street, "squawk alley" is live. ♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪ happy friday, welcome to "squawk alley," we want to welcome back kayla tauschi who got married over the weekend. congratulations, good to have you back. and john ford sheer, as we're dealing with a bit of a selloff, the dow is down 270 points. it's been weak for most of the morning. europe has been selling off for most of the day as well. with all major averages down 1%.

bert bertha coombs live at the nasdaq. >> when you look at the tech line and sectors, some of the favorites of the bulls are getting hit the hardest. biotechs pulling back today, all of those sort of beta names getting hit harder. got a real weakness today when it comes to chips as well. for the week, chips are the worst performers, we've gotten not so great outlook when it comes to chips as far as earnings. intel despite the fact that margins were better didn't have a tresk outlook because of pc weakness and we're getting the same message from amd, one of the worst performers today, dragging things lower on the day. apple hasn't been a help, either. it's been 0 off four of the last five days, it will report next week. maybe we'll get better outlook and better updated numbers, they've been in a quiet period on the sales of the watch. today rbc starts it at an outperform with a price target of $185. it's interesting that apple since hitting an all-time high

in february and being added to the dow. has had a hard time putting together back-to-back up days, a lot more back-to-back down days, below the 50-day moving average. pulled the whole nasdaq 100. seagate is one of the big winners after it had a profit. netflix at a new all-time high, extending its gains today and yale terra, moving to the upside and ma tell is the outlier here of bucking the trend. beating the quarterly numbers for the first time in six quarters. on comments from its new ceo, saying he's upbeat on the turn-around. he thinks they're starting to gain ground again on barbie. on mattel versus hasbro. it's a short-term chart. but this quarter it's starting to outperform. hasbro at all-time highs. back to you. >> bertha coombs, thanks so

much. for more, let's bring in art hogan, chief strategist at wunderlicht securities. >> there's a play to get neutral at about 2100 and call for some kind of pullback. do you think that's needed or prescribed at this moment? >> well certainly the playbook and people are certainly paying close attention. i think what we've got here is a juxtaposition of stocks at or near all-time highs and working their way higher in an environment where you have lackluster economic data, that's been the case for the last two weeks and earnings that are better than expected, but still not great. and expectations for the second half of the year certainly better than first half of the year. you have to try to rationalize how did we get to all-time highs necessarily. the one thing that's kept us here and hasn't broken is the energy trade if you look at the support that the energy trade has been in the s&p 500 this entire week. it's been the lead or close to the lead sector. that's on the pick-up and crude

energy stocks following suit. that's the good news. the bad news is the rest of the s&p 500 ticking oun trading at high multiples and at the upper end of the range. everybody is looking for a breakout to the top side. if that fails, then we need to drift back to the middle part of the range. that's what we're seeing today. getting a drift back or mean reversion back to the midsection of the range that we've been in. >> art, we look at the dow today, american express, one of the leading laggards on the dow, in part because of its earnings. but a lot of trade remembers talking about the fact that international at amx it's down 16%. there's been an expectation that international segments because of the stronger dollar would continue to suffer for another couple of quarters, do we go back to the playbook thaw need to be in stocks that primarily u.s. revenue focused? >> that's great question. look at the russell 2000 and the outperformance it's had versus the s&p 500 this year so far on a day-to-day basis.

that's the puzzle piece we'll find out if in fact investors start looking at the currency effect, the currency translation as being transitory and start investing in people that have organic growth. i think we'll see it more in the multinationals that are in the industry face, than we are necessarily in american express, american express has had a host of sort of negative publicity during the course of the quarter so there are some head winds for it as well. when you think about that sort of multinational, fx concern, the strong dollar concern as companies start to report. this may be the quarter where we put that behind us and think is the company growing organically and think about the fact that the strength of the dollar and the weakness of currency going to be something that abates in the second half of the quarter. >> within tech, looking at who's down more than 3%, workday down 5.5. net suite, splunk. sales force, rack space, all of the ones i mentioned having to

