple of different segments. we have the global gateway

cities like a washington, d.c., miami, new york city, san francisco, los angeles. those markets, they are so supply-constrained that they're getting tremendous pressure on pricing. and so, while volume is slowing down a bit, it's only because there's a lack of inventory. and then the better ashry markets, boston, massachusetts, those markets are having continual, strong appreciation. and i expect those levels of appreciation to start getting larger. and i think that we're going to see a lot of activity over the next couple years. >> okay, what about the demographic play, though? what we hear anecdotally and what seems to show up most often in the first-time home buyer segment is they are struggling at this point. they are the ones that are not being able to afford that new home, and we have a very strong rental market as a result. how long do you see that continuing? >> well, two-fold. one, i think that it's job-driven, of course. the economy's still producing at

a slower pace in terms of job generation than we'd like to see. but also, there's an inventory question. the challenge is that those people who are in the starter shoemz right now, there's not a lot of affordable or new inventory for them to move up. but as the market continues to recover, more homeowners will put their homes on the market as they find new places to move into. and i think it's those two things that need to happen for the first-time home buyers to get into the marketplace. and then, of course, they've got the big risk factors where interest rate's going for those buyers. >> i want to go back to the first thing you said, which is that the housing market is very strong. i think that's an out-of-consensus view. are we on wall street missing the real story out there? >> the statistics in the gateway markets, the statistics are not all accurate, because what's happened is there is a tremendous amount of presell activity going on, say in south florida or miami, ft. lauderdale, new york city. all these new projects that are getting developed, especially in

the condominium side. those units haven't gone to closing yet, and that's where a lot of the activity is taking place right now. so, as they come on market, which will be next year and the year after, you're going to see some amazing price increases and a lot more in terms of activity that's just right now, you know, hidden from the marketplace. >> but what happens when, inevitably, quickly if we can, don, what happens inevitably when rates go up because the fed is taking the punch bowl away? won't that slow things down eve more in the housing market? >> it could, but i think that also rental rates are going up so much now, we're at a time in the country where it's now cheaper to buy in many of the markets than it is to rent. and i think that will be a bit of an insulation for that. >> don peebles, thanks for being with us. we've got the closing countdown coming up in a moment. yes, we do. and after the bell, "closing bell" will be earnings central. apple and microsoft post results. we'll talk through the numbers,

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start to pull back a little bit. let's keep an eye on earnings, set to come out tonight. in a few minutes, we'll be hearing from microsoft. they're expecting a profit of 60 cents on $23 billion in revenue. apple, they're looking for $1.23 on $37.9 billion in revenue. and electronic arts, they're looking for a profit of 4 cents -- no, excuse me, a loss of 4 cents on revenue of $713 million. bob pisani. >> and we notice that old-school tech, like microsoft, like intel, like cisco have been doing great this year. so, the important thing today is we saw -- i know it was a little sideways most of the day, but we saw big groups in materials move to the up side, we saw iron ore stocks, aluminum stocks, steel stocks moving up, the dbb, which is the etf -- that's dbb for base metals is at a new high for the year.

we saw other groups moving up. emerging markets, eem, that's the etf, that's at a 52-week high right now. we saw all those groups slowly moving up. the important thing about this market is sometimes it moves sideways so much that you can get kind of a little dozy if you don't pay attention. stuff breaks out and you don't notice it. >> as fred tomczyk pointed out, 62 consecutive days for the s&p not to move 1% one way or another, which hasn't happened since the mid-1990s. >> but my point is don't let your eyes glaze over. >> absolutely. >> things move in between, so watch the metal stocks, watch emerging markets, which had a big plunge in march and april and now has come back all of the way. >> and the stock of the day i think had to be herbalife. bill ackman took his biggest swing at it and it went up today, biggest day ever, maybe. >> they will study this in business schedule as a study in hubris, meaning pride. be careful about overclaiming. make modest claims and then

overdeliver, not the other way around. >> and we'll be looking at that coming up in this next hour. a fascinating story. bill ackman versus herbalife. stand by meantime for those very important earnings reports from microsoft, apple and electronic arts. it's the second hour of the "closing bell" with kelly evans. i'll see you tomorrow. welcome to the "closing bell," everybody. thank you, bill. i'm kelly evans and here's how we're finishing up the winning day across wall street, but it doesn't look like the s&p 500 there was going to close at a record high. it's at 1,983. the highwater mark 1,985 from that jobs report released on july 3 that was stronger than expected. markets have been trying to get back to those levels. today a little bit of a turnaround tuesday as the dow adds 60, closing to talmost the all-time high. nasdaq up 0.7%. we're waiting for a couple key

tech bellwethers to report, microsoft and apple. before we get to them, let's get straight to the "closing bell panel." jerry bernstein, our own sharon epper stone, shark tank investor kevin o'leary, and "fast money" trader bryan keian kelly. before we get to the companies due to report any moment now, brian kelly, can we talk about what's going on in the commodity space right now, why all of a sudden, all of these different saw-offs are getting wiped out? >> yeah, it's interesting because there's a lot of cross currents, right? bob just talked about some of the base metals are doing really well, but when you look at the week and oil and gasoline over the last month, they've come in. you're seeing companies, bigger banks getting out of this business. but what's interesting, the guys who sold at the top, like a glen corps, they're in there buying these businesses now. so, it wouldn't surprise me that this kind of rotation or this is a trough in the commodity space. >> sharon -- [ everyone talking at once ] >> yes, well, it's money.

