convoy. >> ukrainian troops can't be expected to let an armored russian convoy drive into its territory, if, indeed that's what happened. it appears it did. these reports still coming out of ukraine. the day has taken a dramatic change in tone. kayla tausche screaming for art cashin. i understand he's on set with you? >> he has. thank you. good to see you. we'll take from here on this side of "squawk alley" with art cash rn. looking at the ct markets. dow down 50. had been up as high as in the 70-point range. s&p now down 4. nasdaq down just a fraction of one point. it was slated to be the best week for the s&p in four months. best week for the nasdaq since early february, but you can see what some of that escalation intentions in recrane has done to the markets. every headline like the one we are getting this morning has the potential to move the markets like this. so we want to put context behind

this. you just heard the conversation between michelle and brian, we have been talking about this humanitarian aid convoy for weeks at this point. nato had raised questions about it, and now ukraine decided to act, but what it about today's news that has causerd the markets concern? >> looked like no confrontation. allowing, supposedly, the red cross to come in and examine what the contents of the convoy were, and then sudly have we got word from serious news sources, that leschenko said an armored convoy had come in. this may be different than the one we're talking about, that there is little hard data so far and the great one is the one michelle alluded to, will this give putin the kind of pretext he needs to come marching in. >> it's brian again. could i jump in here? i might be able to answer your

question. the column, or the trucks, or troops, we don't know how many, from russia, apparently military and not humanitarian, according to the two british journalist ares who were there and tweeted this out yesterday it is entirely separate than that 280-truck convoy. literally yesterday, two british journalists said we just witnessed with our own eyes two armored trucks go into ukraine, russian trucks. it's getting attention because of the reescalation by ukraine. >> and the fact it's confirmed to dow jones industrial by a german foreign minister. so that lends some credence, in addition to some on the ground eyewitness reporting. so given that, art, how far can we go from here and what does that signify? >> we have to get real clarification as to what has happened in the sense of have some of the russian troops become casualties. is it just some of the equipment is gone?

that could really, really heighten the confrontation that's there, and it that's why you can see the market os la, o wide open allegations and news reports without a lot of substance. we can expect volatility on an expiration day as we go into the afternoon. hopefully we'll get better clarification by noon or so, and then the market will settle in. >> we're seeing the german bunz beloan 1 percen belo below 1%. what should we watch on either of these benchmarks? >> i would think that -- if the bund guts down 2.-oets down to . it could get there. >> may have gained credibility. >> i love your point, art. what happens, we've seen it happen not just with this

situation but with others. one person in a semiofficial role says something. other journalists, particularly international journalists pick it up and maybe lose something in translation. suddenly now you have multiple sources saying the same thing, but it's actually just coming from one person, who is has been reap quoted and maybe lost a bit in translation. nots sure if that's the case here. certainly not. but your point of taking headlines is well noted. >> doing it 50 years. absolutely. it's not always the first mouse that gets the cheese. >> art, you'll stay with us. brian, back on-set for the hour. thanks for rejoining us. we want to bet to the cnbc newsline. michael mcfaul, former u.s. attend to russia joins us. ambassador, thanks for joining us. >> sure. thanks for having me. >> we were talking just yepd when putin was making a speech in cry kneekreye miya, he wants this as soon as possible. should we believe him or call

his bluff? the fact there is a military column enters ukraine does that continue to whittle away any credibility he could have going forward? >> well, president putin has always said he wants to end this, and seeks negotiations, and what he said in crimea yesterday was really no different than most of his speeches from the beginning of the conflict. he just never backs those words up with actions. and he's continued to escalate this crisis. there's been no evidence whatsoever on the ground that he is seeking to de-escalate or to put pressure on those rebels that he supports. again, i'm listening to your show and agree we all need to be very cautious with the initial report, but when that convoy was on the move yesterday, there were also apts reported on the

