markets both ended the day higher. investor mood still jittery. >> should be an interesting final hour of trading here, brian, as we are still down on the session right now. >> and a big "fast money" 5:00 p.m. eastern. >> absolutely. i will see you then, brian. thanks for watching, everybody. >> "closing bell" starts right now. thanks, melissa. hi, everybody, what a week it has been, welcome to the "closing bell" on this friday, i'm kelly evans at the new york stock exchange. >> and im bill griffeth. stocks on another roller coaster ride today. we had that stronger than expected december jobs report this morning, looked like we may be off to the races with a rally, kicked off with a triple digit gain for the dow but we have given all of that back now. we are back just off the lows of the session down 56 points right now. >> that's despite a rally in china which has been the main culprit behind in week's selling. we have a lot more on what's happened and a look at some

stocks that may be bargained right now. plus there's the energy sector lagging as the rest of the market the oil crisis continues to slide. we will find out whether we are anywhere near a bottom yet. john ledger is no stranger to wars of words with rivals like verizon and sprint but you won't believe what he just said about a nonprofit organization critical of the carrier's brings omgs plan. let's start with the market short lived bounce we saw first thing in morning after that jobs report came out. bob pisani striking the action here at the stock exchange, steve liesman will give us the low down on that jobs report. bob, first you here on the floor here. >> well, bill, we had a 12 point gap up at the open but we've given back virtually all of it. take a look at the s&p 500, a lot of cross currents going on in the market but we were up overnight on the china markets

being up, then up a little bit as the jobs report came in better than expected. we moved to the down side here, a lot of cross current. that jobs report good news for the u.s. economy but has created concerns about additional fed rate hikes above and beyond what traders were expecting, the normal traders typically thinking two, maybe three on the year. china walking back issues is definitely a positive, they removed the stock circuit breakers and stocks have been dramatically oversold. we should be getting a bounce but we are not seeing it right now. you can see the way the market is looking. very defensive tilt to the market. telecom and utilities and consumer staple stocks have been the mod ets gainers. tech was a modest gainer earlier but it has given virtually all of its gains. a lot of disappointment in the financials, huge declines goldman sachs and morgan stanley down 9% in week. and on a day with a good jobs number you would think you would get a bounce. nothing is there right now. we are not seeing much enthusiasm overall. finally i want to take a look at

the vix, been elevated all throughout the week. it is down a little bit today, 23, 24 still very elevated level. the bottom line here is traders are continuing to anticipate more volatility in the near term. bill. >> all right. bob, thanks very much. >> let's get over to steve liesman for more details on that jobs report. it usually takes a couple hours to get that full picture, what is that picture? >> forget how confusing china's economy is. the u.s. is plenty perplexing enough for all of us as investors try to understand jobs surging and soaring but growth, gdp growth, weak and weakening for the first -- for the fourth quarter. the big 292000 jobs report shows the u.s. jobs machine is in high gear. 2.65 million jobs created in 2015, job growth strengthened as the year progressed. all of that happened amid weaker gdp growth. in fact, the inventory report from this morning released after the jobs report showed less stuff on wholesale the shelves,

a big decline causing forecasters to lower their estimates for the fourth quarter. for the eight time rammed updates come down to 1.2% for the prior quarter, a full percentage point below what had been originally thought. the most pessimistic on the street, morgan stanley looks for good gains just above zero. here is the jobs data that had everybody excited for a short amount of time, 292, october revisions up 50, unemployment rate unchanged at 5%. a tick higher in the participation rate but average hourly earnings disappointing. jpmorgan says this, when confronted with such a sharp divergence between labor market and gdp dat we tend to see the labor market -- >> acceleration in wage rates faster growth could necessitate higher real interest rates. the bottom line is this jobs number will make the fed happy at hike last month could suggest

another hike before spring has sprung and that's what the markets didn't like about it. >> larry kudlow would take the opposite side of what jpmorgan said. he would say if you don't have nominal gdp growing as far as the fed is concerned they're getting it wrong. is it possible they're overemphasizing labor market developments here? >> it could be but i was looking at the relationship between gdp and jobs, it's broken down. with this kind of job growth you should have 4% gdp growth or with this gdp growth you should have flat to negative job growth. something is amiss here. i don't know what it is. the decline in productivity we've been talking about. what i've been talking about is economists say the jobs growth may be telling us the better story of the health of the km he. >> and the wage component has disappointed a lot of people each as the labor market tightens seemingly you would think wages would be going up but they are not. >> i think it may be telling us there is more slack in the jobs