it's money changing or not changing and not so much the fundamentals, and that has been the case so much for the commodities market, and particularly for the energy market for a long time, but now we really see that it is the trading community much more so than what we're seeing on the geopolitical front or what we're seeing perhaps even in terms of the fundamentals, in terms of supply that are weighing on the oil market at this time. >> because jared, you could easily envision a scenario where with the news flow we've had, that $104 would instead be up at $120. >> exactly. >> getting back to fundamentals, if you look at this morning's consumer price index, not too strong. if you look at real earnings year over year, flat. so, i'd be interested in trying to kind of map the flat earnings story on to the commodities story. i think there should be some kind of weakness there based on generally weak earnings of much in the labor force. >> and that's where it shakes out, kevin. back to that ten-year interest rate, below 2.5%. maybe it's a little bit of europe, maybe a little flight to safety and maybe a little bit that the inflation monster that people have were starting to see out there is quietly receding a

bit for the time being. >> i'm coming to a new conclusion. i believe that the fed is actually getting behind in a wrong way that really true, full employment is going to be north of 5%. if that's the case, one day we're going to wake up, the fed's going to say, yikes, there's labor cost inflation, we're in trouble, and we're going to ramp this sucker up at a pace that will catch long bond and duration investors offside. watch it coming. >> hold that thought. we have a mover here. electronic arts out with quarterly results and julia boorstin has the numbers. looks like a beat, julia. >> a beat on both the top and bottom line. the company reporting earnings per share, excluding items of 19 cents. wall street had been looking for a 4-cent loss, and that is up from a 40-cent loss in the year-ago period, so big beat there. and revenue coming in higher than expected at $775 million compared to $713 million estimated. they also confirmed its guidance

and talked about strength in mobile and digital revenue from services that it sold in addition to those core console games. back over to you. >> okay, julia. thank you. any thoughts here, guys, on -- are you big gamers? >> not a big gamer. i was going to make a comment about i thought kevin's fed point was really interesting. look, i'm dovish on inflation, i'm dovish on full employment. i think there's a lot of slack in the labor market. but productivity's been kind of weak, and that actually supports your story that higher labor costs in weak productivity climate means higher unit costs, so that could create inflationary pressures. i don't see it, but it could be happening. >> there's such a shared economy, things like air b&b and all the stuff that occurs online that really isn't watched by the fed in terms of what real employment is. there's people like my daughter making money off her apartment in new york. she's not in any labor track, she's in school, yet, she is pulling in money -- >> the shadow labor force? >> i'll tell you, it matters. >> how much is she making?

>> you know, she's making enough not to have a second job, because i make her have a first one. so, the point is, she's not around. this labor that is occurring quietly and in the shadow actually is a form and a statistic that the government's not measuring. >> yeah, but kevin, then how come prices aren't going up, if that's happening? >> i'm telling you, it's going to happen at the labor front. nobody cares right now unless labor and wages start to inflate. >> right, but if it's already happening, that should be affecting the economy. >> you don't want to be long here. >> listen, if that's already happening, that should be reflected in the economy -- >> hang on, i have to break in. >> i'm getting nervous. you should -- >> kevin, i want to know exactly how you're positioning the funds, but hang on for one second because we have microsoft hitting the tape. jon fortt is with us. question mark? jon fortt, what can you tell us? >> i can tell you this, microsoft revenues are $23.38 billion. that's just about in line, a little bit higher. when it comes to eps it gets a

little bit tricky, because a lot of analysts did not factor in the nokia acquisition, which actually exerts a negative 8 cents impacts on eps. so, from a non-gaap perspective, microsoft turned in 52 cents. that includes nokia, because that's now a part of microsoft. so, if you were to back that out, it would be 60 cents. that's probably close to in line with what analysts were looking for, but some included nokia, some didn't. really hard to get a read on that overall. but you've got to also consider microsoft is going to talk on the call about its guidance and also to what extent the cuts that they have already announced will impact going forward. what they said and what continues to be the case from what i hear from within microsoft, is that 13,000 of the employees, the total 18,000 that will be cut, will be cut in the quarter that we're currently in. that's not the quarter that they reported, but the quarter we're currently in that they will report.

