intuit. whoever wins this will on to battle paychecks which was a real underdog because paychex. >> upstate new york love it. thank you very much. thank you all for watching "power lunch." the dow down 204 points. oil is up. big last hour of "closing bell" starts right now. welcome to "closing bell," everybody. i'm kelly evans down here at the new york stock exchange. >> and i'm bill griffeth. a big sell-off right now as brian was just itemizing there for you. a lot of moving parts and pieces going on here as we know. military issues in yemen have served to push oil prices sharply higher today up as much as 4% for both wti crude and brent crude. that has pushed many oil sensitive stocks down sharply. the transports for one are down hard today.

you had a sloppy five-year note auction for the treasuries today. that has served to push some yields higher today, so there's been a sell-off in bonds on the long end of the yield curve and so many other things going on. >> you want to talk about some of the data we've gotten. that first quarter gdp number doesn't look that strong and earnings. we have a lot to get to. we've on a watch for a new high on the nasdaq. not happening today. that index is down significantly. it's the russell that's up there right now and not the nasdaq, our old friend on the board over there. interesting change. >> you're right. they did move that. look at that, down 22 points. that's for us to worry about, not you folks. another of the culprits moving stocks lower today, biotech looking very sickly. look at that, 4% decline for biogen which just the other day was zooming on the alzheimer's drug story and others are following suit as well today. that's another sector we're going to look at that's causing some of this sell-off. >> lots of comparisons to the dotcom era in that one.

today's red arrows coming even with the giant deal in the food sector. warren buffett's heinz buying kraft and it will create one of the largest estst companies in the world. >> some of my friends have been saying they saw that merger coming for years because they have been putting ketchup on their mac and cheese for a long time. >> there's one i haven't actually tried. >> me either. >> i know what i'm having for dinner tonight. you're invited. >> more problems for apple pay. is it simply too easy to enter stolen credit card information into the apple pay app and then go on a shopping spree? one analyst says he has data to prove that very point right there, and we will get both sides of this still developing issue regarding apple pay. >> speaking of apple let's take a look at where markets are. the dow is off 219 points as we enter the final hour of trade. this puts us 500 points away from the recent closing high

which was a record of march 2nd only earlier this month. the s&p giving up also about 1%. it's down 21 points today. there's the nasdaq off 93. by far the underperformer this session. usually it holds up relatively better better, but 4,900 is the level we're looking at. >> biotech a big part of it. jack bouroudjian is with us from index financial partners. so is margie patel and rick santelli. rick, you're watching all these moving parts and pieces on the market today. does it all make sense or are they going in different directions here? >> you know i know many want to say, listen, if the only good hedge to weak equities is treasuries, why is the yields going up and the price going down but be cautious with thinking about that, too long. first of all, we're 25 basis points lower in yields in the 10 than we finished at 2.17% last

year, and the dow is unchanged. so there is still that bias. but i do think that the reason we're somewhat out of phase today is partially what happened with the 5-year note auction but i think it speaks volume that without any new news, i really think that the treasury market is priced about right. 1.86% is huge support in 10s basically yesterday those were the yields we closed at. so i'm not surprised that yields have moved a bit higher. if it's a dynamic that continues in an aggressive fashion, then i think we can kind of look towards other areas, but right now i just think that it's two markets kind of doing different things. i think the equity markets are responding to some of the weak news, after math of the fed, and be cautious, today's durables as ugly as it was, for a change the nonseasonally adjusted side of the balance sheet for that data point was much stronger. >> jack, i want to ask you, it's

interesting having this discussion at lunch today the fact we've taken a bunch of supply out today. look at merck's buyback look at the kraft deal. you know, i don't know how much that adds up to, $30 billion, $40 billion we're talking about, and we're seeing the dow giving up 200 points. what do you make of it? >> kelly, i think we have to take a look at the calendar. something people aren't talking about today is the fact that we are getting very close to the end of the quarter. now, what does that mean for us? well, the japanese have got four days to settle stocks. they have t plus four. we have t plus three. a lot of what you're seeing today is a large footprint from what looks like profit taking. they're selling everything across the board. if you look at what they're buying, they're buying whatever they were short and that would be oil. so all of that tells me this is really end of the quarter type of action. the real question is what we see happen going into the beginning of the next quarter. remember, one of the xhings that worries me is that we're entering a very difficult time for stocks. look, you don't hear me get cautious very often, but i do

get cautious in the first couple weeks in april and the first couple weeks in october so we got to be very very careful. this is the time to put on protection and be careful and look for that 5% or 7% move. it could come very quickly. >> margie, let's get you in here. what's your mindset? and i think about oil here as well. there are those who say that oil is, you know, works in lockstep with equities because it brings the oil price and the oil stocks higher, but they're going in opposite directions today. so is oil a friend or an enemy of the stock market right now? >> i think it's a long-term friend. i think opec is broken forever. we'll never see prices as high as we did a year ago and i think that's by putting money in consumer pockets. and i don't think you can look at those relationships between oil going up and down compared to previous cycles because with opec now no longer effective i think we have to look for new rules about what's governing the

market, but i think we're due for a correction here. >> how much further does it go, margie? >> well, we really just started, and you can see some of the area that is have been very spiky like the biotech are the ones that are having the biggest correction, and we have earnings decelerating. we don't have any fundamental additional good news, so that says to me the market should continue to go lower so i would look for that 5% or 10% correction in the spring which we often have. >> you know, jack even though you and margie and perhaps many others are looking for this correction, isn't this an opportunity for a lot of retail investors who we know haven't really been involved in the stock market to get involved unless you think the overall trend, the overall cycle if you will, has come to an end? >> that's exactly why i bring it up. people aren't really made to time stocks. i don't recommend that unless you're a professional, unless you've been in the markets like rick and i have for 30 years, but if you're going to or if you missed it, look for the moves down and take advantage of them. the 7% 10% moves which we are getting, and we got it last

october, are wonderful gems of opportunity to put money to work, and, look, fundamentally, things are still looking good. still have a low interest rate environment, low energy costs and in the second half of the year i think we will get some earnings surprises. it will be one of those situations where it creeps up on people and before you know it we're trading 300 or 400 points higher in the s&p. >> rick, where do you stand on the relationship between energy prices and equity point? again, we say energy prices going higher can signal a stronger economy but it has lately been putting a crimp on equity prices. >> i have been having(xv8 a lot of discussions. i think the reason energy has become kind of a double-edged sword in a much larger way than it used to when we had lower energy prices is because if we're really honest the two biggest things affecting the u.s. economy in a positive fashion over the last handful of years in my opinion are things like the sequester and the energy part of the economy.

we can talk about ail the other issues, but i call those two areas collateral success. they weren't planned for. there was no policy really pushing them. the sequester was born out of inertia between the two parties and energy is -- >> wow. >> -- much of the political class for a while, but i think that's why we're making a big deal about it, because we don't have all cylinders available to us in this low productivity low growth environment. >> william dalttonton dalton -- the sequester has been a terrible piece of -- >> the president before the 2012 election took the pulpit and said we have a lowerh%ñ budget deficit, the economy is cooking, well, that's code for the sequester gave us the lower budget deficit and the energy market did a good chunk of the hiring and all the positives in the economy and they're taking bad but it because, of course

they want to bust one of the few things even though it was ugly that ended up being a good thing. >> think about the ancillary effects of what's going to happen with low energy around the world. think of what's happening in india, in china. remember, it's going to take a few months, but once it starts to kick in you're going to see a reignition of this global growth story which by the way drives the stock market, not our u.s. economy and that's one of the reasons why you want to be buying dips. >> so you think demand will pick up? a big part -- >> without question. >> -- of the decline in energy has been a decline in demand as well. >> without question, bill. absolutely. i look for demand to pick up not only abroad but domestically, too, but look specifically at india. look specifically at china, and look what happens with low energy costs in those two economies. i think we will be pleasantly surprised before the year is out.