do with cloud. why do you think on a day like today? >> well you know what i think, i think berta said it almost entirely correctly when you say on the days we're having a bit of a correction, right, you're going to see much more of a correction in high beta. when you think about what has been the momentum play and cloud is certainly the poster child for that, so i don't think you'll make anything more of that except for the fact that when in fact you go into profit-taking mode, biotech, the cloud play, securities, software, any of the names that have outperformed the nasdaq in general, you know on a 12-month bases are going to the first ones you're pulling down. i don't thing that one day will make a difference, we're going to see those names being chased right back up as soon as we get a breather here and figure out where the stabilization point is on the markets, i think your point is well taken. the momentum plays, our momentum on the way up, they're dangerous on the way down. that's exactly why we call them high beta and momentum stocks to begin with. >> you can imagine another scenario where top of the

journal says the first rate hike is pushed out and the market rallies, not happening today, art. thanks for your time. art hogan from wundlicht. we've gotten room from bloomberg that its service to customers has been fully restored. the company, whose terminals are widely used by trading professionals did se suffer a service disruption. it said the problem was the result of an internal network error as people asked almost immediately whether it was the work of a cyberattack, it appears nod to have been the case. >> there is some expectation it could have had an he can on trading volumes as we saw declines across asia and europe. when we come back, will a move by verizon end the tv bundle as we know it? "the new york times" nick billiton will weigh in, and the s&p is down 25. below 2080.

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dow close to session lows, only ge is in the green and not by much. american express earnings, travelers downgraded amongst the worst-performing components. joining us on "squawk alley." nick bilton, journalist for "the new york times." lot to get to today. let's start with verizon.

breaking the tv bundle. the company announcing today, vios service will start offering new packages, giving customer the freedom to pay for channels they want to watch. verizon's president joined us on "squawk on the street." >> as you look at the economics of going purely ala carte, those aren't good economic force the business, based on how content is sold today, i think as you begin to look into the future and how we expect customers will buy, think this is absolutely a step in the right direction. >> such an interesting story, nick. such a long-time in coming. do you think, are we on the path officially now to true choice? to true ala carte in television? >> i'm going to be the curmudgeon this morning and say it's not enough. they're offering a package. which is great, less than we had the option of before. but still, still a package. i think that a lot of consumers still want to be able to pick one or two channels, they don't want to be bundled with 30 and

then other packages. and i don't think when you look at what consumers are doing today, you know they go to apple tv, they have netflix, they can pick a few different things they buy, and they consume. and i don't think that this is going to be enough of an incentive for them to not want to still continue to cut their cable and other channels. >> but nick, it's interesting, because the content has always been sold in bundles, right? the content providers say, hey if you're going to take this channel, we want you to take these five or six channels, too the shift here is that maybe customers will have a little more say, a little more weight in what they get. it's progress, but maybe it's more behind-the-scenes horse-trading progress than i get only exactly what i want progress, right? >> no, you're completely right. but i think that it's still the tv company is still trying to say we want people to have this, this and this and consumers are like, i don't want to watch that i don't want to have to pay for

this. you know, $65 a year is still a lot of money when you consider netflix has what, 62 million subscribers that pay less than $10 on average. what you're seeing is i think that the cable company still have not gone far enough. and when you look at trends with, with cable cutters, it's still low, it's still in the single-digit percentages. think that given the latest moves with hbo, and other networks, you're going to start to see that happen much, much quicker. >> nick, it appears to be a move to bow to what consumers have been demanding. but when you actually look at the pricing as you've just mentioned, who in the right mind would pay $85 for a skinny bundle when could get the triple play for $90, pay $5 more and you get so much more choice as well. i mean at $55 for the least expensive skinny bundle. $75 with internet, $85 with phone. it doesn't seem to be that much of a differentiation from what they're already offering.

>> here's my question who in their right mind would pay for cable at this point this time? i mean sorry to say this, i mean -- i truly believe this. i cut my cable five years ago and it was quite possibly the best technology decision i've ever made. better than getting a smartphone. because when i want to watch something, i go on apple tv and i pay for that thing, and that's it. if i, you know i can get streaming for pretty much everything i want. at first when i first cut cable i couldn't get sports channels, i couldn't get presidential debates and things like that. that's all changed. i think we're in a point in time where consumers can get whatever they want. when i was a kid, i watched cartoons you know on cable television. when i watch my niece today, she literally wakes oun a saturday morning, picks up her mom's computer and goes on youtube and watches cartoons. it's a different world. >> it reminds me of the pri, yot a soda at a theater for $3, you get one double the size for