move and it was the case that the ukrainians did take out russian military personnel in ukraine. there's going to be a russian response. no doubt in my mind. >> ambassador, a number of things about this just seem odd. i mean, what people are saying what putin is saying, doesn't seem to line up with what's happening on the ground. russia clearly has a lot of military capability. why just this one column, that's there for ukrainian forces to target. how cautious, and you just mentioned caution. how cautious do we have to be about interpreted exactly what's going on before we get more from both sides on what's happened? >> well, again, it's the reporting, it's very spotty and difficult. right? and i'm following the same set of journalists you all were just talking about as well astrain -- ukrainian journalists, also

military people going into ukraine. the you ukrainian government just reported, that they attacked that military convoy. and i would just say in the broader context, putin has not been doing well in terms of his strategy in eastern ukraine. right? his guy, his mercenaries in eastern ukraine have been losing. and if you look at the reporting out of russia, people are beginning to wonder what's the strategy leer? w here? what is he doing? the nationalists are saying, why isn't putin doing more? this could be his stoep tep top to do more. i want to be careful. i don't want to say if they do the same thing every time, but remember how the russian-georgian war started. that was initially a set of peacekeepers, alleged

peacekeepers, but russians, that were attacked by the georgians, then he responded in a major military way, after that. >> he did. >> after the georgian attack. >> we are speak wig ting with t former u.n. ambassador to russia. they destroyed effectively a russian armored troop that had gonen into ukraine. ambassador, knowing vladimir putin and what you just referenced about georgia and also what you said to kayla a few moments ago, that if true, this will merit a russian response. how do you perceive russia responding, if, indeed, this is true? would it be an eye nor an eye, so to speak? or would it be a more dramatic response by putin? >> i don't know and i don't want to be misleading that i do know. all i can say is he rarely backs off symmetrical responses and other conflicts we've had with

him while i was in the government, they were rare. they were usually asymmetrical. and, again, if this -- and i entirely agree with your previous commentator, that what can the ukrainians do if the russians are moving military equipment and personnel into their country? they have to respond, but that, in my opinion, almost certainly guarantees a russian military response in return. i just can't imagine that whohe would just allow to hoop and then just say, everybody let's go home. pull our trucks and return. >> this conflict has been ongoing for several moss but it's been weeks since the markets hung on every single headline. have we entered a new round where every single thing that happens in this conflict is going to be meaningful? >> i think over the next several days, for sure.

we'll see how ex-textive this military response is sand right news to skepticism is building in the markets. we're beginning to see the yields start to inch back up a little bit. gold has not moved, and we're certainly off the low. so the market's trying to parched. >> i understand the threat of conflict and we have to separate, art, because we are cnbc, the difference between possiblish be -- it's ailes a cold thing if you have to. piece together what's happening on the ukraine-russia border with the stock market? is there fear sanctions will grow, stocks cut off? russian gas, while important to germany has not been threatened yet to be cut off. why are we down on this? >> we're down, because the remembrance of contagion we all saw in the 2008 crisis, and think of where we were, eve be

when things look conciliatory, in the past couple of day, germany, on the verge of extension, if we get far more extensions, that could slip. europe is on the verge of deflation. we could get that coming in here. remember, 25% of the s&p gets more than 50% of the income from offshore. so there's a linkage here, and, e yes, there will be economic consequences. >> art, we'd love for you to stick around and parch through some of the news going through the rest of the hour. so thanks for jump into to action as always. our thanks also to former u.s. ambassador to russia michael mcfaul for coming to the newsline and help us put it in context as well. more on the markets and escalating situation in ukraine when we come back. dow down 42. nasdaq for its part of this hour edged slightly positive. "squawk alley" will be right back. in today's market, a lot can happen in a second.

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welcome back to "squawk alley." take a look at cried oil railing wetter th better than 1% the move possibly because of an idea when focus of the west is on russia and ukraine, that potentially it would lose focus from what's going on in iraq, and with isis militants, and the current situation there. so you are seeing a slight spike

in wti, 9668 right now. >> isis probably wants the world to not pay attention to what it's doing. more hot spots, the world's collective attention is diluted a bit, art cashin. that's fair to say, i think. perhaps a move in crude. be real ichk. a lot of pyne liipelines in thi region. russia none more for gas than oil, but the second largest -- >> the data you believe oil producer in the world and now you've got a nation that, if it does retaliate to the point of the former ambassador to russia, as he just said, will happen if indeed these reports are true, you're going have an isolated bear increasingly. i use that word obviously with pointed past meaning. in the world that controls a lot of the stuff that we need. >> and also leading to exacerbating the volatility somewhat is we have a weekend coming up.