>> and drawing everybody's attention to the fact that the u.s. 10-year note yielding below 2%. interest rates at this point, discussing with people who think they're going negative next year partly because the size of our financial markets has dwarfed the size of the economy. there's so much money pouring into the instruments. what do you think is going to happen with yields here? >> i think yields are going to stay low. i wouldn't be surprised to see yields go lower especially in the longer end, the 10 to 30-year part of the curve. i think there's a tremendous demand for income security and so i think it will be very, very long before we see any mercurial move in interest rates. again, when we do i think it will actually be good because it will say that financial conditions are allowing bank lending. right now more of the same, making equities pretty attractive long term but not short term. >> thank you, folks. appreciate it very much. i assume you meant european yields may go negative? >> no, yields right here in the

u.s. >> could go negative? >> there's not enough safe assets if you want to put it that way. the u.s. budget to rick's point is narrowing, the deficit is narrowing so much -- watch the treasury. see if they ultimately try to issue more even on the short end to put more out there to avoid the very fa none phenomenon of less issuance. >> if the economy continues to slow. >> or if it picks up if it's fundamentally not about what is -- >> janet yellen already has a head of gray hair and we have a dow up 219 points this hour. heading into the close just more than 45 minutes to go. look at the nasdaq giving up 45 minutes. the s&p is down 1% bolstered by kraft's performance on the back of that huge deal. >> that nasdaq sell-off is big now. we'll get into what's behind the biotech carnage today. our meg terrell checks the pain

points plus the pros will be weighing in on what you should be doing. maybe is it time to buy the biotech dip or not? >> and up next is it apple pay or apple pray? one analyst claims as much as 6% of apple pay transactions is done using stolen credit cards. is it that high? we'll get both sides when we come back. we come back. hello. i am here to offer sophisticated investing strategies. my technology can help you choose the right portfolio. monitor it. and automatically rebalance it. all without charging advisory fees, account service fees or commissions. that may be hard to compute. but i'm a computer. so trust me. it computes.

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big moves today. the dow down 221 points here. look at the nasdaq. down almost 100 points, almost a 2% decline. biotech a big part of that. transportation stocks also down sharply as oil has been up almost 4% for much of this day. so you're seeing a lot of big moves. of the ten sectors in the s&p 500, energy by far leading the way with almost -- it's about a 1.75% gain. >> it's not often tech is the laggard but it's down more than 2% today. >> we have breaking news on facebook right now. julia boorstin has details for us. what do you have julia? >> thanks so much. i just spoke with mark zuckerberg at facebook's developer conference and i talked to mark a little bit about what his vision is for

facebook for the next five years. he said that this developer's conference is all about showing how much facebook has accomplished in building out its portfolio of apps, it's family of apps far beyond the social network itself and about how much more they want to do to make each one of those app experiences like facebook messenger so much richer. he says he sees two major trends going on across facebook businesses. one of which is the fact that people are sharing more frequently and they want to share in more different ways, and so they're providing them with all of these different apps to do so. the second of which is that they want to share richer experiences, experiences like oculus virtual reality and like these circular videos which he showcased on stage. i spoke to him just moments after he was playing around with some of the oculus head sets here in f8. he said he thinks they're really just at the very beginning of building out this portfolio of apps for facebook for its users.

obviously whatsapp is here, messenmess n messen messenger. it's about making each experience much richer. a lot of optimism about what's in store for facebook over the next five years from mark zuckerberg who i spoke to here at the developer conference. >> julia boorstin with some facebook news. really appreciate it. dominic chu keeping an eye on some of the big movers in this market. >> a lot of them to the downside including what's happening with the apollo education tanking after offering disappointing sales projections. it's all about shrinking student numbers at these for-profit colleges. the university of phoenix operation saw a 13% drop in new enrollments. as a result shares down by 28%. then shares of wood flooring retailer lumber liquidators. you can see they are higher by 15%. the consumer products safety commission says it is

investigating those claims that certain chinese-made products sold by the company contain some potentially harmful levels of cancer-causing chemicals. again, but those particular studies says commission chief elliott kay could take months to complete, so those shares up by about 15%. and then keep an eye on shares of citizens financial group. this is is a rhode island based bank. its majority owned by rb s. rbs is going to be selling another large chunk of its holdings of this company after the bell today. 115 million shares will be sold with the offering price to be set tonight. that will bring rbs' ownership below the 50% level for citizens financial. it's aiming to divest of its full stake by the year 2016, bill. back over to you guys. >> thank you very much. now, you use apple pay right? >> actually it's funny this comes up. usually i'm a laggard in all of this technology -- >> not an early adopter. but this time you were. >> but i finally got the iphone 6, set up the apple pay entered

i didn't mean to use it but trying to buy some pillows at macy's, the easiest thing was to swipe it and it was simple and i have been using it since then. >> our next guest says as many as 6% of apple pay transactions were made with stolen credit cards, meaning someone with the apple pay app took someone else's credit card information and put it into their phone and then went shopping. >> so it's too easy basically. >> well, there are two different parts to this whole story here. first we reached out to apple and they provided us with this statement on that. apple pay they said, is designed to be extremely secure and protect a user's personal information. during setup apple pay requires banks to verify each and every card and then the bank then determines and approves whether a card can be added to apple pay. bank bank, goes on to say, are always

reviewing and improving their approval process which varies by bank. >> it's not our fault, in other words. joining us right now to dig into this story is terian abraham and mat trick moorhead. no one is asking you to blame somebody here, but why don't we? is this apple's fault or the bank's fault do you think? >> well, let me back up a bit. the first few weeks after apple pay had launch eded, we started hearing that high levels of fraud within apple pay shared with us by a if you issuers and it shouldn't be surprising because the first unchosen default demographic for every new payment system is the fraudster, and the unofficial use case is fraud. and so it should not be surprising that we did see high levels of fraud for apple pay in

the first few and i think it is getting better. so to you kelly you should not hesitate to use apple pay because it is inherently secure. >> cherrian, it sounds like the issue isn't me, it's more the retailer. should they be looking at me with a raised eyebrow if i approach with apple pay? >> i doubt when they look at you they see a fraudster but you did touch upon something that is with a phone, with somebody who is affluent and having a contact list payment system such as apple pay looks like an affluent customer and not like a fraudster. so the root of the fraud within apple pay is identity fraud and identity fraud has led to and is a major facilitator for a variety of fraud and not just within apple pay. >> patrick the process itself of apple pay is designed to be, you know -- i don't want to say

hack-proof, but it's more difficult to hack when you're using apple pay. however, it's that initial process of entering your credit card information that seems to be the weak link here, and you have to go bank by bank to figure out who is doing a better job of the approval process on that, right? >> so i think we need to bring some common sense to this discussion because none of this stuff adds up. so, first of all apple doesn't authorize credit cards. the issuers and the banks do. also, i find it funny that there's no bank on the record talking about any issues that are out there and if this were truly rampant fraud don't you think that consumer would be up in arms about this? the fact is they aren't, and this doesn't add up. in fact, i talked to one of the world's largest credit card issuers who, these are his words, not mine, considered it preposterous and the numbers lack total reality of what he is

seeing and his -- >> so you don't think that cherian's report is factual? >> i think this is a case of a few banks who weren't prepared for this, that are trying to maybe play cya. it's not apple, again who is validating these. these are the banks who are validating this. and, for instance, when i did it, i called bank of america. other people might have to get an e-mail where they put in a validation foror a pin code, but this is not an issue it's not widespread, and it's not rampant rampant. >> one of the knocks was maybe apple rushed this to market too soon, they didn't think it through completely and banks were caught off guard in some cases in the whole application process, but you seem to suggest that maybe they're getting caught up on all this now. >> so it is not portion blame just on the banks

themselves because they did not have enough time in terms of setting up the apparatus to on board customers more efficiently than having consumer call into a call center. as we all know, the fraudster is better at social engineering than the call center employee is at sniffing out fraud. and i think it was previously mentioned that is apple pay too simple and, therefore is that a predicate or a fraud? and i don't agree with that because simplicity should be inhasht in the system that is we use and that should not -- >> and we know that's what's driven adoption. great discussion. thanks very much. look at this with the dow -- >> i will point out that blackberries are very secure in how they -- >> can you use them to pay -- >> no, you cannot. no. >> when you're juggling pillows at checkout? >> let's move on. >> that's the nasdaq up 101. >> a full 2% decline now.

biotech is a big part of that now. the industrial average as we pointed out at the session lows down 246 points. same thing on the s&p down 24.5. >> watching it closely 35 minutes to go. bio biotechs are ledading markets lower. meg terrell will tell us what's going on and a pair of investors tell us where there might be a buying opportunity. stay tuned. can data help cure a disease? the right treatment for you is out there. the problem is some of it's in this lab. some of it is in her head. some of it's in this new journal. and the rest of it is in your personal medical history. ibm watson can not only read this data, but understand it. it's trained by doctors. and it's always learning. it can help find hidden correlations and help your doctor recommend treatment options for you.