$3.25. let's move on to apple, the journal saying that apple pay will launch in canada this fall. it would be the first international expansion for apple's mobile payment service. companies in talks with six banks about a potential launch as soon as november. the sticking point appears to be the fees, obviously. but also security. as you would expect. >> yeah, and i think apple has gotten a lot of the kinks worked out on security and they're able to communicate to the banks. here's why you need to take certain steps. if you want to implement apple pay. but for investors, interestingly, it seems to me like the value of apple pay at this point is similar to the watch. the stickiness of apple's ecosystem. if you use apple pay, you're likely more find value in the watch. if you get the watch you're more likely to want the latest iphone. they seem to be additive to the iphone versus breakout revenue events on their own. >> in the perspective of the

plastic revolution. the u.s. behind the curve of implementing emv. the majority of cards in the circulation in the u.s. are going to have to change. apple's value proposition of rolling out apple pay in the u.s. they could sort of leapfrog the amv transition in putting their terminals in place. but the international expansion of apple pay will be interesting. i'm interested in knowing how you think it will go, given that so many countries have transitioned to emv and they have a secure option. >> i'm surprised with the slowness that apple pay has gone out. i don't see it when i go out, i see it at certain grocery stores and things like that. but you know i think that they're going to have to kind of speed things up a little bit. internationally, domestically, everywhere if they really want to compete with some of the people that are already out there. and of course as you said, you know, have secure products that people are aware of that are easy to use. and that are already in the marketplace. >> yeah.

finally, nick, over 18 million views now and counting for one of the most anticipated trailers in history. >> yes. ♪ ♪ ♪ >> chewie, we're home. >> chills, chills. just part of the second trailer for star wars. "the force awakens." just the release was enough to send disney stock up higher intraday. jumped about 1%. bob iger talked to our own julia boorstin about how big the movie will be. >> no predictions on how bill it will be. there hasn't been a film out since 2005, actually. the movie-going audience in the world is much larger than it ever was. there are markets today that

were nonexistent before in terms of movie going. china being a great example of that. we're fairly confident that the foom film is going to do quite well. >> you got to love the smile on his face as he says, we're fairly confident this will be. faber made the point earlier this morning, disney broadly laughed at when they paid all that moveny for lucas film and you have to imagine they're going to, it's going to pay for itself soon. >> the franchise is just massive. and i think it's what's fascinating is you know, i grew up on "star wars" and kids today are still fascinate big it. it is evergreen and i think once the movie comes out, it generate more revenue for disney for products and toys. an endless stream of things. you can see the smile on iger's face, he's calculating in the back his head. i think it's going to be huge. >> biggest movie of all-time, i think from a financial perspective. >> biggest?

wow. >> i think it's -- look at "furious 7" great film i'm sure, doing so well right now. "star wars" 7? come on, think about the merchandising behind this. it's going to reawaken mass, which has been dormant for ten years as iger mentioned, we know how much merchandising picks up when something is released. they released this back catalog on digital of the previous "star wars" movies, so many different ways to monetize this. >> i think you're right and i think the thing that's changed since "star wars" first came out is when "star wars" came out you would go to the move isies and h the movie. now there's games in the app store, the past movies, future movies. it doesn't mean you're going to sell one ticket to a movie. it means you're going to sell things to an entire different audience across digital, physical, you name it. >> i keep looking at kayla. we're laughing because kayla what do we call it, settle a word for someone who has not seen the film?

>> maybe now that i'm not planning a wedding i can finally sit down. >> the big hairy guy on the left at the end of the trailer is chewbacca, he's a wookie. >> it's the best movie you'll ever see. >> it's crossing generations, my daughter is five years old and hummed the imperial march this morning because she heard it at school. >> that's awesome. >> it's crossing through. >> i do love "the new york times" piece on the full-time head of fan relations at lucas films. that has to respond to all of the handwritten letters that are coming in. it's an incredible franchise, it speaks to the power of the fan base that is spanning generations. so i'll join it one of these days. >> one company owns "let it go" and "the imperial march" let that sink in. >> kayla, you have to make us a promise that you're going to watch it this weekend. >> this weekend? what about next weekend. i'll let you know.