so these developments, what happens over the next several days trigge s traders won't be interact with. >> and then add this sort of extra volatility already into now these headlines? >> right. so everyone is going to get as much data as possible and then will try and figure out, how can i position myself to go into the weekend? limit my losses, and to -- i think more limit losses than trying to profit from it, to begin with. >> we're getting more headlines out of this situation in russia, and ukraine. for that back to headquarters where michelle caruso-cabrera is standing by. >> hey there, kayla. the president, poroshenko, posted a statement on the website of the country. he's saying he had a conversation with the prime minister of great britain, david cameron. he says "the party's coordinated their actions on the response to the information regarding the entry of the russian military machines into the territory of ukraine." suggesting, if i read this correctly, the united king dom

knew what they could do. the british prime minister reaffirmed strong and gradual support to ukraine and the actions of the president. so clearly he's having conversations with western leaders about what's been happening there on the ground. so that's the latest. we'll come back in a few minutes with the european close and show you the ripple effect as a result of what's happening what we've learned in the last half hour or so. back to you. >> thanks for that, michelle. we'll check in with you momentarily as this news develops. and getting headlines in reuters. nato accusing the kremlin of escalating the conflict. they are pointing the finger at russia saying, you caused this to escalate. not ukraine which had been tracking those armored vehicles, that military column, coming across that we now know, or at least expect to have been separate from that convoy of 280-plus trucks supposedly bringing humanitarian aid. >> from a data perspective, an

update. we'll hit the european close and give you a live read. guys, bring up the dax in germany. this is a point. dax down three quarters of one percent now. most other major markets are either up in europe on fractionally down, art. the dashx is down nearly 6% in month. the reason we highlight this is, there is europe and then there is germany. germany's collective economy is about the same at the rest of europe combined. this is a big deal for a big economy. >> and they are the people most involved with the sanctions and the impact of sanctions from russia. and to your point, it's -- pretty obvious that's why poroshenko talked about the british prime minister. they're going to try and involve whatever action they took with the majority of nato and other allies, and see if they can hint to putin, we're not alone on this. there are others coming in. you're going to get that bobs and weaving going on all through

the day. >> bobbing and weaving, certainly. looking at the u.s. markets as well. dow down 50. s&p negative. nasdaq is managing to hold in the gains. two points. why do you think that index has been able to brush this off relatively? >> one of the things, they feel it may be least exposed to europe. while some of the big technology companies certainly are. but a lot of the small nasdaq operations aren't, as opposed to s&p and the dow-type multi-nationals. >> even previously, one big move in a stock likie iayandax? >> it is an explanation day. tides going on beneath this not necessarily immediately news driven. there are large positions to be resolved and that may provide a bit under nasdaq. >> vix is up 11%.

note only over 13%. vix is up 11% but historically very low. nopt at 40 or 60 like it was a few years ago nktsds a years. >> and gold has not spiked. >> weird our asset classes are diverting, except for bonds and stocks. >> that's what traders look for. to see if everything is going as you would expect, and if something is not, that tells you a little further analysis will probably do. >> jackie deangelis, the trade on oil and reaction. >> just when we thought geopolitics were off the table, we've seen oil prices spike in the last few minutes on headlines coming out of russia and ukraine. gains of more than 1% on both of these. a couple factors pushing oil a little higher this morning. buy on the dip mentality and some traders saying we had gotten too bearish and wanted to get back in the trade plus a little weaker dollar as well.