so, all of that has got to factor into wall street's thinking about how they digest these numbers and hear the impact of nokia going forward. again, microsoft's cfo as well will detail that on the call, kelly. >> jon, thank you. and stay with us. because the eps number moves around a bit on those components, let's look at the revenue number. the estimate was for $23 billion. it looks like they did about $23.38 billion for the quarter. shares are slightly positive. are we going bring in these analysts? let's do it. max wolf is with us from the milano graduate school and max gerber from gerba kawasaki to talk microsoft here. max, your thoughts? >> i think the revenue number is impressive. we thought it would probably miss, but there's an adjusted miss on the whisper number, and the whisper expectation was more in the 64 handle range on eps. and so, i think it reminds us both of the potential of this company as well as some headwinds, especially as we go into a call here, which will determine the real outlooks, getting the granular and getting

an idea of what microsoft thinks is in store in the next quarter. it's really the beginning of 2015, their fiscal year, that's going to get us most interested. strong revenue, weak earnings. >> ross, do you guys like microsoft? do you own microsoft and what do you think of the quarter? >> we own a little bit of microsoft because we bought it a little bit ago and it was a cheaper stock, but now that it's moved up, i think the quarter's boring. i don't see anything about the quarter that's exciting. and backing out nokia is basically like, they bought nokia for whatever reason. they just fired everybody and now are losing money because of it. microsoft needs to detail what their strategy is. morale is down. they are firing a ton of people. the way he did it was very harsh. and you know, nadella has to tell us, where is microsoft going? what's the future growth for this country? and that's what we're looking for in microsoft. other than that, there's nothing new or exciting to talk about there. >> sharon? >> it looks like that in the stock price. if you look at how stocks are moving it looks like investors

are waiting to get answers to questions on this conference call. >> and to the point of what the focus is. hang on one second. so people know, pretty much the focus of the quote from nadella, "i'm proud that our move to the cloud is paying off. our commercial rate increased." brian, i know you just moved out of microsoft. does anything about this quarter, about their cloud efforts change your mind? >> not now. all this news we're seeing now really was out last week. i sold it on that big spike up when they announced the job cuts, and i think that's the news. now, as we go into the conference call, perhaps they talk about some kind of a pc upgrade cycle. perhaps they give some positive guidance. then that might have me take another look at it, but right now, it's last week's story. >> kelly? >> yeah, well, that's interesting. look, we're also going to be talking about a mobile world, jon fortt. are those criticisms you heard from ross there accurate, you think? >> not quite. one thing i would point out. the commercial business

out-performed 13.48 billion in commercial revenue. the street was probably expecting in the area of $13.3 billion, so a bit lower. that's significant considering a server and commercial cloud out-performed. we had seen some enterprise strength from intel. but look, everybody expected that satya nadella was going to cut staff at nokia. rumor is he wasn't in favor of that acquisition, he went in, cut half and now will simplify the structure as far as management goes. nothing i'm hearing indicates that morale is down at microsoft. on the contrary, there's a sense of a new energy there and bold action right off the top, though he doesn't have the same kind of aggressive tone that some of his predecessors, both of his predecessors might have. so, i think it is really important to listen to the call. i suspect he'll give more detail on the strategy. we'll get some specific numbers on the nokia impact and what to expect going forward as far as the cuts and how to factor in an eps going forward, which is

really muddy right now. >> waiting to hear from apple. don't forget apple and ibm are partnering in apps. what do you think? >> as an investor, with microsoft, this is where money went to die for a decade as it sat around, $33. no disappointment about it. this new sheriff in time is bringing something i like. he's focused on the bottom line, focused on cash flow. he's basically telling us he doesn't care anymore, he wants to change the direction, whether you like it or not, and i like a guy like that and i've been awarded with $10 since he's owned the company as a reward. >> this thing's not the most exciting name on the street by a long shot, in the sector by a long shot. when it meets expectations, it's probably pretty happy, given that sort of lack of sizzle. >> ross, last word to you. >> i think kevin's right. i really think they need to shake this culture up, but you could shake up the culture of the "titanic" all you want, it still went down. and i think the issue is they

need to do something bold. i think it should be in the video game business. ea just reported a great quarter. they would make a great merger there. and i think that either yahoo! or something they need to do to get their business growing in much, much better areas of the stock market to be in than microsoft right now. >> what say you, jon fortt to that? >> i think there's a history of counting companies out too soon. apple was, again, a mess before steve jobs came back. there was a number of things that needed to be sorted out. yes, he did change the culture. he changed a number of other things, too. microsoft's not nearly in that kind of shape. >> all right. >> again, look at this commercial business. it's nearly twice the size of the devices business. it is growing in double digits on multiple line items. so, i think if you're going to give intel the benefit of the doubt, and there's debate on whether you should or not, you certainly have to give microsoft the benefit of the doubt, considering the results they're putting up right now. >> and sharon's point, investors still trying to make heads and tails of it, it seems, as the

share's moving around between positive and negative territory this hour. we'll look for more detail on the call. thank you, everyone. brian kelly and the "fast money" crew at 5:00 will be going through the latest from apple and microsoft's earnings conference calls, as mentioned. we want to hear what tim cook and satya nadella have to say about this quarter. all eyes on apple as they get set to release the latest earnings. the number's due any moment. we'll watch for iphone and ipad sales, see if they can drive the stock to new highs. we've got analysis and reaction the second apple hits the tape when we come back. and bill ackman making his case for why he thinks herbalife as a company is a fraud. promising his presentation would lead to a collapse of the nutritional supplement firm, it didn't quite work out that way. bill ackman's bad day is next.