>> nick, thanks a lot. nick bilton of the "new york times." 3.1 billion, the largest vc funding in silicon valley history. and the dow just bounced slightly off of session sllows. tech and consumer discretionary sectors are faring worst. "squawk alley" will be right back. night? like, really big. then expanded. or their new product tanked. or not. what if they embrace new technology instead? imagine a company's future with the future of trading. company profile, a research tool on thinkorswim. from td ameritrade.

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markets in steep selloff mode with the tech sector leading wait down. down more than 1% this morning. the sector still up nearly 18% on the year. investors still eyeing growth opportunities. and vc firm new enterprise associates announcing it's raised its biggest venture fund ever. with more than $3.1 billion in new capital raised for its 15th fund and joint opportunity fund, it's the largest vc funding in

silicon valley history. joining us is nea's long-time managing general partner, peter barris. given all the money in silicon valley. all the talk about valuations being high, why shouldn't we worry that you're going to overpay for stuff with all this money? >> it's all about discipline, frankly. you got to worry a little bit with the velocity of capital coming into the industry. that people aren't going to act disciplined. we have the benefit of 38 years of history in the industry. we've seen boom markets and bust markets. and i think one of the things that our limited partners value about us is we've managed to navigate those waters and we're going to have to navigate them again. it's a great time for opportunity, but there are some land mines out there to be sure. >> you don't raise $3 billion without a long-term view, because the life cycle of these funds is five, seven, ten years, walk us through how you think the cycle will play out and where you think you'll find value over time? >> what we're seeing, i've been

in the industry for 23 years. i've never seen the kind of innovation ecosystem that we're looking at today. and by that i mean, as venture capitalists, we ride waves of innovation. back in the '90s, you saw the advent of the internet. but what's unique about this moment in time is that there's multiple ways of innovation, all happening simultaneously. so everybody is aware of mobile and how it's impacting people at the consumer level. but it's certainly impacting enterprises as well. layer on top of that cloud computing and software as a service, that's certainly makes it easier for start-ups to get started. but it's also impacting large enterprises and forcing them to rearchitect their entire information technology infrastructure. and i haven't seen anything like that since the '90s, when we went from a main frame world to a client server world and you saw companies like oracle and s.a.p. and emc come out of that.

so similarly you're going to see large behemoths, new industry leaders emerge out of this new set of opportunities. and i think the same thing frankly is happening on the health care side. with personalized medicine. so it's really an exciting time to be in this industry and it's got legs, it's not really a moment in time. it's got a five or ten-year leg to it. >> peter, think people understand what you mean when you talk about innovation, we're coming off of a week wildfire the eu is on google's tail. we know all the challenges uber has had around the world. are we back in that moment where the u.s. continues to innovate and runs into regulatory stone walls around the world? >> you got to worry about the regulatory environment. there's not a lot we can do about it. but innovation seems to trump the regulatory bureaucrat, if you will we have a history of that. we've seen it over time. and we're betting that that's going to happen again. >> pea ter.

you've got 47 current biopharma investments, given the size of the fund you're raising. is that an area it's a good time to put money in or no? >> we've been talking about the fact that large pharma companies are going to come off of their patents and in fact, they're not innovating at the same level they did in the past and they're going to be reliant on the kinds of companies that come out of our ecosystem. but we've been saying that for ten years, it finally seems to be manifesting itself. so we're excited about that. what you're seeing now that's really unique in that case, is with targeted molecular therapeutics and epi genetics, we're seeing innovation at an unprecedented level. but specifically for our kinds of companies, what it means is that to run a clinical trial, you can do it in a much more targeted way, which means effective and more timely way. in a less costly way. so drugs are getting to the market at a less costly way, and

faster and the fda seems to be cooperating by getting more efficient in terms of the approval of drugs. so the short answer to your question is we see a lot of opportunities going forward in biopharma. 75% of the ipos of venture-backed companies last year were in the health care space, most of that biopharma. >> peter barris of nea thanks so much for joining us. >> good being here, thanks. let's count you down to the close in the uk and across continental europe. markets selling off on the worries about the greek debt crisis. concerns about the stock market regulation in china. weighing on sentiment as they crack down on margin trading, investors seeking some safety in the german ten-year bund. eight bases points and eurozone banks among today's biggest losers, including germany's commerce bank and deutsche. still up an astounding 18% so

far this year. when we come back, starting next week, if you do a google search on your phone, the results could look a whole lot different. recode's kara swisher will join us to explain. we'll see if the close of europe alleviates any of the selling here. close to session lows, dow down 257. it took tennis legend serena williams, fencing champion tim morehouse and the rockettes years to master their craft. but only moments to master paying bills at chase.com. depositing checks at the atm and transferring funds on the mobile app. technology designed for you. so you can easily master the way you bank.