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welcome back. sitting at the lows of the

session. the dow off 252 points. the s&p down 25 points. the nasdaq down 105. declines anywhere from more than 2% on the nasdaq to 1.4% on the dow. here is the nasdaq 10 heat map. only four names in the green, first two include kraft jumping 30%. >> mondelez as well in sympathy. special situations there. but the biotechs are the sickly ones today. meg is here to tell us what the problem is. meg? >> that's right. a lot of folks are saying this is just some normal profit taking at the end of the quarter seeing this pain in biotech today. really only a couple names in the entire nasdaq biotech in the green. gilead amgen, celgene, and biogen. biogen 4.5%. the smaller ones are really really harder hit. looking at some of them all down almost double digits.

the rest above 10%. clearly a lot of pain going on. it's been a tough week for biee tech biotech in general. it's been a losing streak for three weeks. it's causing a lot of jitters about whether the biotech run up 280% in the last five years could be ending. a lot of disagreements about that, but clearly a lot of fears today. back to you guys. >> all right, meg, thank you very much. let's talk more about this sell-off in biotech specifically right now. >> joining us now is les and barbara ryan. barbara, do you look at this space and sense opportunity or is it still looking pretty risky? >> i mean, i think you have to look at this selectively. i think meg pointed out the great performance of the sector and i think it's important to note that this is really being driven by fundamentals. number one, strong topline, bottom line growth. a lot of capital going into the space. by the same token, everything

has gone up in the sector and i think investors are going to have to be a lot more selective. you look at merck and pfizer they're flat on the day and still outperformed. >> we know biotechs are volatile. there's a lot of hit and miss that goes on in this industry. so they're up as sharply as they have been recently it stands to reason laws of physics would suggest they're going to go down just as volatilely right? >> i would argue that stocks don't -- laws of physics don't apply to stackocks. biotech is a sentiment driven sector and we keep hearing talk about biotech bubbles. certainly that's going to dissuade people from investing, so you are going to see some concern on the part of buyers. we are looking at these sell-offs as times to put capital to work. although like barbara said selectively, not groupwise because certainly there are some that are going to wind up being

failures. >> barbara, people will say look at the charts of just the price action, the biotechs, this has been making the rounds on the streets all week versus the dotcoms in their heyday. it's almost parabolic. >> absolutely. and it's true. you have to always be selective. right now we've had a market that's been indiscriminate and we have a lot of companies that are many many years away from the market and it's sentiment driven. this dialogue about is it a bubble, are rates going up which is another factor that will obviously drive performance in the stocks and everybody wonders, i don't want to be the last one out so it becomes self perpetuating. >> dollar strength does not help as well. >> i think for the biotech that's not really as big a deal. i think certainly the psychological impact of rates going up because, remember a lot of what's driven pe expansion in the sector is the market is willing to pay a lot for growth because we have low interest rates and slow growth. that changes, that changes the

valuation of the sector. >> well put. >> we got to go gang. we have to move along with the sell-off intensifying. good to see you both. >> thanks a lot. >> bye, les. >> dow is down 254 points. the nasdaq is down 2%. let's get to a cnbc news update with sue herera. the army sergeant who abandoned his post in afghanistan and was held by the taliban for five years will be court-martialed on charges of desertion desertion. the state department confirms there was a third american on the germanwings jet that crashed into the french alps. investigators have extracted the cockpit voice recordings from one of the black boxes from the plane and expect to have a read out of its contents within days. japan's maritime self-defense force unveiled its largest helicopter carrying vessel to date. it is to play an active role in patrolling japanese waters for submarines. and new research finds

obesity increases the risk of liver cancer while drinking coffee may help protect against the disease. liver cancer now becomes the tenth type of cancer to be linked with obesity. and that is your cnbc news update at this hour. back to you guys. >> that will do it. thank you, sue. 30 minutes to go. >> yes ma'am. and the selling continues. down 262 points now on the industrial average. a decline of almost 1.5% but it is the nasdaq getting a lot of the attention because it's now comfortably down more than 2%. i getion comfortably is not the right word but we're down 108 points on the nasdaq composite. >> we'll get reaction to this volatile market from the head of the cme group. terry duffy joining us in just minutes. lots to discuss, including the nasdaq muscling in on his turf to some extent. don't miss it when we come right back. (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.

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welcome back. we are in sell-off mode right now if you're just joining us. the selling has intensified as we go into the final hour of trade with the dow down 253 points. the nasdaq getting hit the hardest down 2.1%. biotechs we have already established leading that move down. oil prices have been sharply higher today, so oil sensitive

stocks are going lower like the transportation. we'll talk about that later. this is all 500 components of stocks in the s&p 500 index. very few of them in the green today. food would be among the gainers today with that merger of heinz and kraft. but otherwise you got minus signs across the board. >> cme group chairman terry duffy appearing before the u.s. house agricultural committee. >> terry joins us now in this first on cnbc interview. i know you have been sequestered in d.c. today, but i have to get your thoughts on the market action. once a trader always a trader. you're always following the markets there, terry. the selling is intensifying here. we're getting more volatility as expectations for a slowdown in the economy picks up a little bit here don't you think? >> well bill and kelly first of all, thanks for having me. >> good to see you. >> welcome. >> thank you, and i appreciate that. i have been following the market even during the hearing because i always get -- i just can't

help myself, i have to follow it. >> right, right. >> when you look at the ebbs and flows of the markets from these levels, it doesn't surprise me when we have 1% or 2% moves up or down when you're at extremes so with interest rates being at extreme lows you have sell-offs in the marketplaces you're going to have quick, hard moves. it always happens on extremes. so this doesn't surprise me. but at the same time it's always concerning when you see a move like this happen so quickly. >> where are you seeing volumes pick up the most lately terry? does it have to do with some of the dollar and euro moves we have seen out there, is it commodities, interest rates generally? what are you seeing? >> i think it's going to be all interest rates kelly. i think that's where the future is going to be at. the training bhels havewheels have been off for the fed since last october. they're changing language around. when are they going to make the first move? are they going to make a secondary move? what's going to happen? these are all thins that need to take place over the next several months and there's a lot of uncertainty around the marketplace, and when you have

that uncertainty you get these offshoots in the equity markets like we're seeing today. that's where i think all the action will be. it will be based around rates. >> you're in d.c. to lobby for the reauthorization of the cftc. are you worried europe pen regulators will get a step on the u.s.? >> i am a little concerned about what's going on with the reauthorization not so much in the process, kelly, but with the equivalence of u.s. exchanges being recognized in the european union. they're recognizing smaller countries around the world but not the u.s. that has the same standards and a country of our size not being recognized in europe is a joke. we've been going through this process for two years. i'm raising it more in congress today. it has to come to a stop. we have to get the equivalence issue behind you see. it's no difference than interest rates or any other part of the market. we need to eliminate uncertainties so participants know the rules of the road. that's what i'm trying to accomplish.