market. essentially it's a truism that employers do not have to pay up for employees or in the competition. we do hear some anecdotal evidence about skill shortages, but whatever the jobs that are being created or whatever the pool of employees it seems to be sufficient that the employers do not have to pay a lot to bring these workers on. >> all right, steve, thanks very much. appreciate your thoughts on that today. let's get to the "closing bell" exchange for friday, wrapping up a crazy week. ron wiener from rdm financial, steve grasso is at post 9 and rick santelli checks in from chicago. steve, you get to explain all of this after this week. what does it all mean now that we've started off with such a lousy market in 2016? >> white. it's about china, bill, obviously you know that by now, we all know that by now. when you see the market try to grasp on to anything, everybody keeps say we are the best country in a weak world, the truth is you cannot stay in the

bubble for long. we tried to rally today, we thought china stabilized, it did, but i think people are still skeptical. if the margins aren't going to expand, no one is rushing into equities right now, that's the plain and simple truth. >> that's especially true of some of the names behind you at post 8, the retailers, notably gap after disappointing numbers last night is down 15%, bill, today. it's starting to trade like american eagle, one of these volatile names. there you can see gap. meanwhile, target, kohl's also difficult sessions. ron, at the same time walmart has been an okay performer this week. what are you buying here, ron? >> we're actually taking a little off the volatility table and the one thing you can count on in 35 years of doing this with clients is that we almost always make the wrong financial decision in emotional times. these are going to be emotional times, they already had with pes pretty much fair valued, the

dollar a head wind, who knows what's going on with china, we don't expect much out of this market. maybe not for the first half. so a little bit more to value stocks, i will take a little bit of the volatility off. last year was a strong growth year, wasn't a value year. take a little bit off the growth table. >> anything specific, ron, in the value names you like. >> we like verizon, we actually -- don't laugh. we like the mlp space at 10, 11%. one day this thing will turn around but as long as we're clipping coupons we like it. otherwise, you know, we've stayed away from the retailers and really went to the splv, actually, we added 5% yesterday which is the nonvolatile etf, that's worked out, at least today it did. >> guys, before you run to rick, aeo because kelly brought it up, this has been a stock american eagle that has outperformed, it's getting crushed today.

i did bide catching the falling knife trade, i bought it today because i think this one was an outperformer and today it seems a little overdone. >> is that a trade or do you think there's more of a future for some of these names, especially as we hear of more closure in the mall and more questions about this space and the health of the consumer. >> there is a difference between a stock like aeo, they own their brand. if you look at the department store they don't own their brand, they have nothing exclusive about t you can get whatever you get there at five or six other venues, yes, you can get it online but they are there as well. for me i see our convention conference next week, i'm buying it ahead of that. >> rick, why don't the markets like this jobs report more than they did today? >> i think it's a monetary policy and fiscal policy issues. monetary policy front i think everybody is kind of getting it wrong. i think that bad policy needed to be reversed, i don't think it's based on economic strength

and i think the reason that productivity and gdp aren't correlating with the jobs report is because a lot of the fiscal policy is creating a major head wind, structural issues like healthcare issues, like dodd-frank issues and i think that both of those are somewhat fixable, but i do think it goes a long way to explain many of the issues, especially "on the money" tear policy side, why the market is looking for less, why everybody is looking at the response after the big jobs report and, you know, let's be honest here, if it was data dependent we would have never had the first rate hike. 2015 wasn't a good year compared to previous years. let's even take it a step farther. if you keep the participation rate locked as jim beeng co and i did today to crisis levels what you find is a wide disparate. i think the central focus of the fed and part of the reason the policy hasn't worked is because the correlation with the dropping unemployment rate isn't

truly reflective of the employment scenario, the employment landscape that's presently part of the u.s. and we all know the wages and all the other issues that go along with that. >> all right. before we go, steve, what numbers are you watching -- i mean, you're buying stocks that you think have been beaten down unnecessarily. how about the overall market, even some of the most bearish feel like we are oversold at this level here. >> yeah, i mean, we're definitely a little bit oversold but markets can become more oversold. the number that i pointed out on the show is 1867 that was the august lows and in the s&p cash, we are at 1937 or so. there is a blip support at 1930, there is a gap between 1930 and 1867. the truth is if we do not hold 1867 it's a long way down from there unfortunately. >> i've got to tell you, bill, trying to trade this market, i think it's going up, i think it's going down, it's confused, there are headwinds, tail winds, nothing seems to be working out. i'd pick your allocation that you can live with and stick with