i'm sue herera, and here's

your cnbc news update. a somber memorial service was held in germany in honor of last month's germanwings plane crash victims. germany's chancellor and president, as well as hundreds of dignitaries gathered to pay tribute to those who died. saudi-led coalition airstrikes targeting shiite rebels intensify with bombings in the capital of sanaa, reaching their highest level since the campaign started. thick plumes of smoke rose above the capital as weapons stored in the mountains exploded and burned. wildfires rage in sigh beer yarks with the death toll at 30. officials say the wildfires covered 290,000 acres of land and more than 1500 houses have been burned down, left 5,000 homeless. veterinarians here in the midwest are warning pet owners to be cautious amid an outbreak

of canine flu, it's sickened 1,000 dogs in illinois, wisconsin, ohio and indiana. the string is believed to have originated in asia. that's our cnbc news update at this hour. let's get back to "squawk alley." thank you, sue. we want to get back to the markets, which are all major averages seeing their worst one-day decline since march 25th. despite better-than-expected inflation data and consumer sentiment numbers. down sharply in the red. bob pasani is on the floor to tell us what's moving inside the markets. >> welcome back, good to see you. important thing here folks is one fact, the world is putting a lot of money into china and in europe. throughout the year. and what we're seeing today is what the professionals call degrossing, lightening up on their exposure to these sectors. it's a simple way, thank heavens

for ets. you can see it, we're seeing very heavy volume in some of the china etfs, the asa chart is the china shares, it's only 11:30 eastern time. the china small cap. that's a clear evidence people are lightening up. and had in europe, we've had double-digit gains in a lot of europe. we're seeing heavy volume in some of the peripheral areas as well. the russia stock market sup this year. that's seeing heavy volume. portugal seeing some heavy volume. italy, spain, moderate heavy volume as well. the peripheral countries. no surprise there, some degrossing going on. we're seeing moderately heavy volume in the u.s. its been lousy frankly on the volume side. but the spider etf in the world, has good volume. we're 60% of the daily volume. the russell 2000 etf, the iwm, 80, 75% of daily volume. that constitutes heavy volume as

well. one thing we're seeing some heavy volume, finally near lightening up a little bit on some of the oil service names. oih this thing for months now people have been dieing to buy it, it's been on fire for the last moth, down a little, but the volume is notably heavy and some people are starting to listening to what they said, don't expect any immediate snap-back in any production levels. most sectors here in the united states, i am not seeing particularly heavy volume. and that includes by the way, the biotech etf, the ibb, no big indications we're seeing huge selloff, it's down a little bit today. really a lack of demand rather than heavy selling pressure. carl, back to you. >> see you in a little bit. got some big changes coming to google with some big implications for millions who use the company's search to shop, eat and find information. google reportedly said introduce a new search formula next week which will prioritize mobile-friendly websites when searching on smartphones and

tablets. joining us is recode's executive editor, kara swisher. how are you? >> how are you? >> they're calling it mobile-geddon. do you want to explain why this is important? >> any time google coughs, the rest of the world gets pneumonia. in the search area, mobile has become critically important, that's how everybody is using google so they've got to make sure these websites are mobile-friendly. so they're, it's not forcing, just responding to a trend that's happening among consumers, that search has moved to mobile. therefore sites that are more mobile-friendly should get better attention from google and better search results. it's not that complicated. it affect as lot of people. >> there's a sense that if anyone gets hurt by this, it would be small businesses that potentially wouldn't have the budgets to invest in reforming all of their websites do make them more mobile-friendly. even though i think we could agree the world is moving in that direction and having a more mobile-friendly website is a good thing. how do you square that?