certainly the action we've seen in the last few minutes is definitely based on these headlines, and it's strange activity here on a friday when we do have low volumes going into a weekend to see these kinds of spikes, but obviously, traders are concerned about what's happening there. art cashin mentioned gold as well and i want to highlight we were under 1,300. yes, haven't spiked on the uncertainty bet definitely regained ground and are back over 1,300. around 1305. it's taken a lot to move gold around. you expected more. all fluid now and will depend how it shakes out the rest of dpapt expect gold prices to move potentially higher. back to you. >> thanks, jackie. we'll keep an eye on gold, on oil, on treasury prices, on markets abroad, everything is moving this morning on the back of reports that ukrainian forces destroyed part of a military column coming into the country from russia. you can see right now what it's doing to the ten year. yields plummeted.

wti sitting at 9665. dow losses escalating, too, continuing to be into the red. now down 64. and we will have more on this situation when we come back in just a moment. lly has no hidden fees on savings accounts? that's right. it's just that i'm worried about you know "hidden things..." ok, why's that? no hidden fees, from the bank where no branches equals great rates.

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welcome back on the cnbc newsline right now in the wake of markets being near their session lows, we bring in nicolous. nick thanks for joining us. >> absolutely. >> keep your eye on the ten year, art said as walking off the set. at session lows, could go lower depending what more news we get out of that region. what do you have your eye on in markets today as nearly every asset class seems to be sensitive to this news. >> should be sensitive. absolutely. on the ten year side obviously the tensions in ukraine feed into worries about the continued

slowdown in europe, and what looks to be a very, very sluggish economic situation over there nap feeds into worries about earnings. the individual sector movements what i find intriguing, energy reversed and begun to move higher on the back of better crude prices. so there seems to be a selective sell-off in equities but a risk off move in terms of bonds. >> does this have to do with direct impact on u.s. economics, corporate earnings and u.s. stock market or are we reacting to a proposed problem in germany? how far away is the united states market? >> two. first geopolitical risk, wanting to harbor assets from volatility related to a hot war in ukraine which seems to be picking up in tempo. second, corporate earning. bracing for a lousy set of numbers from the europe poon operations of u.s. companies on

the back of slow growth in gemini and the energy complex in europe so reliant on russian gas and oil, puts additional fuel on that fire. >> we now have news, nick, that ukrainian leaders informed uk prime minister david cameron nato has been brought into the fold as well. what, if anything, do you expect the u.s. to do in response to this? >> it does seem to be a situation that has become rapidly the geopolitical versus the conflict, the u.s. will view its role through the lens of its european partners since they are so much more xpoetz xposed posi the situation in terms of a geographic location. >> give viewers a quick update. dow jones industrial average down 68 points. down 0.4 of 1%. not a big collapse in u.s.

stock. the dramatic has been the change. the small and mid-cap stocks aren't moving as much. obviously, do not export to europe. no small cap is doing a lot of business in germany. if you were going to make a recommendation on staying in equities with your clients, would it be look smaller, look for companies in wisconsin, selling to iowa, et cetera? >> an excellent point. you want to look for companies that rely more on the u.s. economy versus the european economy, and in addition, as we know, the small cap stocks, the russell 2000, has really been beaten up over the course of the year relative to big caps. you can see this kind of news begin to generate interest on a rotation out of big cap which has been the trade this year and back into small cap as we go into the balance of the year. >> and, nick, what about large caps overall? because generally, when you think about a small cap company, a small to mid-size business, it's unlikely that's one with rapid expansion, with many offices abroad, but if you do

have money, diversified across large cap stocks what would you tell them? >> i would say, we're looking for both yield plays, and i like the consumer staples here for that, versus utilities that have had a monster run this year and i think the energy complex, a large cap energy stocks, also holds promise, both through their yield and for the potential of benefitting from slightly higher crude prices and a still stable u.s. economy. >> can i ask what's going on or not with gold? on a move like today, gold should be higher. it's not. gold is actually down 0.8 of 1%. why is gold the ultimate safe havin besides treasuries not seeing a bid here? >> seems gold lacks in geopolitical events. so many other factors from indian wedding season, demand for gold in emerging markets to what goes on in the industrial complex, so it's a little hard to say. gold has obviously spiked here from $12.94 tos 13ds.04 on the

news, but it's acting sluggish relative to what you and i would expect it to do. >> nick, given it's a day with an explanation occurring as well. earlier today we were talking about potentially being able to tiptoe into the weekend even with that expiration looming. given the volatility they has recently been introduced, how do you expect that to play out this afternoon? >> well, i think everything equal, see a sale justify into the afternoon, two deys you can't trade. the sneer you see incremental events take place in ukraine over the weekend that you couldn't respond to over the weekend and have to wait for monday. i expect this to sell off through the balance of the day. >> nick, appreciate you coming to the phone and join us on a very, very rapidly moving day. >> absolutely. thanks so much. >> nick colous of convergeous.