it. >> if you can live with mlps you are a brave man indeed. >> i don't have any problems with the earnings. >> the headline from ron wiener is the market is going to fluctuate apparently. >> it's going to take 12 months. >> thanks, guys. have a good weekend. >> about 50 minutes to go here. keeping an eye on these markets, we have seen a lot of volunteering tilt, especially the last hour of the trading session. the dow for the moment is down 57 points, the s&p down another 7 and the nasdaq actually finally the outperformer today. it's only down about 8. >> goes without saying it's been a rough week for the bulls on wall street but believe it or not some stocks can be gaining ground, we have alluded to some of those. dom chu will run through the list of so-called stealth winners when we come back. >> also ahead two leading stock pickers name companies that could raise nice returns for your portfolio six months from now. you're watching cnbc first in business worldwide.

my name is griselda zendejas. i love working in the salinas area because i always wanted to do something where i could help people around me. so being a construction supervisor for pg&e gives me the opportunity to give a little bit back to my community. i have three boys. they're what keep me going every day. our friends, families live in the area. and it is important for all of us that we keep our community safe. together, we're building a better california. another retailer we're watching, container store, getting hammered down 42%. jpmorgan downgrade the stock to knew fral from overweight today. as we reported late yesterday the home goods retailer posted a surprising netd loss for its

fiscal third quarter and cut its full earnings forecast to well below street estimates. yet another retailer like we were highlighting gap earlier, now container store as well. >> in fairness bed bath doing okay, it might even be green today. they also reported yesterday, same kind of company. as mentioned pretty unsexy stocks have been notching some gains amid all of the selling today. on that note let's get over to dominic chu. >> as we take a look at the dow jones and s&p 500 let's focus on the s&p 500. the heat map is behind knee, this is today's action, there are some green spots on the board today, generally speaking we are fractionally lorg and are capping off one of the worst weeks we've seen ever to start off a new year. if you look at the s&p with today's action there are only between 40 and 45 stocks that are positive on a year to date basis. so again not that many. if you boil it down to just the ones who have been positive every single day so far, check

this out here, time warner actually extends its gains to late last year, five days in a row to start the year, it's up about 11% year to date. one of those ones we have been talking about for a while. not apple, not amazon, not one of those fang stocks but time warner doing very well. another one that's interesting, a utility stock, con edison, those shares are notched gains every single day so far this year. we know the utilities have gotten beaten up here, especially the last year given the fact we had interest rate worries, this is an interest rate sensitive sector. if you take a look at a few other names, reynolds american tobacco, on that basis we have not gained every single day but still they are posting hefty ones here, up almost 3%, big dividend yield in reynolds american. another one, thermal night vision engineering in fleer, fleer create to date has been up four out of the last five days, it's up 8% year to date. good moves out of that.

again, there are stocks overall that have seen nice gains to start the year overall, not necessarily the ones we focus on all the time, still they are moving some investor attention as we take a look at what's happening in the midst of all of this melee between oil prices and china. back over to you. >> some things to make us go hmm. >> yes. c & c music factory style. >> thank you very much. which other unsexy names are out there to own for the next, say, six months? chris johnson, barry james join us with their picks. good to see you, guys. chris, what would be the theme here? what constitutes a company that you feel will weather whatever storms are coming over the next six months here? >> do you know what, bill, there are sexy names and not sexy names. what we're looking for are those companies that have been steady or market leaders and they have been unrecognized. one of the ways we look at that is the analyst recommendations. we take a contrarian perspective, we're not saying

they're wrong we're saying there's room for upgrades and they are lee like to come as they continue their performance. we're looking for the underloved winners. >> netflix is on your list, though. that's unloved? >> think about it, first of all, 55% of the analysts that followed this stock have it ranked as a buy right now, that is actually the average for the nasdaq 100 stocks if you take the average buy recommendation. if you look at a company that has obvious leadership qualities to it to be that underloved right now is a surprise. you look at apple and it's 92% of the analysts following it have it recommended as a buy. >> that's part of the problem for apple. >> barry, let's bring you in here, barry james, you have a couple interesting picks. alaska air, cooper tire and dr. pepper. explain. >> yeah. well, kind of the idea there is unloved stocks didn't do very much last year, they are likely to do better this year and so we're looking for relatively cheap stocks that have very good earnings and have been outperforming the market all of