>> you're facing competition from the likes of nasdaq. they're going to trade their own futures. bob greifeld say what you do at cme and what they do at the intercontinental exchange is monopolistic. do you welcome the competition or what do you say? >> i say to bob i welcome the competition. it's not mon nop elastic. the markets are open to everybody. you can't just do a me too, strategy. that does nothing for a capital intense tiffive marketplace. what is your value add that you're going to have by listing these products? i don't believe he has any right now. we have so many different things that we can do by cross margining our asset classes and saving customers tremendous amounts of money in a very capital intensive world we live in. >> how much of this is also to some degree regulatory confusion, even barney frank admits one of his regrets about the creation of dodd/frank is that they left the regulatory environment too complex. there are too many regulators

overseeing too many markets. they should have solidified it a little more. what do you think about that? >> i'll go back to around 2003-2004 when we had -- that took years in order to get to the next level. i think we're seeing the same thing with dodd/frank. dodd/frank, you can never vote out 2300 pages of legislation and have all the answers in a week, so it doesn't surprise me that we're going to go through some ebbs and flows as it relates to dodd/frank. >> terry, always good to see you. appreciate it. >> thank you, bill. thanks kelly. >> terry duffy, busy day for him. >> minus signs keep getting bigger. the dow is now down 261 points. decline of almost 1.5%. the nasdaq continues lower down more than 2.1% right now or 108 points. >> we've got much more on this special market sell-off coverage when we come right back. stay with us on "closing bell."

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so trust me. it computes. say hello at intelligent.schwab.com welcome back. relentless selling pressure in the close. we started hour with the dow off 200 points. now we're down 269. 1.5% decline. the nasdaq sell-off picking up as well. that's the kind of number you'd

expect out of the dow on a normal day, down 111 points only three names now in the green as mentioned, kraft and mondelez. >> bertha coombs is covering today's action. just a couple days ago we were looking at 5,000. that's off the table completely right now. >> yeah difficult to get anywhere near 5,000 when the chips are down and they are down sharply today. semi-conductor index is off about 4.5% at this hour. we're hitting the lows of the session, and you're just seeing some of the big names. the interesting thing is the semi-conductor index goes into the red for the year fractionally here. it hasn't really been the leaders, but this is one of the areas that's a source of pain when people want to sell. the big caps are also dragging things down as well. apple is a 15-point drag to the downside getting very close to its 50-day moving average. this is a stock that struggled after hitting an all-time high back in february. bucking the trend though it seems as though we're see agroing

a seems as though we're see agroing a rotation out of the big names into small cap energy stocks which are down 5% for the year sectorwise but today they're getting a bid. >> thank you very much bertha coombs over at the nasdaq for us. keeping an eye on the transports, one of the big losers today. led by the airlines. >> dominic chu tell us about that and what else is going on there. >> the stock market overall, guys, is down but take a look at what's happening with oil prices. oil prices you can see are soaring. they're up by 3%. now we're off our best levels of trading so far today but still a nice move higher. crude oil near $49 a barrel. that has this inverse relationship with transportation stocks specifically airlines who use fuel derived from oil. so again you can see delta air lines, american continental, jetblue, all of them having heavy downside days. airlines taking the rest of the transportation sector down. if you take a look at a year-to-date or even a one-year chart of the transportation the dow jones transportation index, you can see here this idea that we're bumping along and hitting

some resistance here. the worries that these transportation stocks may have a leg lower and what is that going to say about the rest of the overall stock market. they're not confirming the record highs we're seeing in the dow and the s&p. that's going to be a cause that traders will say is a concern at least going forward, so again transportation stocks, airlines very much a focus for a lot of theorists if you will out there. >> dominic chu, thank you, sir. this is as the dow approaching a 300-point sell-off. down 280 points at the moment. similar declines across the nasdaq and s&p. >> art cashin needed two hands to signal this one. the bias is to the sell side $900 million to the sell side is the imbalance as we head toward the close here. so we are knee-deep in red arrows. find out if stocks can stem the bleeding in the final minutes of trade. we'll be back in a moment.

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heading to the close, we got 8:30 left and the selling continues to intensify. the dow now down 281 points. more than a 1.5% decline. s&p down 29. the nasdaq getting hit the

hardest down 2.33% or 116 points. biotechs leading the way. there are plenty of groups being sold off. >> you were saying you love these kind of days but should all investors be similarly excited to take advantage of these dieclines? >> your ma and pa investors probably aren't too excited but these are natural gyrations. the pullback is natural. three days down due for a day up. it's time to jump in. >> is this seasonal? for some reason the spring is usually a time when they start selling the market. sell in may go away nonsense. we're at a point we're going to get earnings that may have been hurt by the stronger dollar. oil prices are starting to rear up again. all these reasons to build this wall of worry. does any of that resonate with you or you just want to get back into the market when we get to a lower price point? >> there's a lot of headwinds

but at the end of the day the market is solid. the dow has hovered around 18,000 for quite some time. look at the head winds we've had abroad and here. we continue to stay intact. we're bullish on u.s. companies but even on the multinationals, you go with nike or alibaba, you have good trades there that will do well with the dollar headwind. so i think the consumer is finally going to be empowered this summer with the lower gas and higher dollar. >> so what sectors do you like and what are you staying away from? >> well the health sector has been on a great run, and we think that will continue. >> biotech or no? >> biotech is part of the health care. you're seeing bristol mi-myers came out with a drug. when you look at some of the retail health care as it relates to the medic clinics and some of the retail pharmacies that's a real god send for people so they

don't have to go to the emergency room and spend $400 or $500. >> what are you going to avoid then? >> energy? >> i tell what you, emerging markets. anything outside of the u.s., unless it's a u.s. domicile that's a multinational. again, nike coca-cola, multinationals. now, we do like alibaba. i think that's very undervalued and it will do well. >> matt good to see you. appreciate your thoughts. a voice of reason perhaps. >> right, right. >> as the sell-off continues. >> and he's had mac and cheese and ketchup. >> it's just fine. >> we're taking an unofficial poll about that on this merger day for kraft and heinz. down 286 points though. we'll come down with a closing kount countdown. >> you're watching cnbc, first in business worldwide.

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about three minutes left of the countdown. let's show you a quick review of the some of the major averages today. here is the dow. the selling really started to pick up around 11:30 eastern time today and we've just been meandering lower since then. we're just off the lows down 276 points. art cashin pointing out we're getting back to the lows we saw after the fed meeting of last wednesday. let me show you the nasdaq as well. that's been harder hit. the dow is down 1.5% but the nasdaq is down 2.25% with a decline of 113 points. biotech a big part of that

decline. what else has been causing a sell-off in equities today, the price of oil. the wti is up 3% right now. it was up 4% earlier, but we were approaching $50, bumped up against that pulled back a little bit. still a gain of $1.47 right now and trgesansportation stocks are down as a result. also a sloppy 5-year note auction today, and that took a toll on tom of thesome of the interest rates. the yield up 3.5 basis points and the 30-year were bumping off low that is were set yesterday at this time as well. bob pisani plenty of other things moving as well. >> it's a little bit of a confusing day because there's no obvious catalyst for the decline. buying yields were up at the market opened but the stock market didn't start drooping until the middle of the day. i think we're approaching the end of the quarter. the biggest gainers, what were they? biotech that we saw. we saw solar stocks and

semi-conductor stocks, and if you take a look at them those are the biggest decliners today. they're selling the names with the biggest moves to the upside. >> here you are. >> the other way to look at it the sector that is had the biggest declines are the oil service names and euro and steel stocks. they're the ones that were up today. i'm not trying to blame this all on people messing around with their book a little bit, but we're approaching the end of the quarter. you tend to sell some of the winners and buy some of the losers at this point. other than that, i think we've got to keep an eye on the bond yield that's been moving up. we're in a trading range on the s&p 500 right in the middle of the trading range for the year right in the middle of the trading range for bond yields for the year and oil. oil is between $45, $55, we're at $49. so right now we are right in the middle of the trading range here and nothing is particularly breaking out. by the way, the volume only average today. heavy volumes in the semis. >> i will say i'm noticing a

quicker step on the part of some of the traders as we head toward the floor. thanks very much. we are going out near the lows down 287 points on the dow, and the nasdaq down more than 2.25%. stay tuned. much more coming down on the second hour of "the closing bell" with kelly evans and company. i'll see you tomorrow, kel. thank you, bill. welcome to "the closing bell," everybody. what a day it has been. i'm kelly evans, and take a look at how we're finishing up the session. the dow jones industrial average going out with a decline of almost 300 points off 291. more than 500 points below the recent all-time high recorded earlier this month. the s&p has declined 30 points and look at the nasdaq down 118 points or almost 2.4%. 4876 is the level there as it retreats further from 5,000. buying or selling opportunity? let's bring in today's panel.