welcome back. yesterday, activist investor bill ackman threw down the gauntlet on one of his favorite targets, herbalife, saying a presentation he would make today would expose the company once and for all as a sham. >> you're going to learn why herbalife is going to collapse, and that's a pretty strong

statement, but this is the largest fraud, public fraud, in terms of scale of countries involved, harm to people. >> so, this, however, was the reaction on the street to that presentation. herbalife shares, that is not a misprint, up 25% today. more reaction now with cnbc contributor herb greenberg. sorry, herb, i keep doing that. who fronted the critically acclaimed documentary "beyond herbalife: spilling the american dream." he joins us now along with our panel. herb, 25%? >> well, that is the stock speaking for today, and i know it's a big gain, but i always look at people and say, remember, there's the stock and then there's really what's going on and the noise of the stock will drown out. forget what ackman's saying right now, it's the broader question of what's really going on. the stock's telling you that there was great anticipointment,

if you will. he set the stage for something big. if you know the story the way i do, he had some really good information there, but it wasn't the gotcha, hammer you over the head kind of thing with the internal documents that would prove beyond a shadow of a doubt that this is a pyramid scheme. so, what you've done is you now are back to he said-she said. the company's out with its comment, which doesn't really deny what he says. it's a classic pr spin on what he said, saying that he's not right. so i think that's really what's going on. >> kevin, i think this is totally bizarre, this whole thing. i don't know why he would put out the statement yesterday and then the presentation which really didn't have a gotcha at all. >> this is unprecedented to me after watching the market for years that a claimed short position gets national platform to discuss the case and ends up 25% more offside. so, somebody's right. i don't know who's right. i'm starting to look at this thing, saying this is really,

full disclosure from both sides and it's not working for ackman. if i remember, he was short at $40-something. this guy is way off side now, ad this must be very, very painful for him. and i think you either are right or you're wrong when you're short. the trouble is, it's an if anytime perpetual loss -- >> "i will take this to the end of the earth." herb, as you know, he spent $50 million investigating it already, going back to december 2012. >> let me ask you something, because kevin, this is a great question for you. you have been on the other side of short sellers in the past. you've fought this battle. you've been, you know, i chased you for two years on a company at one point, you know. the point is, what is it like to be on the other side, and what do you think? if you're herbalife right now, what are they thinking, really thinking, especially in the face of what he likely presented? >> there's a perverse alternate world being created here with all the press this company is getting. and to a certain extent, it's actually getting more interest from investors, as evidence by

what happened. they keep saying the same thing over and over and over again, as they have for the last year and a half, as the onslaught from this intelligent long investor keeps going after them on the short side. it's not working. i'm enjoying this. this is the best entertainment in the stock market you can buy right now. >> when you go to assassinate the king, you're not supposed to miss. when you do, the king tends to get a little bit stronger? seems to me that's what we're seeing here. >> herbalife's the king? >> it is the king in a number of 401(k) plans, actually. a lot of investors watching this, constantly saying i don't own it, i don't know much about it, but you have it, because it's in microsoft's 401(k). it's in a number of fortune 500 companies' 401(k) plans as a top stock. so, institutional investors are still, whether fidelity or other firms, are still buying this stock. and when you see it up 25%, perhaps they'll be buying more of it. >> let me ask you a question. what you are so good at, when you look at companies, is going back to the cash flow. you can't lie about cash. >> well --

>> and, wait a second. either you're getting cash flow and you're adding debt, you know the end game's going to blow up. ackman doesn't have that smoking gun on the cash flow on this deal. this company keeps delivering. >> well, in this case, when you talk about the cash flow, the company delivers, but the question he's raising, is it delivering that cash flow based on a model that is based on something that is illegal? >> right, right. >> so you know, there's an old -- let me tell you a story. there was a company, american capital strategies. it was a big, short, bull-bear fight a number of years ago. and the ceo came out and started talking about, his motto was short and distort. then he paid a big dividend. he used to say you can't restate a dividend. guess what, he's right. you can't restate a dividend, but when his company blew up, the dividend was eliminated. so, you know, when you look at this, you have to look at everything involved, not just one day's stock performance, which, honestly, is intriguing, and i do think he set people up. he set himself up for a big disappointment. >> got to leave it there. bill ackman's bad day getting a little worse. turns out he may have misspoken

during his presentation. thank you, herb, for now. scott wapner joins us. scott, what did he allegedly get wrong? >> among the many assertions that bill ackman made today was one about a former research analyst named tim ramie, who left d.a. davidson some six months ago to take a job with bill steerts at post foods. mr. ackman today saying that mr. ramey may have been fired from his research position. ramey heard that, of course, and released a series of e-mails to me, which he says prove otherwise. and then ackman told me, when i reached out to him about this, "i received an e-mail from tim ramey complaining about a statement i made in the presentation that suggested that he may have been fired by d.a. davidson. tim has told me he was not fired. please make sure to correct the record." you may recall, kelly, tim ramey, a longtime bull in herbalife, considered the most bullish guy on the street at one point before he left to take another position. >> scott, quickly for people --

all right, we've got to go, but we'll try to follow up with this as soon as we can. thank you, scott. >> okay. >> this is because, guys, we have more breaking news. phil lebeau joins us now. this one, another major auto recall, phil. perhaps per training to -- well, why don't you just tell us? >> it's another one pertaining to ignition switches. this time it is from chrysler. chrysler is recalling an estimated 792,000 older suvs. we're talking about 2000 and 2006 and 2007 jeep commanders, 2005-2007 jeep grand cherokees. what is the recall involved? they are investigating whether or not the ignition switch, if bumped by the driver's knee, will move out of the on position, therefore cutting off the electronics, ultimately, the power steering as well as the airbag. similar to the general motors recall. we should point out, they know of no related injuries and only a single reported accident. but again, chrysler recalling