those meet that criteria. we also think that year it's important to have stocks that have some dividend yield and have been buying back shares. alaska of course very well known top in the power ratings, the jd power ratings, number one on time and they have been profitable for ten years straight. they know how to do their business well. most of their sales are in the united states. we think that's important, too. when you get to cooper tire, they are really helped out by the low oil prices both from the cost of their goods and the fact that we had the highest number of miles driven last year here in the united states. again, cheap with a decent yield on it. and they've really been buying back 10% of their shares. dr. pepper, he we talked about things that are unloved, it's unloved by analysts more than larry culpeper is unloved, it's really unloved but they are buying back shares and it's doing really well. >> we gave you a six-month time horiz horizon. you're picking undervalued companies or unloved companies.

what would make them come to their real value over the next six-month period, though? >> well, we hear about chasing returns all the time, usually it's at the end of the year. as the street and the market continues to see companies -- and barry mentioned one we like as well, dr. pepper/snapple. as we continue to outperform people will be looking at that strength and say what have i done wrong? clorox in this situation clorox returned 20% last year, 13% of the analysts have a recommended as a buy, they have strong revenue, strong earnings. there's nothing really wrong with that picture, it's just the rest of the street is going to catch up and we think that's what's going to help drive these prices higher. >> might have gotten a little expensive as it's gotten more popular. gentlemen, we will leave it there for the time being. >> thanks, guys. >> chris johnson and barry james. >> we have about 40 minutes left in the trading session. we have been hearing unofficially a bias to the down

side so the sell side as we head toward the close. i don't have any numbers on that yet but the dow is moving lower again, down 77 points right now. >> crude oil plunging about 10% just this week atop oil analyst will tell us where he thinks it goes next and weigh in on possible ipo of the world's largest oil producer. >> they could be a trillion dollar company if they did that. >> why the financial mess in china could spell good news for property owners and sellers here in the u.s. coming up. you pay your car insurance

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welcome back. keeping an eye on markets here, the dow now down about 63 points. again, after some strong gains earlier in the session after china's overnight session didn't disrupt things nearly like it has previously this week. that said boston beer is sliding, one of the names today that's a downgrade on jeffrey's to hold from buy. the analyst at jeffrey's citing margin pressures in the increasingly competitive beer market, those shares down 6.5% after we just talked to constellation while their business continues to do quite well. >> it's all about the beer market that's done well for them. we talk about the declines for the equity markets this week but how about the oil market this week. jackie deangelis sizing up the week that was at the nymex. jackie. >> certainly the declines in oil contributing to what we saw in equities. today fractionally lower, $33.16 is where wti finished. a more than 10% drop on the week

and five straight days of losses here. we did get oil rig numbers at 1:00 and they were down. oil rigs were down 20, but that didn't move the needle at all. the sentiment is to the down side. people are talk being that 2 handle, some are skeptical of it, but 32.10 was the intraday low this week. that's the spot to watch to break under that and hold under that to see if the momentum continues. gasoline was down more than 11% this week following along with crude. we thought we would see some relief at the pump, even though prices are relatively low, but the national average still saying just under that $2 mark. it's certainly something to watch for in the coming weeks. >> jackie, thank you. since the selloff in oil began 18 months ago traders and investors have wondered how long and how deep the slide would be. prices have fallen to well above $100 to 30. >> 70% decline over that time. we're joined by francisco blanch

who is head of commodities and derivatives research at bank of america, merrill lynch. good to see you. happy new year. >> happy new year to you. i mean, i will just cut to the chase, how much lower do you think oil can go? >> we think maybe a few more dollars. remember, we are still in the middle of a major chinese yuan depreciation. we still have to get the iranians barrels coming into the market when sanctions are lifted and we also have refinery maintenance ahead of us which means inventories for crude oil are going to build just at the wrong time. this is just the natural pace of the market. there is also a number of risks like the warm winter weather which could continue, there is also the risk that the iranians or the saudis increase production above expectation -- >> more -- >> they will increase supply above expectations. >> but the saudis have been cutting prices to undercut the

iranians as they come online. that doesn't help, either, right? >> exactly. it's the same thing, increasing production or prices is equivalent. i think the issue here is that we are probably a good six to eight weeks away from that trial of the refinery maintenance season and maybe also a couple months away from the point where emerging market foreign exchange might start to look cheap. remember that a year and a half ago emfx was expensive, last year it became valued, now starting to get cheap. i want to start looking into commodities and returning commodities when that emfx trade has played out, when the cny is close to 7 or so. >> by the way, francisco, what impact is it going to have if the saudis do start to float shares of aramco? what would that mean for the oil markets, saudi arabia? how are you thinking about the impact that will have on markets? >> it's a bit of a strange idea.