cnbc contributor carol roth is here with cnbc senior contribute larry kudlow. welcome to you both. joining us for more on today's market action we have doug sandler from riverfront investment group guy adami, ben willis from princeton securities and our own dominic chu. guy, what's going on? what do you make of this market? >> well, everybody wants toa bull pac -- pull back until they get one. it's what we've been seeing all along. you have the stair step move to the upside violent moves to the downside. every move of this magnitude over the last couple years has proven to be a huge opportunity. my sense is this will be the same. with that said take a look at the transports the iwt. that had trouble at 168 or so for the last three, four months and we're starting to break down. that concerns me. i think we're okay as long as the russell stays above sort of 121, 122, but if those start to break down then maybe, then

maybe the s&p tests levels we last saw maybe six or seven months ago. >> carol? >> yeah. i wonder how wise the investors have perhaps become to what's going on with the consumer, and when i look at yields even though today they may have been up a little bit if you think about who is buying bonds, a lot of those are the financial companies which means that the banks are buying treasuries instead of lending to consumer. if they're not lending to consumer, the consumers aren't spending which means companies aren't increasing their revenues which means we'll have sluggish growth in the economy. i'd like to put that back to guy adami. do you think investors are wising up and realizing maybe the foundation that everybody has been saying so strong is perhaps a little bit cracked? >> you know it's funny. carol makes a great point. we have this keynesian fed and they don't want people to save money. save stion a bad thing.

larry, you can speak to this. we have been taught since i was a little kid you have to save, save save save yet the fed is doing everything in their power to get us not to save. to your point, carol, i think people do want to save. i don't think people want to be forced to spend, but everything that's going on right now with the fed is forcing people to do exactly the thing that they're taught not to do growing up. >> i want to echo one of the things guy said earlier about transportation. this was a point that jimmy cramer has been making too. transportation is providing very weak leadership and, in fact i think it's about five percentage points below its highs made last autumn. comet is slowing down a lot of it slowing down. profits are in a mini slump. costs are rising a little faster than prices, productivity is declining. stocks are so sensitive to profits it's unbelievable. >> are they though? >> yes. profits is the mother's milk of stocks. who said that?

>> a very wise man has told me that over the years, larry. if i may suggest though that there's something else going on here, it's a lot of flows. you have to look at what's happening in the credit markets. people are basically -- look at what happened -- i was just reading this one, council energy. there's so much money pouring into credit markets, it's allowing companies to do buybacks supporting massive dividends, all of it is great -- >> stocks are cheap, come on. >> it's not necessarily earnings. >> it is earnings -- >> on a forward earnings basis -- i don't agree. there's nothing you said there that contradicts the earnings hypothesis. you still have to do your credit work on the high yield bonds. let me just add this one little positive note okay? take a look at your charts everybody. c and i loans are exploding -- >> commercial and industrial. >> -- last three months.

m2 is moving up along with it. >> money supply. >> so i don't think the economy is dead. i think we're in a winter lull. we're in a profits lull. i get that. i love to see a 5% or 6% or 7% correction, but other than that, buy the dip. >> doug, are you buying the dip or selling them? >> i believe we're with guy and larry which we are in the fifth or sixth inning in the bull market. i'm not as worried about the transports. transports, a lot of their profitability and revenue growth has been driven by trucking crude or railing crude out of the oil patch, so i think the rails have been weak -- sproo shouldn't they be up on a day like this if roil is rebounding? >> you're not going to see the volumes that quickly, but my view is the transports are probably sending a little different sign than what would be normal in a normal economy. i also think banks are lending. so loan growth is occurring right now. you're actually seeing the fed 31 of 31 banks passed the stress test which means banks don't need to continue to build up

reserves like they have for the past five years. we've been buying consumer stocks. >> just want to bring ben willis into the conversation fresh off the floor, ben. what's with all the selling pressure into the close there? what do you make of it? >> i think tomorrow you'll wake up and wish you had bought the close is the short version. what i believe what we saw happen first there was a break in the transports. then we saw a break in the semiconductors, and i believe this is all you'll find out when the research team on cnbc does their work, they're going to find out that this was etf driven. you saw major pressure in those group of etfs which speaks to profit taking. the question is where that money went to today while the rest of the market was under pressure. but the fact of the matter is this is an okay correction. we were lulled to sleep in february in terms of volatility. this was very normal if you remember back in january. moves like this were easy to digest, and if you bought the dips it paid off very handsomely. that has not broken. we did not break the march lows on today in the s&p.

i think that's a good indicator, but, again, going into today, we were blaming some of the economic numbers earlier when we were starting to break. that didn't hold up. we were on the plus side when this market first opened. we saw dramatic selling pressure in the stocks and in transportation and i think that's really what drove this market and tomorrow that's probably going to reverse. >> dominic chu, do you want to weigh in here? >> the interesting part is we've been speaking about the idea there might be a rotation going on. there was at least for the short term some buying in these beaten down energy stocks. that was a real stand out in today's trade. yes, withe know oil prices were up. still, it gave a little bit of that volatility back on the upside to oil stocks. if you look at some of the top performers today you're talking about names like noble corporation, ne transocean. these are some of the most beaten down energy stocks. whether those uptrends continue short term to medium term that remains to be seen. obviously a lot of people out

there think their oil prices could be due for another leg lower. when you're talking about the idea that for the first quarter there's been stand out trades ben willis he recognized the semi-conductor trade, right? if you look at some of the worst performers in semiconductors today, they were the ones with the steepest climbs higher over the course of the past year and so profit taking is part of the picture. you just wonder whether or not it's the beginning of something greater. >> carol? >> i go back to the question around commercial lending and what those companies are doing with that money, and as larry said, yes, the buybacks do add to earnings but at some point we need to make capital investments as well. if you are looking for the trade, one of the things again in the lending story you're going to look at is sommer injuries and acquisitions. you want to look at names that could be potential buyout candidates. that is going to be one of the big drivers of the market if it continues to go up. certainly it's not the companies investing to grow revenues. >> i want to talk m&a but we'll get to that later. i don't like m&a, by the way.

it's a market and i respect all markets. i don't think it does darn good for the american economy. i do want to make this point. i think you agree with it. capital goods, the capital goods report this morning was awful. capital goods have been the weakest part of this economy now for six years. in fact, we are barely higher than the last cyclical peak in early 2008. businesses would rather keep their money overseas for tax reasons where they don't want to bring it home for longer term five, six, seven-year investments and that's showing up in the numbers. you know what? the last three years we've hardly had any capital goods investment. you want to look for a villain in the economy, right there. long term what alan greenspan called long lived assets. >> sountzds like what carol has been saying. >> what i have been say overing over and over again. >> that's one reason why wages are low. >> if everybody can agree we need to structure, you know, this system so that it rewards

people for making these investments, anybody have some ideas? >> pull up cut the corporate tax. cut the corporate tax from 40% to 20%. >> doug sandler -- >> let the earnings come home. >> i want to throw one thing in -- >> we like you, say to the companies we like business. unfortunately, this administration doesn't like business. >> doug? >> just a quick thought here is the u.s. investor has been spoiled the last five years and i think one thing you got to open your eyes to is that the international markets, they're in the early stages of where the u.s. was five years ago, so i think the fact that the u.s. is not the only game in town the investor can now take money and put it overseas and make money makes the u.s. as we start to bump into some area where is we're wondering about growth investors have an easy choice. take their money out of the u.s. and put it overseas. >> that's a great point. did you see yesterday's "ft" front page?