792,000 vehicles to investigate whether or not they have a faulty ignition switch. kelly, back to you. >> okay, phil. thanks very much. microsoft just one of the big earnings movers after the bell. up next, dom chu's going to round up the action for us, and then it's on to the big one, apple. we're going to have full coverage of those results coming up. being a keen observer of the world has gotten you far, but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea powered by active trader pro. another way fidelity gives you a more powerful investing experience. call our specialists today to get up and running. in a we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant, we help forward-looking companies run better

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as we await apple's results. >> let's look at what's happening first of all with microsoft, get you back up to speed with what's happening here. you can see with microsoft shares, we did see a little bit of an earnings miss heerks but sales did come in a little bit better than expectations. you can see with microsoft shares, they're up about 0.5% in the after market. then you look at electronic arts, really soaring here in the after-market session, up about 1.5%. we'll call it just after its after-market highs. but again, you can see with those particular results, they handily beat expectations on profits and they come in with better sales as well. so, those two stocks showing a bit of action in the after market. we'll, of course, be covering every single one of these stocks going into their particular earnings reports, but up until now, we've seen some pretty, pretty marked results coming out of these two companies, guys. back over to you. >> dom, thanks very much. now, of course, we're waiting on apple's results. they were about to hit about half past. our own jon fortt is standing by. also brian blair from rosenblatt securities along with a panel

here. brian, there are a lot of numbers to watch for, the earnings figure, the revenue figure, iphones, ipads. what to you is the first number you're going to look for when this hits? >> i'm going to watch the iphone number, because that's actually what surprised last quarter when they reported and i think what has the most opportunity to see up side this quarter. i think analysts have been conservative with what they're expecting, around 34, 35 million units, and that's where we could see some upside and that's what will drive any upside to the top line. >> what's your estimate? i'm looking at a number of 36, just an average. what do you guys have modeled in? >> i think it will be better. i think it's likely to be closer to 38, 39 million units for the iphone. >> prior to this report, what's your view? >> so, we look at this stock in increments of 15 right now. used to be increments of 100. so, right now i think it's actually likely to trade off a little bit after they report, because it's run quite a bit. we could see conservative guidance, but i think this could be $115 stock into their earnings, into rather their product event in september. and i think that it will be a

question of what we see then that would determine i think price targets from there. >> kevin, what's your view on apple? >> i own apple. i don't think you own it for what this quarter's about. >> right. >> i think this is the transition quarter between the legacy of jobs and now firmly control of a new ceo with a new vision. i am buying into the upgrade cycle, emerging markets, dividend increases, stock buybacks, all the stuff that i love to hear about. i think that's what i'm going to be getting. >> i would add enterprise to that. they made an announcement with ibm and this partnership will actually be very meaningful for apple over the next few years. we're seeing iphones and ipads in these fortune 500 companies, but now they'll be brought in the front door with ibm as a partner and that's a growth opportunity for apple. >> between the july report, i think the stock's gone up 18% on average. any reason to expect anything more? >> do you own shares of apple? >> maybe a few. >> there's always a big run-up after they give guidance for the

june quarter. until their product announcements in the fall. there's always a lot of anticipation and we're going to see the exact same thing this year because apple's introducing a new product category for the first time in four years. >> where are you on the wearable stuff? >> that's just it, we are going to see this wearable product. i think it will be announced in tandem with the new iphones and i think it will probably come out shortly after late september, early october, but we know it's been in production to some degree, or you know, pretooling since the first quarter, since about january, february. so, we all know it's coming and that's what i think's going to cause a lot of excitement. >> we have to get out to josh lipton now, the earnings everyone's been waiting for, apple reporting results. josh, what can you tell us? >> reporter: well, kelly, apple just reporting, so let me get you those numbers. apple reporting eps of 1.28 on $37.4 billion. the street was looking for $1.33 on $38 billion. that growth rate highest in about two years. now, i just had a chance to sit down and speak with apple's ceo, tim cook.

cook telling me he couldn't be happier, that this was the best execution of any quarter since he's been at apple, he said. so, walk through some of these product categories, kelly. apple sold 35.2 million iphones in the quarter. the street was looking for about 34.8 million. in terms of where their demand was, cook telling me it was really about the bricks. iphone in china specifically up 48%. developed markets, cook telling me the growth was a bit less. he chalked that up to consumers putting off a purpose as they wait for perhaps a new device to hit the market in the fall. turning to ipads, 13.3 million ipads. that's a bit less than the street was looking for. they were looking for about 14.2. again, cook talked about the strength in the emerging markets, but the developed markets not as strong. however, he said he was comfortable with what he called that bifurcation, that usage on ipads was off the charts and that they were excited about what they had planned in this category.