>> well it's just the way it's going to be. this is what's happening and there's not, you can't really conduct websites on the web any more. people do not access it that way. it's like -- it's like saying you know, slid people are using cars, but we have horses. the people that used horses had to adapt and it's just, it's of course it's going to have a lot of economic impact. but google does this from time to time, they have these different algorithm changes and it sometimes favors better news, it sometimes favor what is google thinks is right and the problem is, is that google is such an important part in search and they're pretty much the only game in town in search that everybody has to respond to it. and it's again, they're not doing anything that's not already happening. and if you're not changing your business into a mobile business, you're in trouble. if you're using the web for anything important. so it's the way it is and everybody is going to have to adapt. >> i guess there are a couple of possible impacts, one would be positive for businesses that do web design and possibly for companies like adobe that provide the tools to do that. another is i imagine some businesses are going to have to decide, do we want to attack

mobile through the web or do we want to do it through apps? might this push people away from the web because of the cost of remaking the old legacy page? >> yeah, a lot of it is not as difficult as you're saying. can you do certain mobile-friendly things on your website. we think about it a lot at recode. should we have the app? should we do this? how do people access it? in general the bottom line is you have to have a website that's mobile-friendly. i could say it's google's world we all live in it, but it's a mobile world and we all live in it. if you have a business, you have to be mobile-friendly. it's a weird word, mobile-friendly. it will be whatever it is. whatever way the technology goes, businesses have to adapt. whatever the cost. >> kara, switching gears briefly. talk about the antitrust standoff with the eu. you sat down with president obama a while ago and asked him about europe's investigations into companies like google and facebook. his answer was interesting. let's take a listen to that.

>> in defense of google and facebook, sometimes the european response here is more commercially driven than anything else. as i said, there's some countries like germany given its history that is very sensitive to these issues but sometimes there are vendors, service provider who is can't compete with ours, are essentially trying to set up some road blocks for our companies to operate effectively there. >> so our own sarah eisen asked the eu's competition commissioner if in fact they're taking a protectionist stance against the u.s. tech industry. that's what she said. >> competition should be tough that would bring the best out of what you can achieve with innovation being customer-oriented. so i think the best for european consumers is to be as tough with european companies as with american. >> kara, recode kind of makes it sound like you can't fight city hall. this time and google has learned

that. >> yeah, i think in this case, we've written several stories about this. we had an internal memo that google was putting out about it. i think that the statement by president obama, i'm not so sure. i think he was carrying a little bit of water there for tech companies. i think they have some valid issues in europe and google is going to have to respond to them and i think they probably will settle a lot quicker. these are very thorny issues and they've gotten a pass in the u.s. over these things and europe is more strict in these areas. google has some good arguments about the fact that there's lots of competition and you know look what happened to microsoft. we had that monopoly trial and then things just changed, there were secular changes, lots of competition, things change all the time but the fact of the matter is that google completely dominates search in europe and it's right for those regulators to at least look at the impact on other businesses, think they have a tough group of people they're dealing with there and they're not used do it because the u.s. government so easy on them. >> when you think they're going to settle this quickly.

will it be a change in practices? pay a fine? combination of both? >> i think it's super complex. i mean it could be very costly for them. i suspect that i think they're going to be a little more, i think they understand that they're not, they're dealing with regulators that are not going to back down quite as easily. and the people, you know they do i think president obama was correct, is there's a history of much higher concerns around privacy and competition there. than in this country. a little more free-wheeling and so i suspect they're not going to fight it in this vociferous way. we've written that that settlement seems more likely. google did move the last time it settled more quickly than other companies have in the past when they've been fighting with european regulators. but this new european regulators took the place of the old one. i think is a little more tougher. probably a little tougher and google is facing a little more of a challenge here with her. >> kara, do you think the action in europe for google affects whether or not they're interested in making play for the 49% of yahoo's desk top

search that's now potentially open for bid do they want to stay away from that? given that. or might it make sense given that 51% will still be open to microsoft, of yahoo's search volume? >> you know it's interesting. because they tried it before as you know, john. and it was very bad for them here and that's when they attracted the ascension of the u.s. government. i think that the u.s. government wasn't going to let them do that at the time. and i think it was i don't know, five five years ago, six years ago. think that it's, maybe they could move into monetization with yahoo more than algorithm. they have have talked about it extensively before. previous administrations at yahoo had tried to strike a deal where google took over certain parts of search. i think at yahoo marissa mayer is quite interested in doing it herself. especially in mobile. she may want to rebuild yahoo's search business, that's something she's good at and is interested in. obviously doing a deal with google would be financially terrific for yahoo, because google does monetize so well.