the pmi for europe the market pmi for europe was very strong. much stronger than anybody expected, and i believe this is the third straight month. so, ben, i think you make a great point. >> ben willis you just told us i think we'll look back and have said this is a buying opportunity. what tells you in the morning if you have to change your mind? >> probably the futures market and getting the indications on the opening of the floor of the nox where the imbalances are how the foreign markets reacted to what's going on. again, i believe you'll really need to keep an eye on the etf market and the cnbc team i'm sure can go into those pits and find out exactly where the sentiment is. i think it will be one of the great unwind trades we've seen over a period where money is taken off the table. the high velocity money has come off. you saw the big names stocks like tesla all taking it on the chin. those are stations this is a ba that trade. that is not an investment trade. >> last word to you dominic chu. >> what we'll be watch something

what happens with technology. we want to see whether or not there's a bleed out to any other parts that are noticeable to the downside. the reason why we all care about technology so much is that the s&p 500 is 1/5 of the overall market value is those tech shares. some people look to transports as an indicator. other people look to financials but tech knowledge has the mostnogeknowledge -- technology has the most heft. >> this is such an important point that dominick is making. it's another point that jim cramer is making. jimmy said the three areas you have to watch out for for lousy leadership transportation banks, and certain parts of tech. tech could be in weak hands and we nont know until we see the price action but it could be in weak hands. again, corrections are fine. corrections are great. bring down the multiples. that's called free market capitalism. >> guy when we start talking

about those areas that larry just mentioned, what if there's a rotation under way? what could emerge as the new leaders, if you will for this market to power forward for the next couple months? i'm thinking of the home builders, a group like that. >> look at the move they've had though kel. look at the move in home depot over the last couple years. you've had leadership there very quietly. let me end on this note because i know this block is heavy as can be. we should have a fed -- u.s. public should demand a fed stress test because they would fail miserably. allow corporate darwinism to take over. take them out of the equation. they're levered 80 to 1. >> amen. >> guy, you are so right. >> amen, guy. i'm worried everybody agrees on this point. we'll leave it right there. thanks guy adami. thanks to doug sandler as well, ben willis and dominic chu at

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welcome back. more on today's market sell-off. let's get right to our cnbc all-star floor show. joining me now bob pisani rick santelli out at the cme, bertha coombs at the nasdaq and morgan brennan on the transports that took it on the chin. bertha a 2% decline on the nasdaq. was it the biotech names? >> it was the biotechs but the chips are more concerning when you look at them technically. the philadelphia semi-conductor index falling below its 50-day average. that was a decisive sell-off. it's nowfractionally in the red for the year. the semis overall have not been the leaders. so it's very similar to what we

saw last october, and it's the same sort of movement we saw when we saw both the chips and the biotechs telling off together and really hard last october. so if this continues, this technical weakness for the chips, it could start leading other things lower, too. >> also on people's worry list if you will, morgan, was the move in the transports which have been real weak lately. you heard doug last segment telling us maybe that's because they move a lot of oil. is this a classic sell song? >> take a look at the transports. the dow transports are down 4% so they're vastly underperforming the other indices. the issue here obviously you had higher oil. that's going to weigh on the transports. you can also talk about profit taking, but there are some broader, longer term trends playing out here as well. the first is the fact you have seen a number a steady march of these companies coming out with disappointing earnings and/or forecasts. a few examples fed ex tightening guidance kansas city southern this week warning full-year profits won't be as

high as originally anticipated. on top of that, we've had data, we've had readings that show that freight volumes are slowing down. you see it with trucking. numbers yesterday showing truck tonnage slowed down in february from january. that's really worrisome and. weekly rail numbers, the traffic for rails have been disappointing and they have been led by crude. also coal also the fact you're seeing a slowdown in the movement of things like frac sand and metal pipe used in drilling. all of those things have folks worried because it's an early indicator that the transports, if you see a slowdown in the transports, it means there's a slowdown in u.s. economic growth coming as well. that's why people are skittish as well. >> rick santelli, should john kasich run for president. >> i have no idea. >> larry kudlow is going to find out tonight. >> wait a second. our group, the committee to unleash prosperity steve forbes

and steve moore and i, kasich is coming. 40 people are going to cross-examine him. rick santelli the founder of the tea party, what question should i ask governor kasich and i will credit you? >> ask him can we get rid of all the regulations and go back to basics? failure is the best regulation instead of all these dodd/franks, just margin products, okay? we can get rid of most of the red tape and maybe the biggest issue is listen they talk about climate change and trying to control mother nature and they can't balance a budget, they can't do corporate tax reform. come on. let's get down to the things that everybody needs to do. >> rick -- >> now, as far as the markets -- >> let's get back to the markets. >> you started this. >> i did. i had to. i couldn't resist. go ahead, rick. >> last segment jack brought up some great points last segment. the fact we're getting so close to quarter end given t3 in terms

of settlement on stocks but he got right up to the water and znd bring up the other huge point. march is also the end of the fiscal year in japan which runs from april to march, and i think that's a biggie as well and keep this in mind you now have the s&p and the dow virtually unchanged on the year. off 10-year note yield down 25 basis points from where it settled last year. so in my opinion i don't see anything surprising when i look up at the screens. the entire world's economies are calibrated on the cost of capital and we're rejiggering what that cost of capital will be in the form of normalization. if you think this roller coaster is going to stop anytime soon i think you're going to be surprised. >> bob pisani, bring it home for us. does it all come back to the fed making this move on rates? >> it was a little disquieting because there wasn't an obvious catalyst for the decline. the most obvious was the bond yield moves we saw at the start of trading and then in the

middle of the day. i guess you can blame it on that. i see a little more end of the quarter rejiggering so when you saw, and bertha mentioned that semiconductors down big, biotech big movers on the quarter, down big. solar stocks down very big today. that looks more like a little bit of a rejiggering and then oil the worst performer, all those oil stocks had a great day. i think we have to see a little more, and we're in the middle of the trading range on everything s&p, 10-year yields oil, everything is right in the middle of the trading range. >> can i come in repeating, i have argued for months that the fed should work later not sooner, and they should do less not more. i want to underscore that as we look at these lousy economic numbers and there is no inflation. let me add, brian kelly, b.k. such a smart guy -- >> oh, come on. >> is that you, rick? >> come on do more of the same. six years isn't enough? come on!

we need new policy. >> all right, rick let me just finish my point. >> i will. >> because i don't see any overheating, because i see commodities and the dollar up and no inflation whatsoever if you have aggressive rate hikes by the fed, the risk is -- this is brian kelly's risk and he's got a good point, long-term rates could fall 10-year rates could fall. that could do damage to the financials and that -- >> we got to go but rick has the fire extinguisher out. >> yes. >> risks of an inverted yield curve could rise. >> this fire extinguisher erxpired in 2011. i don't think we have to spray it on the economy any time soon. >> they've stopped. >> they're not going to raise rates and they're not going to do it meaningfully anyway if they do so i don't think it's an issue. >> just go slow. all i'm saying is go slow. >> thanks everybody. thanks rick. an earnings recession, we've been discussing it.

sounds scary and would be if it happened. next, someone issuing a warning every investor needs to hear. what does today's sell-off mean for the outlook for mega mergers like the one we saw today between kraft and heinz. you might be surprised. we'll get into that when we come back. been discussing it. back.