macs, 4.4 million, better than expected. cook point ad out they're growing in a category that is not. and apple's closely watched gross margin 39.4%. that is better than analysts had anticipated. cook chalking that up to execution and cost. he called that a blowout number. kelly, back to you. >> josh, great stuff. thank you. so, to our jon fortt now, tim cook says he couldn't be happier, jon. >> well, i think, of course, he could be happier, but these numbers overall decent. you know, the eps shows the gross margins are holding up. the ipad number being light might explain the eps strength, because the iphone mix was relatively strong. the release here structured a little bit differently than it has been for several quarters, many years up to this point, not breaking down the specific product categories that josh was good enough to bring us. now we do see that it is in the companion to the release. interesting that the brics in

particular were strong. we're going to want to hear what they have to say about inventory. also interesting that the hold-off to the next iphone started again a quarter early. it's happened that way in the past. i believe it happened last year as well. but the fact that they're already seeing consumers in developed markets curious about the iphone 6. and yet, the iphone number still holds up decently well. all of those things are for investors to consider after hours. >> brian blair, what do you do now with this? what jumps out to you? >> now that we know the quarter's out of the way, numbers are out of the way, now is the time for investors to buy this thing. as you mentioned earlier, we'll see a massive run-up into this next product announcement. but what's interesting, ipads were weak. and that's been a trend. that's an important trend -- >> why are you so confident we'll see a run-up into the next product announcement? >> because if you look at the last five years of apple product announcements into the fall, the stock does that 95% of the time. it actually sells off once products are seen. there's no risk coming right now. we'll see numbers grow on all of

these fronts. >> low risk? >> there's very low risk. >> don't say that with all these retail investors now anxious to get in now that it's more affordable. >> that's right. >> i wonder if you think that will drive the stock price too going forward, but what we've seen typically with stock splits, have we seen the growth you're saying? on one hand, you have the apple story, but also the market story on these stock splits. >> that's why the stock split was so important because this is a more palatable stock, who can look at this stock as opposed to a $700 stock. so, i think we'll see retail investors come into the stock again. >> should that make the institutional crowd nervous? >> i think it should make them excited because they're the ones that have been buying it since march, they bid the stock up. numbers aren't the same as presplit, but they're the ones who came in on the buyback, came in on the split. retail investors are watching this, but they will come in next. what's also critical is the gross margins. apple's gross margins were weak for the whole of calendar 2013. we're seeing a return to this near 40% range and investors love to see that, especially as

institutional investors. >> kevin? >> there's an institutional stumble that actually helped apple. if you think of dollars allocated to samsung, you didn't like that last quarter by any metric at all. you took your dollars out and you moved them back into apple. >> right. >> because you're in the beginning of that cycle we've been talking about. that's another reason that apple looks good for the next quarter. >> that's correct. >> i like their story right now and i want to see -- i don't care about ipads, because frankly, a larger format iphone displaces my ipad. i'm not going to carry that around. it's too heavy. >> that's actually a very critical point in terms of the global market. samsung has done well over the last two years because they decided that the global marketed wanted large-screen smartphones. apple went the opposite direction and now they're playing catch-up. even if they're late to the party, they'll hurt samsung's market share in the back half of this year and next year. >> apple proving it's never too late. thank you. our coverage of apple's earnings will continue. we're going to take a quick break here and we'll be right back. are you sure we should take this billboard down?

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welcome back. our josh lipton doing more digging through apple's results, which have just hit the tape here. josh, what else can you tell us this hour? >> reporter: kelly, let's also

talk about some guidance from apple. apple giving q-4 revenue guidance in the range of $37 to $40 billion. the street, at least estimates i was seeing, calling for about $40.6 billion. apple also talking about its capital return program, saying they return about $8 billion to shareholders through the june quarter. kelly, back to you. >> all right, josh, thank you. apple shares trading off about 0.5% after hours. let's bring in a pair of apple shareholders for analysis. jaron sheshts joins us along with tim lesko from granite investment advisers. are you adding to your positions here? darren, you first. >> no, we have a full position in the company already. it's one of our top positions in the internet fund. and frankly, this is the most meaningless quarter in recent apple history. the numbers -- >> getting existential now. >> it really is unimportant. and even the guidance, which isn't particularly strong, is really meaningless as well, because who cares that the product, the new iphone 6 is going to be delayed? >> wait a minute, meaningless,

unimportant, who cares? tim, what do you think? >> well, i'd have to actually echo some of his comments. we have a full position at apple, so certainly, we'd be buying it for new clients but don't have any plans necessarily to add to it. if we saw a substantial weakness in the stock, we would add to it because the long-term story is probably more intact now than it has been. if you want to read into the numbers, if you look at it, essentially, you have a company who now has emerging markets are starting to fire a little bit faster than it had been. meanwhile, you're now in developed markets have a refresh cycle that's more meaningful than it has been in past years. i think it's a pretty good cycle for apple right now. >> one thing i would add to that is actually going to be china. this is going to be the first year that apple has launched on china mobile, the world's largest carrier, with over 750 million subscribers concurrently with other carriers around the globe. the two variants of the iphone 6 will launch to that important market simultaneously and that will be additive as well.