so i don't know if, i don't know if they'll move in there, that's an aggressive move and could attract attention of regulators here in a way they're not going to want to have when europe is in a difficult position. >> there's a lot to watch. we didn't even get to earnings this week, kara. have a great weekend. kara swish frer recode. coming up more on the selloff, we're down 265 on the dow. rick santelli, what are you watching on this friday? >> we're watching interest rates, there's the countdown to zero for ten-year boon. which violated from a violation of five basis points. today we want to talk about the blue side of the card, are treasury as good buy or are they a good-bye? we'll talk about that after the break. when a moment spontaneously turns romantic,

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coming up, the big battle in the markets, is a correction under way in europe that's soon to spread here? some say yes, but jeff says stocks are ready to break out here. so which is it? plus, president obama and the italian prime minister meet the press in the next few minutes. we'll bring you the news live as it happens and the busiest week for earnings begins on monday. all the numbers you need to know today ahead of the reports. kayla, we'll see you in about ten minutes. welcome back. good to be back. even though it's a nasty day here on the markets. the dow down 262 points. worst one-day declines across the major averages since late

march. for more on the broad selloff, let's bring in christine cooper bob pasani was talking about the reason why the effects that happened in asia and europe are felt so strongly here. what are you telling people about investing outside the united states? >> well we still think it looks attractive. investors need to understand that we're likely to see more and more volatility. that's a function of the fed really dialling down monday fairy policy accommodation. in its march to normalization. that doesn't mean it's not a good investing destination. it means we need to be prepared for had these hiccups, this could be significant. but it may be a few days of really downward movement before we find bargain hunters popping in and bringing back stocks. >> you think the $82 billion

that has flowed into global mutual funds and etfs by sust investors won't move in the other direction. this is just a hiccup, as you say? >> this is part of a qe phenomenon. what we've seen is huge flows into japan because that's where qe is and huge flows, larger flows into europe, but it's something that we've seen in the past as well. so that shouldn't be the reason why we expect any kind of huge pullout of money. some will move on the margins. but we're likely to see the bulk of it staying because those investors are there because valuations look attractive, there's positive economic surprise coming out of europe and also we have that additional cushion of qe. >> i've noticed that a lot of emerging markets funds still have significant weightings in china, brazil. given the special nature of what's happening in china. if you have clients who want to take on emerging markets, look

at how those have been beaten down, what do you advise them to do to kind of x out china? >> well be selective. right now emerging asia x china looks attractive. there are a lot of positives going for that region. what you have is the emergence of a consumer that's becoming more affluent. they're being helped by lower oil prices. emerging asia x malaysia are all oil importers. there are a lot of reasons to be in emerging markets equities for the longer term. expecting volatility. but we need to be selective within the emerging markets phase. >> christina, this comes on a day when we're looking at a 1 of the "wall street journal" and this new sentiment that perhaps june is off the table for a rate hike because first quarter slowed down even if it's temporary was enough to spook fed officials in wanting to wait to see what the inflation data and what other data throughout

the year say. on any other day that would have been a story that would have probably been enough to move the markets to the positive by a couple hundred points and i'm wondering if you think that the fed is now looking abroad and saying that the larger macroenvironment is too unhaved for to us move at this moment. >> the fed is clearly concerned about what's going on outside the united states. it has a dual mandate daet that has nothing to do with that. it's about maximizing employment in the context of price stability. we think the fed is going to be paying alot of attention to the data it will be seeing in the secretary. we don't think it's made its mind up yet. yes, the probability of a june hike has diminished. our expectations are that there's still the possibility of a june hike and really the spread is between june and september in terms of when we think the fed is going to act first. janet yellen is clear it's not about the start of rate hikes,

it's about the path. we couldn't agree more. so our expectation is that whenever it occurs, june or september, we'll see some volatility around that. but what will ultimately end up with is a relatively low-rate environment for a longer period of time. >> so it will be a positive. a mild positive for markets. >> investors are starting to get used to volatility, like it or not, christina, we appreciate your time this morning. >> thanks for having me. >> christina hooper of allianz. as i look now, every maturity is lower in yield on the week. and on the week heave weave had some curves steepening, sort maturities, like a five-year, their yields are down more on week. for today there's a little bit of flattening as i see the 30-year bond, which has been the stubborn part of the curve, starting to get bid up a little bit. no matter how you slice it think most traders i talk to lately think they're surprised rates