at a strange time. you know, i don't really think it has -- it has some direct implications for the oil markets straightaway, at least for the spot price. it may have some implications for the forward price, it definitely may have implications for the saudi currency. >> francisco, it's really interesting you put it that way, a strange idea at a strange time. the obvious catalyst would be that the saudis need to raise money, correct? i mean, it seems like actually a pretty logical move if you have to do something, why not monetize a company that's potentially worth trillions. >> exactly. >> first of all, the saudi arabia authority still has over $600 billion in foreign exchange at the central bank and presumably a fair amount of money at some of the oil funds in the country. saudi arabia has a lot of money. they don't need to raise capital

right now i don't think in an urgent manner. frankly, floating something like aramco or even a piece of aramco at the bottom doesn't seem like a very logical thing to do at this time. now, it is possible maybe that we see some pieces, some valuable pieces of the company being offered. i mean, i wouldn't be -- i wouldn't be surprised. we've seen similar things in the past. >> yeah. >> it would probably attract some capital to the kingdom. i think it would probably bring on the defense that there is a capital drain going on it would probably just signal there is a potential for capital inflows into saudi. in that sense i think, you know, it may create some comfort, but it is a bit of a strange idea i have to say. >> frin cisco good to see you again, thank you. >> thank you. >> time for a cnbc news update with sue herrera. sue. >> hi. here is what's happening at this

hour. mexico says it has recaptured drug lord joaquwith joaquin he co guzman. he was apprehended after a shootout with mexican marines in his home state. five people were killed and one marine was wounded, six suspects were arrested. campaigning in iowa, gop presidential candidate ted cruz telling voters he has never taken a breath when he was not a sus citizen. it comes in response to donald trump pushing cruz's birth in canada to a presidential eligibility decision. the cdc says all americans are eating more than the recommended level of sodium. consumption is the highest in men and those between the ages of 19 and 51. the excess was found mostly from eating processed and restaurant food. here comes another one, another hoverboard fire to report, this from an oklahoma city home where a hoverboard caught fire as it was charging. the u.s. consumer products

safety commission is working to figure out the root causes of so many of these fires. that is the cnbc news update this hour. back to you guys. see you in an hour. >> sue, thank you very much. we have a news alert on steve cohen, kate kelly stepping in with that. what now? >> in the wake of news that steve cohen was settled a civil case filed against him by the sec with a relatively attractive set of terms for him really, two year ban on managing outside money and no fine or admission of gift, word that their performance for the year 2015 very, very solid, 15.5% were the returns at any point 72, steve cohen's family office for last year, that stripped the largest hedge fund which was down 1%. taking a quick look at some of those top hold i think so they were in two big winners, amazon and alphabet to name two. they trade in and out of names at times very quickly at that fund, that's part of their style

so these are dated holdings, but amazon and google obviously would have been winners for them and also lulu lemon among their top holdings. a very strong performance here, terrific legal noose for them. it would seem 2016 is off a good start for steve cohen. >> before you go why do you think he got off so easy? two-year ban and nothing else? >> you know, bill, we've been talking about this all afternoon, i've spoken to some lawyers as well. it does seem like a relatively light punishment. >> especially when you consider -- we don't want to make light of this, but when you consider how aggressively the government was going after him for so many years and this is the final result now. >> you know, i think a few things happened, one very important thing is 50% of the sec's evidence of failure to supervise which was the allegation against cohen disappeared when michael steinberg who was one of the portfolio managers accused and convicted of insider trading was effectively exonerated by