let's get to michelle caruso-cabrera and hk to tell us what else is happening within the broader sectors of the market. >> start to roll through the charts. you see what happened intraday, german dax closed at lows. i suspect we'll see the same with the cac. the first response from russia. interfax is quoting the russian foreign ministry as saying that the ukrainian forces are trying to cut the route for the humanitarian aid using threats of force against the humanitarian convoy. so this could be the beginning of the pretext, oh, see what the ukrainians are doing to our humanitarian aid. we'll see how it plays out. that appears to be the first response to this situation from the russians. brian, to your point early why didn't people react? the german foreign minister is saying, "it's a larger -- a larger quote. refers to this occurrence with

the russian con voice. "unfortunately normal. nightly, an unfortunately normal and nightly course of events." see you have to wonder why suddenly now this is an issue? maybe it's because now that western journalists have seen it, the uk knows about it, it's confirmed, maybe that's why ukraine felt more emboldened to attack this russian armored convoy that came across the border overnight. we are showing you the dax. also going to show you the cac. we want to show you as well what's happening with the german ten year yield. the cap will close with the lows as well. bund up .967. off the lows are earlier, and we'll show you the uk ten year fallen, the yield fallen to levels we haven't seen since the summer of 2013. 2.3%. show you with trysting things happening with currencies. swiss frank, safe play. three week high against the

dollar. euro as well, strengthened and may be counterintuitive but i'm told by a markets editor this has to do with a big short position in the euro. maybe a squeeze going on there. show you the ruble which has now fallen to a low. why it's confusing is because of the bond now, showing you a chart of the dollar. every time it goes up, the dollar is strengthen but the ruble is weakening. the russian market, which is going to be, if events continue to to escalate over the weekend, this is a market that is going to be very, very vulnerable and susceptible, because it's been rallying, just like the united states, all week on this tonality coming out of putin and the foreign ministry that appeared to be softer. so this has a potential to be a real turnaround story on monday when it reopens. back to you. >> great analysis going through all the markets. staggering yield there. dow down. boeing united health and at&t

the three biggest decliners on the dow now. go to a very short break, folks. key it here on "squawk on the street" or "squawk alley," because there is so much going on in these markets. headlines crossing minute by minute. full analysis, breakdown, reaction, all continuing on. we're back, right after this. ♪ ♪ 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. where the reward was that what if tnew car smelledit card and the freedom of the open road? a card that gave you that "i'm 16 and just got my first car" feeling. presenting the buypower card from capital one.

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bringing back the chief international strategist at wells fargo pap couple days ago you put out a note use weakness in europe to buy more. do up still see that agency the case? because germany is down 3/4 of 1% now. >> right. we think it's important to recognize that the dax, though it fell on the news reeshtaineds gains for the week, and the tonality as your reporter described it, will go back and forth between positive and negative, but we don't think that this is the beginning of something new. we don't think it was some sort of underhanded, or sleight of hand. here's the aid with one hand and here are the guns with the other hand. it's really more a case of the russians have been continuously supplying aid, military aid, through dirt road breaks in the border. it's been going on for weeks and months, and this particular one happened to get caught just at the wrong time. so this is not necessarily the beginning of something new.