>> the other thing i would point out is that we've really seen all of the big hitters this year in the android space. you know, samsung, sony, lg, htc, and then really, they've been lackluster, new devices. so, i really think people, the pent-up demand for the new iphone and bigger screen is just going to -- >> so, you guys don't think there's any downside risk to apple coming out with the bigger screen? how do we know this isn't going to tank or flop or something like that? >> tim? >> why isn't this more exciting and interesting? >> well, certainly, it could flop, but i don't see why with all that they have coming out and the existence of the existing phones that there's going to be some sort of big product flop risk. in emerging markets particularly where people are more likely to carry one phone as their whole computing life, it seems like a pretty good spot for them. i would concur with that being available in china will be a big deal. >> so, what about that retail investor carrying that one phone? this may be their second or third iphone, but they don't yet own apple shares. i mean, is this the time to say maybe you don't need the iphone

6 but you need to own apple? >> darren, what do you think? >> oh, i think investors should probably own both. i'm an android user, but i think my wife's an apple person -- >> wow. >> and i absolutely think the new device is a flop? i can't remember the last time an apple device flopped. >> well, the last upgrade was pretty boring on the iphone. i have an anecdotal story which makes me optimistic and makes me want to go longer apple. my son's 18, has the 5s, drops it on a roller coaster. he's borrowed a blackberry to wait for the release with his own money. there's a guy -- >> he would rather use a blackberry. >> and he's whining about it every day. he wants the new phone. he actually thinks this upgrade cycle's worth waiting for and worth spending his own money on. i like that. >> my kids are younger are and one of their friends is waiting to get a phone, doesn't even want a phone, even though everyone else has it, because they want to wait for the iphone 6, so the younger generation wants it. >> where do google and other companies stand in the middle of

this? >> fragmented. >> google, first of all, is sitting pretty, because its apps also run on the iphone. it's managed to lock up a significant presence on mobile across the board, though, apple is pairing that back. i will tell you what is significant about this quarter. if they had missed on iphones in a really big way, then it would be significant. they didn't. they delivered pretty much across the board on all metrics. yes, ipads were light, but no big reaction to that. we know that the news, the big news, the launches are coming in a couple months. this is a dangerous time to get into apple's stock just calendarwise, but this is also somewhat unprecedented in this era. the number of new products that we're expecting. >> that's exactly right. >> so, it depends on how much risk you want to take on if you're an investor. >> and now the focus will turn to the wearable. as we get closer to its launch, we might see some leaked images of it, but this is when all the focus will shift to any new product category, what can it mean? we're telling our customers that apple's initial production plans

are 15 million units. so, whether they price this at $200 or $300, meaningful. >> before we get too far ahead of ourselves, we'll take a break and get into the wearables when we come back. we do? i took the trash out. i know. and thank you so much for that. i think we should get a medicare supplement insurance plan. right now? [ male announcer ] whether you're new to medicare or not, you may know it only covers about 80% of your part b medical expenses. it's up to you to pay the difference. so think about an aarp medicare supplement insurance plan,

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you've made the case. before we talk wearables, talk me through what other impact you think this might have tomorrow. >> i think the fact that there was not a big beat on the iphone will be disappointing to some. the fact that it's run so much this year, some traders may want to take money off the table, but the larger institutional investors who are buying this for the next product cycle, for continued iphone growth and whatever this new category can mean, they're not worried about this quarter. it doesn't matter. it's a check the box, let's move on and see what the next 12 months look like. >> the miss on the ipads not a big deal? >> it's interesting because it's the second quarter in a row we've seen ipads weaker, and i think that could become a concern if we continue to see those units decline, because this has been a big growth area for them for the last four years. and if it's over and if we're going to see that 13 million become 10 and 9, then this watch, this wearable better make up for it, or else it's going it be a problem. >> the problem with that is there are many people, i'm going count myself in that i category, the only jewelry a man can wear is a watch. i collect watches.