related insider trading cases on appeal. part of the delay in the case we found out about today was that there was an appeals process that actually went as far as the supreme court, the solicitor general of the u.s. tried to get a key aspects of that insider trading case heard and was declined. once the civil case, sec case restarted and that was only a few weeks ago really the settlement talks came about pretty quickly. i think the sec saw their evidence weakened by the steinberg situation. also cohen had strong lawyers advising him. he was working with david boys among other people. he clearly had the resources to fight this tooth and nail. those are two explanations i have heard, hopefully more explanation toss come as well. >> thanks, kate very much. >> kate kelly there. 25 minutes to go. market is weakening again. a picture we saw about this time yesterday. >> right. >> not as big a decline but just the fact that these declines continue itself is significant. we haven't seen as poor a start to the year as this one, bill, i

think in the postwar period. the dow is down 104 points, the s&p down 13. >> again, vague talk of sell side imbalance and we haven't got numbers attached to that but we will get those to you. >> also tgif how will the markets cap off this october kree session and week? a leading trader will tell us what he's watching momentarily. we will discuss whether the economy is as rosy has this morning's job report certainly made it look. stay tuned. ♪ there's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here. fidelity -- where smarter investors will always be. if only the signs were as obvious when you trade. fidelity's active trader pro can help you find smarter entry and exit points and can help protect your potential profits. fidelity -- where smarter investors will always be.

welcome back. take a look at another triple digit decline for the dow, down 104 points with just a little over 20 minutes left to go in this session. the dow jones industrial average now having its worst week since september 2011, the nasdaq having its worst week since august 2011. remember what a weak period that was for the global markets and concerns about the economy then. this morning the strong jobs report not doing much to stem the bleeding today. >> let's talk about all that as we move into this last half hour of the trading day here with keith bliss. the market this week seeming to defy market rules and laws of physics at the same time. >> yeah, it is. we caught it oversold on monday

and it has continued to flop along here and actually go down. we have had really bad sloppy trading days here in the technical formations we got, the markets are vastly oversold on a short term and long-term basis. >> clearly last year the market -- the hallmark was buy the dips. >> yeah. >> that's not happening this week. so a change in psychology. what do you make of that? >> there is no bid inside of this market. when you look at trying to follow the flows of money there is no rotation either into other asset classes. it just seems like a liquidation. you mentioned last year that's important. how we finished december is more instructive than what we're doing the first week of this year. when you roll into a new year, when december is supposed to be the strongest month, when the last week of december is supposed to be the strongest week of the year. >> it was not. >> they both finished negative. that was a warning shot. i think people are using the chinese situation as a bit of an excuse to get out of the way for a while. >> any levels you're watching here? >> we need to close at 1935 on the s&p or we could see the august lows of 1867 in short

order. i don't think we're going to get there, this thing is melting away right before our eyes, if we're able to get there maybe next week we can get some footing, if we can get back up above 1975 that will take us to 1990 but who knows at this point. >> i think i got all that down. have a good weekend. >> i was just writing it down, too. thank you both. good jobs numbers from the labor department just this morning but markets as we discuss seem largely unimpressed. so is the economy really improving? jimmy pepacukus joins us along with robert reich, former secretary of labor and author of "saving capitalism for the many, not the few" we welcome you both. >> jimmy, do you think markets are concerned about some weakness that involves the job report or not? is this anxieties about the federal reserve. >> how are you reading things? >> i think this jobs report made it less likely that the fed would pursue sort of a go slow

add tud on those rate hikes, not that they will be raising at a rapid rate. listen, this is still a job market i think with all kinds of slack in it, whether you look at wages, whether you look at that prime age labor force participation rate. i don't think the fed should be raising at all or at least slower than what it is. it looks like it's going to continue to do that. i think perhaps investors would maybe like if it the fed did go slower than that. that doesn't look like it's going to happen after the strong jobs report. >> we wrapped up two years with the best job growth overall since 1999 but we still aren't seeing the wage growth. why? >> it's unusual, bill, where you have this degree of job growth and employers don't feel the necessity of bidding up wages. most of the job growth according to the bureau of labor

statistics is slug in low wage populations. leading the way was temp jobs and healthcare jobs, drivers, surface transportation jobs. jobs that don't pay very much. when you get -- and that's been the story of much of this recovery. >> that said, at least we're seeing progress, jimmy. i understand things aren't great but the broad unemployment rate is way down, you know, maybe people are coming back into the labor force that could be temporarily depressing wages as they absorb that. >> let's see what these numbers look like over the next 12 months. if we're sitting here in december and the unemployment rate is 4.5%, if they use number comes down another percentage point, if we are still sitting here talking about where is the wage growth, i hope we are not, maybe then we need to rethink some things. i don't think it's that much more complicated than still a slack question, even though obviously we have been over six years into this recovery. >> mr. secretary, somebody was making the point earlier today that in this age of the benefits