it's more likely that this is interesting information for mr. putin, who now sees that his attempt at trying to get the west to respond to his aid of one sort, military, and now there's aid of another sort, humanitarian. he sees the wecht ast are and t ukraine are ready for something noor that and makes him consider stepping back, actually, from the break. >> one thing we haven't done enough of, which you highlight smartly, in my opinion, the ukrainian economic tide to russia. we're talking germany, natural gas and russia. the ukraine industrial base, especially the steel market, their biggest market is russia. what incentive economically does ukraine have to try to find a diplomatic solution to this? >> well, a an enormous incentive to try to find a solution, it's not just steel. it's also petra chemicals, very

nornt ukraine. i would maybe swap the sides of the tables a bit and say, russia has an even bigger interest in making sure that this does not deteriorate into something that involves western military power gns russian military power, and that incense sieve that russia has the geography and all the time in the world to continue to put pressure on ukraine. it haven't have to invade to retain leverage on kiev. the invasion, in our view, the most expensive of the options russia has. these sorts of events as we're seeing today will produce pullbacks in the market, surprises for the market. the tonality had been better this week. we saw that as well and think it may go back and forth for a while until becomes clearer both sides have a strong incentive to avert the worst case. >> seems russia has that, especially given the effect of these sanctions, to name one

thing on their economy. yet i quote the 2345i9 oh spokesperson talking to reuters, va russia is doing the opposite of what it's saying even as it calls for de-escalation. do you get a sense of someone watching it unfold from the outside that there's any chance of them delivering on what they're actually saying? >> i think what they want is, like a lot of countries, to have it both ways. they'll say one thing at the diplomatic level to do something quite different on the boots on the ground level. what russia, i believe, wants, is to maintain leverage over ukraine the politics and will do it to the extent they feel they can get away with it. i offer the whole theater with the 250, or 300 trucks painted white, we're following them day by day across russia to ukraine is an attempt by putin to collect information on how responsive kiev and the west would be to whav sort of overture he makes actually on

the ground at the border, and what he's seen today is while the initiative seems to be peaceful, then markets will rise. if there's something that hap n happens amiss, say one of the routine border crossing by russian troops trying to aid rebels, that will also invoke a strong response. that's a strong positive signal back to him from the west that, hey, we're watching this and really mean be it this time. >> let's back it up just a bit. one of our listeners, say sitting in traffic on the 405 in california, headed to work. right? in their mid-40s. got 20% of retirement funds in international funds. what do -- they're listening to this thinking, okay. what do i do? paul christopher, what is wells fargo advising its clients to do with any money they might have in international markets right now? >> we think this conflict will be contained. in this strongest pliklikelihoo.

we think retand. the that it's on a positive tra jictry and, therefore, a buying opportunity. more diversified. >> so, paul, you say this will be contained. we're getting a statement moments ago from the eu which says, the need to find a political sustainable solution to the crisis is is a matter of urgency alling on russia, ukraine the u.s. as well as nato to assist in this. do you get the sense that solution can be reached, if not quickly, then at least in a manner that keeps this situation from really escalating? >> again, you never really know with these things. there's always that probability of something unexpected happening, because we're dealing with people on the ground who have imperfect information. right? troops on the border do things and then people react to those things, but the most likely scenario, very most likely scenario, we believe is that some political solution will come up, be ob titainobtained, a

will exercise one of its many leavers to continue to have leverage on ukrainian politics. >> we'll continue to watch this situation, paul, we appreciate your and wells fargo's take on the markets and what people here at home should be thinking about as we're watching the dow down 60 points intraday. when we come back, to rick santelli in chicago on the moves in yields we're seeing on the headlines out of ukraine. ten year yields touch aglow intraday 232 earlier this morning. it's a 233 right now, and we'll get rick's take in just a moment. stay with us. she's still the one for you. and cialis for daily use helps you be ready anytime the moment is right.

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so you can invest in the life that you want today. tap into the full power of your fidelity greenline. call or come in today for a free one-on-one review. look at the ten year. 232 at the low yield of the session. now traders buying treasuries as the conflict escalates in ukraine. thoughts from rick santelli standing by at the cme group in chicago. rick, you watch a chart like that, what goes through your mind? >> well, a lot of things go through my mind. the first thing that goes through my mind being an ex trader, that markets have a predisposition to ge where they want to go, and things like geopolitics usually change the timeline. they don't really change the issues of the marketplace. what i mean is, here's a chart going back to mid-2012 for ten-year yields.