i don't want to look like a nerd factor 6 wearing something that's blipg -- >> that's fair, but if it looks like an elegant movado, looks like a great watch? >> if you can get me there on style and i don't have to look like a nerd -- >> he's raising the geek factor and it's real. >> motorola has the moto 360, a watch coming out this summer that looks like an elegant movato. >> can you tell us to what extent the wearables factors into your long-term case for apple? tim, go ahead. >> the wearables, mine, it's really about the new operating system. and the beautiful thing about wearables and the new operating system is it gives developers something to develop to and to make money from. you know, you've got kevin o'leary on the line here. essentially, it's follow the money. somebody who talks about all that. if you can continue to help developers make money, you're going to have a very vibrant ecosystem and put your competitor somewhat to shame. and i think if you look at wearables, you have tory burch

making a fit bit, motorola making something that looks like a movato. and you see plenty of executives with the wearables, whether ups or fit bits. i'm not too worried about acceptance in the consumer. >> the big thing to us about wearables that's important is it's going to prove they can innovate again. they can change the nature of the game. all of the wearables to date, besides maybe the fit bit, have been disappointing. the google watches -- i mean, samsung watches, the google glass. and really, so, apple could show, again in a post-jobs era, that they can innovate, one, and that they can prove -- we wrote a white paper on jacobmutualfunds.com about the power of the platform and proving that the wearables could work could really prove that the ecosystem is meaningful. >> jon fortt, what about you? >> kelly, i think the most -- [ everyone talking at once ] the interesting thing is the halo effect it could create around other apple products, not so much the money they'll make off the device itself. if they come out with a watch everybody wants to have, does

that make them want to have an iphone more? and then on ipads, we have to listen to the call on what inventories did. if apple brought down inventories a significant amount, as they sometimes do, before a product refresh, maybe they actually sold they actually sold out sold through something closer to 14 million, which wouldn't be a disappointment. we have to see if they sold lou. >> shares are up to the tune of 1%. another earnings action we had this hour, tomorrow on the closing bell, we're going to hawaii. not really. we're being to have the ceo of hawaiian airlines to give us his take on the flight restrictions to israel. the airlines fly over war zones, changing flight patterns tomorrow. we'll be back with an earnings recap right after this. we started zya with the thought that the kid on the back of the bus might have a song that he has in his head but he just can't get out. with the technology of cloud, we change all that. i can sing something into my device, up to the cloud it goes, back down it comes, sounding better. we break down the walls of creation

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. welcome back. between apple, microso forth, ea, it's been an after-hour session for earnings. . >> let's start with this, kelly, obviously, with apple pofrtd a mauler than expected quarterly sales, ipad sales fael bit short of those projections. you can see the stock is off session lows. still down about a percent. microsoft is earning 58 cents a

share. that's 2 cents shy of what wall street is expected. sales come in higher than forecast. microsoft shares, they're up now about a half a percent in the after market. then there is electronic arts on the game side of things. it's off its high up about a percent. the video maker posted earnings of 19 cents per share. the street was looking for an actual loss of 4 cents per share. easily beating the 24r50e7b pll the street was looking for. then you see the ea trading shares a percent to the upside. we will start or end, losing ground in the after hours of posting much weaker tan expected ref few. the revenue guidance came if weaker tan forecast. can you see the stock is down 9% just off its session lows, kelly, back over to you. >> all right, dom, thank you. up next, we will wrap up the earnings day and market session and look ahead to tomorrow on knock on trades dom mentioned.

also in the closing bell, tomorrow norfolk southern will join us to discuss his company's earnings and what they're saying about the state of the economy. we'll be right back. being a keen observer of the world has gotten you far, but what if you could see more of what you wanted to know? .

welcome back. let's get some final thoughts from the panel. it's been a busy hour, what is your first trade tomorrow? are you trading tomorrow? >> yes, i am. for me, i keep watching this market move north. i see it's driven by earnings. i think we go higher. i say that with as a bond i say to myself, when is this going to change? because it is, i think the fed is getting behind the 8-ball. we have to raise rates higher than we think. that's what i think. >> are you changing the position in your funds? >> i have short duration 50% in the last 18 months. my average duration is 36 months. >> what about you? >> i'm looking at as the market continues to go up. water happening with the younger generation? i'm looking at the millennials, they're sitting on cash, missing out on all this. who is participating on the runup is most interesting. >> i slightly disagree withpy

friend kevin, like today's earnings reports, pretty mump steady as you go, microsoft, apple. janet yellin is doing i think a fine job of trying to absorb the labor slack that remains in the economy. i think we will see rate staying low for a while. inflation is not a threat. she's doing the right thing. >> apple is growing again, thanks for juan for woking through this, pos tiver cash flow over $10 billion returning 8 billion to shareholders. >> kelly, i'm expecting differed increases, stock buy backs, i'm expecting wonderful things from this company. the only thing you would own it, everybody is detailing. this quarter is very boring. it's very listless, for me, the only reason i own it, it's declared a dividend after jobs left us. they have to keep me a value investor interested. >> a busy hour, a lot going on, "fast money" is coming up in a few seconds, melissa lee, will you get details from microsoft

and apple in the calls. >> we are trading the details. also we got a big move in herbal life shares today. one trade is from $60 a share. we will get an update on how he is managing that. a lot of other people are on the boat at this point. >> i hope he is doing fine. >> "fast money" starts right now. i'm melissa lee. apple's conference call, the company beating still, shipping numbers for iphones and ipads, our own josh lipton spoke with him before apple's call, josh will join us coming up, microso forth earnings fell short of expectations while revenue beat. that call at 5:30. will they give details on the job cuts? we will bring you the headlines as they come in, our traders tonight, let's check it off here with apple. >> listen, i don't think it was too unexpected here. i think the call is going to give us a sense for how