♪ grind virtually any kind of food waste into an unending source of electrical power for a city? when emerson takes up the challenge it's never been done before simply becomes consider it solved. emerson. early projections for first quarter earnings don't paint a pretty profit picture and that has one firm issuing a stark warning. jeff cox has the details. >> if you want to talk about the

things troubling the market how about an earnings recession? that's what s&p capital iq's new numbers indicate. first quarter they are projecting for earnings on the s&p 500 to decline 2.9% that's expected to be followed by a decline the second quarter of 1.8%. now, for the full year they only now expect profits to grow about 0.3% just three months ago we were talking about nearly a 10% gain for earnings this year. now, this comes as we've seen a decided markdown in economic projections. the first quarter according to the atlanta fed possibly only 0.2% growth. cnbc has a tracker that's actually at 1.8% growth. now, as my friend larry kudlow is sitting near me and likes to say, earnings is the mother's milk of the stock market and if we don't have earnings what does that mean for stocks going forward? >> jeff raised the question. lindsey bell joins us as well.

an earnings recession, what are we talking about? two quarters in a row, just a decline year on year? what's the definition? >> typically it's two quarters in a row but the good news is though we have negative 3% for the first quarter, negative 2% just about for the second quarter, what is typical is that analysts are pretty bearish going into the quarter with their estimates and historically usually the companies beat by about 300 basis points. if we're lucky we'll get flat to minuscule growth. >> i'm wondering if it's already priced in. >> you know i think jeff is 100% right. terrific article you wrote this morning. i clipped it out even before i knew you were coming on. >> you're the best larry. >> profits are really important, and you may have two quarter decline. that doesn't necessarily mean a recession. you have to see a little longer trend line of earnings, but costs are rising and prices are falling. the strong dollar is going to make all costs go down and it's

going to empower consumers as well, but in the short run pricing is very difficult. so look at the cpi -- >> my only point is does that mean you sell the market because we're sitting this earnings near-term trough? >> i would keep listen to what lindsey and jeff are saying because you have to track profits. you could have gone in 2008 all right, and besides oil, besides the financial stuff, it was profits that started falling in the middle of 2007. very important leading indicator. >> i don't think there are a lot of investors in the market who are, frankly, surprised by this. i think there weren't a lot of catalysts going for growth. certainly there were some people trying to make the case there were these fantastic catalysts for growth but there were many of us saying we don't really see it, and i think with the interest rate environment we have, with the strength of the dollar, with everything that's going on internationally, i think investors will overlook that for some period of time. >> this is interesting. so in other words acknowledging that the earnings growth isn't really there for the variety of

reasons we've discussed, but it's not necessarily going to stop the stock market from rallying? >> it should in a normalcy, but we're not in normalcy here and i think with the fed intervention and everything going on with central banks around the world, i do not think that it stops it in the short-term. i think it creates longer term problems but i don't think that's the only catalyst to stop it. >> i think we could talk -- we can crunch numbers and talk about negative quarters. what's it going to feel like. what does it feel like to the average consumer out there? what does it feel like to the investor. i did another story about investor surveys. the association for individual investors survey at its most bearish level in two years. normally that would indicate a contrarian buy sign. it would be normally a contrarian buy sign. however, the last time we hit this level, the market actually it was two years ago dropped off about 7.5% after that. so you look at durables number today, low demand. you look at the income numbers, we had negative income growth in

february. a lot of headwinds out there for a market that hasn't taken a break in four years. >> contrary point. i agree with the analysis and the principle just a contrary point. the strong dollar lowers production costs for all american companies. very important. outside of energy. meanwhile meanwhile, the strong dollar lowers prices for consumers and consumer incomes in real terms are rising. so i think that's going to bail us out of the profits recession. >> and that's why, lindsey, i know the energy numbers are terrible year on year but where else are we seeing these declines? where else are we seeing earnings poised to decline? >> for 2015 it's just energy but in the first quarter you're seeing five sectors seeing earnings decline. you have materials, you have utilities, telecom and even consumer staples that will see declines in the first quarter. that's five sectors. jp >> and you think those projections will continue to come down. >> they will until we get into probably mid-april after alcoa

reports -- >> and then a surprise beat. they beat the earnings that came down five times before they beat them. >> at $120 for the year, today's sapp s&p. >> it's actually $118.50. >> it's a little pricey. >> it's pricey when you don't have a catalyst for organic growth when you're not making the capital goods investment to fulfill the growth that's 17 times multiple as promised. >> and the scarier point that this keeps going, that the rally keeps going to the point where the multiple becomes higher and it doesn't take one of these events but something exogenous to end it all. >> i think the market react the way you saw today. a negative durable goods number. the they priced negative earnings growth but they'll only accept it for so long. we will need to see wage growth durable goods come in need to

see inflation a little bit better. >> look -- >> you know what would be great, if businesses stopped fleeing america and stayed home and made some investments here. >> and you know what else -- >> investments they are making now are buybacks and dividends and you will see more and more. >> carol? >> and it would also be great, larry, if the government acknowledged how important small businesses were and gave them the catalyst to continue to grow. i think that would be amazing. >> i think some president candidate should talk about this. >> i think so too, larry. >> one may be asked this evening. jeff cox, lindsey bell, thank you for being here. time for a cnbc news update with sue herera. >> hi, kelly. here is what's happening this hour. the army has charged bowe bergdahl with desertion. he abandoned his post in afghanistan and was held by the taliban for five years. he faces life 234 prison. a defense official says

orders have been given for the u.s.-led coalition to begin air strikes on the iraqi city of tikrit, this after the iraqi offensive on that city has stalled. schlumberger the world's largest oil field services company, has agreed to pay $233 million for violating u.s. sanctions in iran and sudan. it is part of the government's extended crackdown on companies doing business with countries that the u.s. has declared off limits. hundreds gathered in montgomery, alabama, to mark the 50th anniversary of the voting rights march. the commemorative march retraced the steps of the final leg of the selma to montgomery voting rights march that took place originally in 1965. and that is your cnbc news update this hour. back to you, kelly. >> sue herera thank you so much. warren buffett has an appetite for dealmaking. he just orchestrated the merger of kraft and heinz creating one of the world's largest food companies. but will wall street lose its appetite for mega deals because

of fears about the economy? that's next.

usually mega mergers gives the market the sentiment it needs for a broad rally, not today. the huge merger when kraft and

heinz did not help the market. much of the selling had to do that investors decided bad news was really bad news. a weakening economy, lower profits. so will huge deals like this be few and far between especially in rates rise later this year? sara eisen is covering this big deal for us all day. welcome. eric shippert and bill gotscalk from mesirow financial. sara, are you surprised the market response wasn't more positive, although kraft was the standout? >> kraft shares went up more than 30%. obviously wall street celebrated in that space because you saw other food companies like mondelez which used to be part of kraft more in the snacking division kellogg, all ended the day higher and bucked the trend of the weaker market. the question is is this it? was this the biggie? everyone was waiting for a sequel to heinz from 3g and from warren buffett. now it could be a long time

before we get another big one. >> eric, is that your view? >> this is the beginning. this is not the end. you're going to see more. you will see bigger. this is -- as long as financing continues to be at this level, it makes sense. i think 2015 will be the year of big mergers. >> wow. how big are we talking and can you give us a sense of where else? is it the food space? other industries you think might be next in line? >> i think there are opportunities in the food space. you have nestle you have campbell's kellogg, general mills. many companies right now that have stagnant growth for years that are opportunities, and many of them are disappointed frankly, that 3g did this deal because now they can't get in on the deal. i think there are opportunities in pharma. i think there are opportunities as well. obviously we see what may happen on the cable side. you could see something with dish and one of the other big providers. so i do think that we've only seen the beginning. you will see more as long as money continues to be at this level and i tend to agree with

larry's comment about the fed. i think you may see a period longer where rates won't go up and, therefore, you will provide a platform for this kind of opportunity. >> so, bill that's exactly what we're wondering here. on a day like this with the market selling off some worries about economic data does that help or hinder the kind of deal boom we're discussing? >> well i think eric is right. i think we will see more large, very material deals, and i think you got to ask the question why. larry pointed to one reason which is the availability and cost of money. that's very very helpful for the buyer even though he may be dissuaded at the margin by the high values we've got now. you have to ask the question why is that going on? and i think the answer is because our economy is essentially flat to modestly up. it's a stagnant environment. so many companies in many industries are having difficulty generating earnings through top line growth. >> you have to buy them. >> that clearly was the case at