it's important, believe me, art cashin is the man and always going to be support, but if you draw the main trend traders have been looking at from mid-20127 top spring of 2013. that line comes in slightly over 2%. when we broke under that significant low yield of the year created from may 22, to 244, there isn't sbag port until you gelt to about 2%, which is where that line comes in. the reason i bring this up is, yeah, we're going to pause at areas 236, 232, maybe around 225, big psychological area, but the point is, that year to date total return for ten year as of yesterday's close was 8.1%, for a 30-year bond, closer to 18.1%. that doesn't include today's moves. so there's already a predisposition oopy look at foreign exchange and see the euro current sip was hardly effected. the big movers?

equity markets? dax? it's a friday. one thing we know, this geopolitical skirmish going on between uk, russia, the u.s. and europe, well, it's an markets and sanctions as well. mr. putin obviously learned things happening on friday get exaggerated due to the weekend. i question whether the dax should have moved up to 9300 at all. the fact it moves slightly below 9100 and bounced back to me is where it needs to be. it's what markets are focusing on but we are remit if we don't remember there are theming to the marketplace in place all year. geopolitics changes the aggressive tendency there. >> rick, heard what you had to say about geopolitics and you're just doing the technicals here. how much -- i knee you've discounted some of this -- how much of the moving yields is directly related to these headlines, and thus might be temporary and transitory, versus the longer term threat?

>> well, i think for today in particular, about an extra three to four basis points. probably wouldn't have shown up if equities didn't get dinged due to the political issue. we'd be 2362, 37. in the grand scheme of things, 236 and 2. i don't think geopolitics had a huge effect where trish treasuries are, period, outside the fact they are indirectly linked to equities. your real question is, how are frothy investors, internationally, whether in the dax, cac, dow, s&p or nasdaq, how is their psyche, internal stomach holding up looking at fundamentals like today? tick day, brian, minus 153.5 billion, the biggest monthly drop since the index was created in 1978. so my issue to you continues to be, it's more of a frothy equity issue.

which, in my opinion once again, they are dingable. if they weren't vulnerable, i think geopolitics would van effect, not nearly the volatility it's seeing. >> just to be clear. listen, i love you and like the fact you're making kind of an outlier bold call here, because if i bring up the intraday chart of the ten-year yield or intraday chart of the dow, it's clear 10:30 eastern time we saw headlines starting to cross about this incursion and likely attack. the dow tanked. yields also came down as money came into bonds. seems almost perfect to the minute, rick. >> no doubt about it. it's perfect to the minute, because when you rourch the equity markets, you run into the treasury market. they happen roughly at the same time. and i think once again that we are vulnerable. we're vulnerable. if this would have happened here, brian, in may of 2013, when yields were making that huge move from 160 to 260, i contend and we can't prove it counterfactual, it would have had much less impact.

much less impact. >> yet, rick, we're still watching the bund in germany. one year, below 1%. two year, negative. seems to be a lot of fallout from these escalating tensions amid other growth data -- >> kayla, we're quibbling about a market. put this in proper context. let's say that the market and boons at 125 if it wasn't for geopolitical issues. sounds ridiculous still. 125? unbelievable. traded before this latest round happened with the geopolitics. yes, gone through an extra three or four basis points, but when you leook at yields in europe pshgs one year, two, year, three year, negative. a lot going on to mike geopolitics the only antagonist to me is artificial. >> we'll give you the final word. the debate is not over. on the other side this

break, more news from the commodity pit here from the nymex, gold, oil, moving on news that ukrainian forces have intercepted a military column from russia that has entered the country. more on that on the other side of this break. (trader vo) i search. i research. i dig. and dig some more. because, for me, the challenge of the search... is almost as exciting as the thrill of the find. (announcer) at scottrade, we share your passion for trading. that's why we rebuilt scottrade elite from the ground up - including a proprietary momentum indicator that makes researching sectors and industries even easier. because at scottrade, our passion is to power yours.