and how important they've become, healthcare most especially, that somebody -- the average wage earner is going to be referring to get those benefits in order to give up maybe the raise they would have gotten joisht wise. is that a fair assumption and factored into this lack of wage growth here? >> really even at the margins i don't think there's very much to that. i agree with jimmy, there is some slack in the labor market. if you look at the underemployment rate that the bls put out today it's very close to 10%. these are people who are too discouraged, look for work and working part-time and would rather be working full-time. when you have an underemployment rate that is that high you know there is a number of slack. the hours of work typical in a workweek is 34.5%, just around there -- 34.5 days, that also is indication of a lot of slack in the labor market. >> still there. all right. gentlemen, good to see you both. robert reich and jimmy

pepacukus. we're heading to the close, 17 minutes left in the trading session. down 132 points right now, so we are hitting lows for the session to cap off a very weak week for the market. >> the nasdaq while it's still the outperformer is having its worst week since august 2011. >> up next we will tell you which sectors and stocks tend to rally after a strong jobs report. >> tend to. >> tend to. that would be the key. and t-mobile's ceo john ledger is no stranger to dust ups on twitter, his latest four letter video tweet is taking on a nonprofits group drawing the ire of many.

13 minutes left. the selling continues. the dow right now down 148 points. we cap off a week that we're setting benchmarks that go back decades now in terms of the first week of trading, down 140, 150 points right now. all ten sectors of the s&p 500 index are negative. utilities were positive moments ago but they have just turned negative as we see the selling come in. >> a lot of the buying we saw on the close the first two or three days of the week now it's the

opposite. now people are selling it and we also know they are out of equities to the tune of $9 million this week. certainly selling the dips. which stocks usually do well when the jobs report beats expectations, remember that one this morning? what did you find deirdre? >> put simply when the jobs report bet on the economy and the u.s. consumer. how do you trade that in the market? we use big data crunch to take a look at what were some of the best trades one week after a forecast beating jobs report. there are parameters it had to have beaten by 10,000 jobs, there have been 44 instances that has happened since 2006. historically industrials and materials have been the best performers over this time. so thinking c sectors drive economic growth. consumer staples and discretionary are at the top of the that list because a better economy should mean more spending power from consumers. now, it has also been a good idea to hold on to healthcare

stocks after a forecast beating nfp with more employment comes for coverage and facilities. these five sectors from outperformed the s&p 500 one week oofr a forecast beating jobs report. they are ones that you could be looking at in this time frame. as you said, kelly, tensho is the keyword. make sure you check out cnbc pro because they have a list based on this data, the top five stocks to own after a forecast beating jobs report. back over to you guys. >> all right, deirdre, thanks so much. ten minutes to go in this historic week. i mean, it really has been that, bill, if you think about the way we started the year, if you think about the last time markets had this bad a week it was four years ago, almost, three and a half -- i don't even know what year it was, august and september 2011. >> art cashin stepped by, $1.7

billion to sell going into the close and we are already down 150 points. i think some of that is already in that right now, but with the beginning of this new year some things don't change. thankfully it's friday, that does mean it's david darst, he will join us for his take on this week's wild ride when we come back.

eight minutes left in the trading. i wish they would bring my market board back again. down 145 points on the industrial average. we bring in david darst the independent investment consultant. what a week this has been. >> well, you look at the manufacturing sector and there are eight factors that have -- that indicate the sickness in that sector in spite of housing, in spite of automobile sales. okay? all of these things that are going well. and the employment number 292000 jobs. philly fed, empire state manufacturing, chicago purchasing managers, bill, industrial production, factory orders, durable goods orders, ism manufacturing and the gdp now is indicating a sloppy fourth quarter. >> right. >> monday will be alcoa, we will start to kick off the earnings season and god forbid one of the four hercules that have been

holding up the market, the technology stocks, if they come in poorly, so it's earnings, not only china, not only korea. >> i get that, but even more primel than that, just the psychology of this market this week, we were talking during the break that that january prompter, the first week barometer it has a success rate of 87 plus percent. >> predictability rate. >> for the year. >> is there anybody you love listening to? i love listening to you and kelly. i could listen to the two of you read the manhattan telephone directly to me and i would be very satisfied. >> you want something. >> one of mine is mohammed he will alaria and this morning he said that the market is in the process of repricing investor confidence in the inn fallibility of central banks and we need to see the fed give an explicit signal, we will take it easy until june. okay. there is some debate over whether we will have something in march or april, those are the