aren't lower. let's put a face on this. for 2014, the entire year, treasury treasuries treasuries never traded in negative territory once. the opening yields at the beginning of 2014 was the high-water mark. this year is a little different. there's only been two sessions, year to date, at ten-year yields close to where they closed at 217 last year. they're tied to data which makes me feel good. the 295,000, the nonfarm jump we had on the headline number. that was released on the 6th of march, a friday. that day is the high yield close for the year at 224. the following monday, still digesting, we had our second of the two close above 217 to 219. all the rest of the year have lower yields, if you look at year to date returns on five-year, 2.3% and on 30's,

close to 2.5. the horsepower of these returns isn't so much your biannual yields you're getting it's the appreciation of price, let's put that into perspective. the low yields historically on five-year are 54 basis points, july of 12. 138 on 10s, july of 12. on the 30-year bond it was this year, at 222. the reason i bring that up is, there's a lot of room. there a lot of room. 54, we're at 130, 138, we're at 188. 222, we're at 255. when it comes to the notion are treasury as good buy or a good-bye. traders are still leaning good buy and keep in mind, closing comment, 224 the high yield, we talk about 1 of 4 the low yield. the average is a whisker under 2% and that and 186 from october gives you the trading range. back to you kayla and congratulations on the wonderful institution of marriage. i've been in that trade for 32

years. >> and i hear it's a good one, rick. that's why i'm in it, too, rick. technology is one of the worst-performing sectors in the s&p today. a slew much earnings on tap for next week. we'll look at how some of the stocks could move, when "squawk alley" comes back. [ male announcer ] legalzoom has helped start over 1 million businesses. if you have a business idea, we have a personalized legal solution that's right for you. with easy step-by-step guidance, we're here to help you turn your dream into a reality. start your business today with legalzoom.

all ten sectors of the s&p are lower today. technology is down over 1%. ourdom chu is back in headquarters watching it. >> not everyone is going done that route at least this week in

technology stocks. we took a look at some of the biggest gainers and worst losers of this week in technology. check out the hard disk make he is, seagate sup 4% on an earnings report. over the past week it's up about 5%, a lot of stocks took a huge hit over the course of the past couple of months. rebounding sharply since april. you go to another one here, western digital, another guide that's doing well in terms of data storage company. those shares up by 4% as well. two of the best performing stocks in the s&p 500 tech sector. as for the worst performers, check these out. maybe don't need any introduction, sandisk shares are down 6% over the course of the past week and another one, sky work solutions on the semiconductor side of things, they're down as well. down 5.5%. those are the best and worst performers where the action has been. looking to next week, we've got a huge swatch of earnings in the technology sector.

21 companies in the s&p 500 technology sector are going to report their earnings, monday you got big blue with ibm, tuesday, yahoo, facebook, qualcomm and ebay report on wednesday, thursday, another big day, google, microsoft, amazon, all three of those report thursday. friday, xerox reports, a tech company believe it or not these days, all these guys among the 21 stocks, carl in the s&p 500 technology sector slated to report earnings. so if you thought this week was busy, if you're a tech investor, next week is going to be big. >> christmas in april. four times a year. those earnings are enough to make your head hurt. especially we'll be thinking once again what business would have been like without the dollar as strong as it is. >> it might have been like halloween in april. >> what are you most interested in? >> s.a.p. is going to be big. facebook and qualcomm. qualcomm especially as we look at overall smartphone chip

shipments and then microsoft and google the next day. there's a lot. >> we'll get some sleep this weekend. thank you, guys, good to be back. jt. dow is down 240, let's get over to headquarters and wopner and the halftime report. thanks very much. split screen today because there are two big events that we continue to follow and one is on left of your screen. we're in fact you can see our own john harwood getting ready for the president and the italian prime minister to meet the press, discussing a range of topics relative to investors. the italian economy especially as greece's future hangs in the balance as it relates to its place in the eurozone. and on the right, certainly not playing second fiddle by any stretch. is what's happening in our financial markets today. there's a look at dowes