kaeft kraft. the kraft/heinz deal is mostly about the synergies they will reap out of it not out of top line opportunities that may be generated. that difficulty of growing the top line is not singular to the food and beverage area. it's got wider implications. >> carol? >> and i hate not being contrarian. i actually agree with everybody here, but when you open up a scenario like this then you have every banker on wall street who is calling their clients saying now is really a good time everybody is -- the market is reacting positively. you have that on top of, like they said the low interest rates, a very easy lending environment anded need to produce earnings. i think you will see it across sectors and across sizes. >> i don't want to be the skunk at this party and i agree with everything -- >> you're in a striped suited. >> i want to say this. i'm a free market guy and the m&a is a market so i aren't the m&a market and gord bless alld bless

all of you and make as much money as you can. but let's not kid ourselves. that kind of m&a is a job killer. >> but is it a company saver? >> it may be a company saver. >> and is it an earnings booster? >> this is to me, just to me this is one of the negative consequences of easy money which is financing m&a which is frankly eliminating jobs. >> and that was a big part of the deal. the $1.5 billion in synergies between these two companies. the only other thing i would add to this conversation beyond sort of the macroeconomic growth that's been disappointing and the easy interest rate. in food and beverages there's been a massive sea change in terms of consumer tastes and attitudes going to healthy and organic and natural. that's where the double digit growth is. >> absolutely. >> that's companies you're seeing, the packaged food companies, a lot of traditional food companies, they're dealing with a double whammy. the slower economic growth around the world -- >> and they're buying a lot of those companies. that becomes a growth catalyst for a lot of companies is to

make acquisitions of those up and coming names. >> eric last word to you? >> you're absolutely right. the future on the food side is definitely health. i'm a vegan so i certainly sort by these kinds of things but i noticed my friends that are not vegans, they're looking for healthier options. i see it across the board. the bigger companies will end up scooping up and buying some of the smaller ones but that's a trend. it's a trend that's a good investment trend, an opportunity for investors to consider over the next three to five years because more and more people will realize this. >> new business -- >> we won't keep you around for the bobby flay burger segment coming up in a few minutes. >> thank you. >> new business startups new business startups are the greatest growth creator in this country, and we have had virtually no recovery in new business startups. >> so get to work people. >> that is why jobs have been so disappointing and growth. >> eric thank you. >> larry, you're so right. >> i'm not against m&a. i'm just saying it is what it is.

>> sara eisen on the big deal of the year. stocks ice cold today. the sell-off is heating up the "the hot list though"thoe. that's next. "thoe. that's next. thoe. that's next. ugh. that's next.

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we saw a surge of traffic come in. close to a quarter million readers came and dipped their toe in our coverage. there were looking at a lot of the pieces. you had jeff on jeff cox on earlier. he wrote -- he was talking about the sentiment where the pros are kind of bullish and mom and pop are kind of negative and down. he wrote that up and people have been diving into that story left and right. that's been getting a lot of attention. then we see our readers going around and trying to figure out what about the stocks we can count on what about the champion of the nasdaq apple. so good they threw it in the dow. we had a morningstar analyst throw cold at water on that. he said it will retreat to a $120 share level because it will cannibalize itself with the apple watch. that put a pal will gol on everything else. >> thanks, allen. good to see you. allen wastler.

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welcome back. not a pretty session on wall street today. so what's happening after the bell? we've had some earnings flying. dominic chu joins was a roundup of the action. >> here's what's happening. first of all what you have are shares of pvh corporation taking a bit of a move to the downside, off about 1.5% reporting erngts of $1.76 per share, beating analyst estimates of $1.73. revenues, however, a tad bit light, $2.07 billion. analysts looking for $2.1 billion. the q-1 earnings guy dance below estimates and full-year guidance was below estimates as well. it blames foreign exchange currency head wind strong u.s. dollar. red hat shares again, you can see a bit of a move here to the upside, 4%. that's after the company reported earnings of 43 cents a share, beating the analyst estimate of 41 cents. revenues coming in better in terms of its overall sales

numbers. we'll finish off with five below, again, a move to the upside. you can see up by about 4%. earnings came in better 61 cents a share, a penny better than estimates. sales coming in at $264 million. also a narrow beat over the $262 million average analyst estimate. however, revenue guidance was a little on the weaker side so again, some down winds but the stock up by 3.5% so at least for right now it's accentuate the positive and maybe eliminate the negative kelly. back to you. >> i'm looking at the panel. pvh a bit of a case study in what we were discussing although the fact their shares are down maybe suggesting losing patients without that top-line growth. snuld hope so. you would hope at some point in time investors would say we'll give credit on the top line because that will trick toll the bottom line. the one that stood out was five below, lower revenue guidance for a company that serves the lower end of the market.

in terms tf the core continue soum super, the strong dollar trickling down, that to me says we're concerned about wage growth. >> thanks, dominic. dominic chu back at headquarters. worries about a weakening economy. bobby flay expanding. there he is. just as concerns of a bad economy gather steam. his reaction next. friday night, buddy. you are gonna

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welcome back. the markets certainly soft today in part worries about economic data. are people still going to pay up for a high-end burger? bobby flay now has 18 bobby's burger palace locations in the country and plans to expand despite growing competition from burger chains like shake shack, recently hit being ipo market. we welcome back to "the closing bell" bobby flay. >> glad to be here. >> burger palace not a budget friendly place to be. is it healthy out there, increasing customer interest demand traffic ticket? >> unlike the broader market there is no volatility in the burger market especially the

better burger market. >> really. >> burger palace is -- you're supposed to smile when you say it. we do offer a lot of value. people spend about $10 a person when they go to bobby's burger palace. if you look at how mcdonald's has performed over the last decade and something like shake shack, which whether you think it's good value, overvalued or not, at $1.6 billion, i think it's a message that this is the future. >> carol? >> that's great for us. >> i want to to ask about your demographic. it seems like millennials are spending more money on food than clothing and other forms of entertainment. are you seeing more younger consumers? >> absolutely. first of all my daughter is 19 she goes to usc, so i get a good sort of focus group. >> i was going to ask which one but that probably -- california or carolina? >> california. these kids and people who are sort of the next generation are looking for better food. i mean, they grew up in a time when, you know, the food network's part of their life. so they know what's available for them to cook and they know

what's available for them to eat. a place like bobby's burger palace hits right there. >> today we saw a huge merger between kraft and heinz and there's this idea people are moving away from packaged foods, eating at home all together. other guests argued the opposite is about to happen millennials will settle down and buy more for the kitchen, the pantry. >> i think the millennials will definitely start cooking more at home and i think people are cooking more at home in general. but i think they're going to be eating healthier and buying healthier ingredients. >> wait a minute. is a crunch burger healthy? i'm reading this thing. double american cheese with potato chips. >> i'm on the cheeseburger diet. believe me it works. i crunchify my burgers because it gives it that contrast in texture. i think of the burger as the quintessential sandwich. put thin potato chips on there and you don't go back.

>> jobs are rising. we didn't talk about jobs today at all because everybody's so pessimistic. jobs are rising oil prices and almost every other price is falling. people have spare change in their pocket. do you see it? >> yeah. they're coming through the door. i think that people who wanted to pay a few extra dollars for a burger are lining up at the door. and think the people who are saying you know what we have disposable income but it's tuesday night, we want a casual meal they'll come to bobby's burger palace as well. >> how much room do you have to raise prices? if it's $10, does it have to stay $10? >> it could inch a little if it has to but it depends on the commodities. beef is through the roof like everything else on the shelves. >> last time you were here you said you were having trouble hiring. is that the case? >> it's always hard to find really good people to work for you but it's a constant program we always run. >> what's your average wage?

>> it depends. depending -- you know -- >> in two seconds. >> it all depends. it starts around $10 an hour and goes up to the manager. >> wish we had more time. you'll have to come back with the crunch burger. >> okay. >> "closing bell." "fast money" begins right now. stocks selling off today, the nasdaq getting hit the hardest, closing down more than 2%, the biggest drop of the year. we are at the center of it all in new york city's sometimes kwar. welcome to "fast money." i'm sixuan li. your traders tonight, we will be digging through today's market action throughout the show. there are knee three main sources of the sell-off today which we'll unpack. one, biotech taking a big hit. some saying the high-flying sector is potentially starting a correction biogen celgene all getting hit and lerszs known, infinity pharma should we be