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track to be the best week for the s&p in four months. best week for the nasdaq in six months, but you can see when we get headlines out of ukraine on that situation in russia escalating, that's what happens to the marx akets and why we ar reacting and covering this to you. over to michelle caruso-cabrera for the latest. >> threatening now, 2.3 level. 2.31. the bottom line -- it appears the ukrainians have directly attacked russian armored vehicles. if we understand the situation on the ground, that would be the first time we've seen this situation. to back everyone up, everyone's been following the human karen aid conflict, the last two days. filled with water, baby food, et cetera. two british journalists following along with the convoy, tweeted last night, brian highlighted, by the way we saw 20 russian armored vehicles cross into ukraine right in front of our eyes.

and in response to a question from the tweeter, the journalist says, no. i think it's actually happening all the time but startling to see it yourself. we think overnight the ukrainians attacked that armored con sproip that's what we're learning about now and why we're seeing a sell-off here. the question is what will be the russian response? the only commentary we've gotten our the russians thus far is they're claiming the ukrainians are trying to stop the humanitarian aid. big fog of war going on. two different convoys, apparently. show you the bbc world service. witnessed 23 russian vehicles cross border into ukraine on bbc newsday, tweeted last night. i believe the other one as well from sean walker working at the guardian. >> we just saw a column of 8 pcs and vehicles with official russian plates cross over into ukraine. this is all last nile night. the markets are reacting because

we're learning what appears to be a military fight between the two. one more additional point. poroshenko, president of ukraine, claims he spoken with david cameron, prime minister of the united kingdom and they've coordinated. to what degree were the brit it's involved in the decision-making about what would happen here, and is it the first time the ukrainians attacked a russian armored vehicle, and why do it for the physical time if they know they've been crossing a lot. >> lots of uncertainty. pushing the dow down lower, even down 134 points. >> michelle, thanks. big move, skeller ating on the down side. oil starting to go up. jackie deangelis, back to you at the u.s. mercantile exchange. still seeing a sizable bid coming into the oil markets? >> we are, headlines out of russia and ukraine and the uncertainty michelle mentioned. traders telling me they don't want to go into the weekend and be short crude, certainly, which

many traders were. now lookingality this saying we want to be long because potentially something could happen over the weekend. we've seen this in situations before. they come in on monday and get crushed if the fears do not amount to something over the next couple of days. interesting to see what happens here. west texas intermediate, close to $97 a barrel. seeing gains of more than 1% on both of these contracts. talk about gold prices. you asked about them before. gold regaining a little ground from its morning lows, not spiking on the news, because traders tell me that headlines from the minneapolis fed president saying in a speech this morning that inflation will stay subdued until 2018. that's what the gold trade is about now to the long side. it's an inflation hedge. so given that information, this market does not want to be long gold right now. back to you.

>> jackie deangelis, thank you very much. take a look at market and stocks. ten year treasury note. on the radio, at 2.31%. i guess weird upside into this, that if you are thinking about buying a home or refinancing again, this could set off, kayla, another refinancing move. seems weird and crass to talk about everything going on -- >> talk about mortgage providers, at the end of the refinancing cycle. every consumer able to do it has done it. >> did they anticipate this? >> go back and get an even lower rate. very perverse when you think about t. jon fortt, listen, you can see mortgage rates back to 3.5%. seems odd. take it out. it you're in iowa, wisconsin, wherever, you may think you don't want anything bad to happen in russia, ukraine but thinking, hey, the real estate market will pick back up. maybe get back in? >> a whole weekend to shake out what going on. at least as we head into next week. >> for one bill gross tweeting

via pimco owned treasuries, on, too, later? >> thank you, kayla. exactly. word from our producer here on "street signs," top of the 2:00 eastern show that guy, bill gross, talking ak the ten year, mandy, myself, back at 2:00. thanks have having me stick around. >> sendback to headquarters and "the half." thanks, a seamless transition and continue to talk about a developing and breaking story. this escalation of violence out of ukraine. joined by traders. joe, pete, josh and jon as well. josh, what are we to make of what we're seeing in the markets here? a dramatic turn from what was a positive day now an escalation of not only fighting but selling? >> two things worth noting. first is, how jittery this market still is. the s&p came off almost 20 handles, soon as this news broke. however, it is up about 2.6% off the correction lows over the