two next meetings after january. >> so when all is said and done it still could come back to the fed and whether the rate hike was the right thing to do. >> it's coming back to central bank, market confidence, china. i would say the risk of recession seems higher to people, that's the worry. >> yeah. >> but as long as you get -- as long as you get this gift, we need a gift, we need china's central bank, we need the european central bank, the u.s. central bank to do something and earnings to be in there. if not, financials, healthcare and consumer durables is where you want to be. >> all right. always good to see you. >> thank you. thank you, guys. >> happy new year. >> and to you as well. we will come back with the closing countdown, bob pisani and i with a few charts to review. about to start the whole long distance thing yeah and lots of data will mean lots of video chatting how much is that? 15 gigs, that's over 40 hours of video chatting wow whoa

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all right. we are just at the two minute mark here to the close and clearly the selling that we saw in the close, the imbalance, has taken a toll here as we close out a moment to us week. let me just review quickly as bob pisani joins me here. these one-week charts. again, china was the straw stirring the drink around the world, that's what it did this week with a decline of roughly 10% for the shanghai, the shenzhen market this week. our own market, let's see the dow here, bob, as we close out here with this decline of almost 200 points. today for the week a decline of 6.33% on the industrial average. crude oil the biggest decliner on wti down 10% for the week,

now 11.2% in the electronic session and gold popped early this week, it leveled off here the last couple of days but for the week it shows a gain of 4%. >> what this has shown us is despite the fact that china has walked back some of its so-called reforms or efforts to control the market, walked them back, i think, admitted they were wrong, despite the fact we were dramatically oversold and despite the fact that the payroll numbers are still good for the economy it's not good enough. >> i think the psychology has turned, that is clear. >> that's for sure. i think there still is -- ultimately the issue is global growth. remember, the currency issues we're seeing in china is the effect of the worries on global growth, capital flights, things like that happening and until we sort of deal with that overall issue i think it's going to be tough. fortunately next week we will get a lot of the big banks, i think the consumer is in a little bit better shape than some people think. that will be the good news. >> we get ready for earnings

next week. that should be very instructive. what a week it has been to start the year off here at the big board, progressive insurance is ringing the closing bell, at the nasdaq they are celebrating their fifth around fit week. the second hour of the "closing bell" with kelly evans and company. have a good weekend. thank you, bill. welcome to the "closing bell," everybody, i'm kelly evans a difficult finish to a difficult week. not even a strong december jobs report could turn this market around, the dow rallied triple digits at the open but gave all of that back throughout the day and closed sharply lower, just at the lows of the session down 171 points on the bell there, more than a 1% drop for the week the dow down about 6% posting its worst fifth five-day start to the year ever. here is a check on the other major averages, the s&p 500 declining 21 points today, having its worst week since 2011, the nasdaq same story,

even it caught up to the declines we saw with the others today, down 45 minutes or another 1%, 1921 is the closing level for the s&p 500 this afternoon. joining today's panel we have our own mike santoli in the house, along with cnbc contributor evan newmark, welcome. we're joined by "fast money" trading tim see more. we will get to everybody in just a moment. let's start here with bob pisani who is on the floor to wrap up the mild week that its been, bob. >> what a disappointment we had at the close here, a lot of people were hopeful we would hold the gains but we didn't throughout the day, we had a large market on close orders coming in and that was enough to bring the market essentially at the lows for the day. let's recap the week and see what happened here. this was a week where right across the board and these are still not final numbers for the s&p but right across the board down 6, 7, 8% no matter where you looked, russell 2,000, germany down 8%, japan down 7%, china down 10%, that's the shanghai index there. dow stocks for the week, there is not much you can go and hide

with here. i want to know there are some sectors that did underperform here. financials were on the weak side, jpmorgan and goldman sachs had no bounce at all today, big global industrial names, bowings and general electric also underperformed the overall market and of course oil led by chevron underperformed, although exxon was the loan exemplar down only about 2.5%. there was not much in the way of rotation for the week, however, you can obviously that defensive names, your mcdonald's, verizon, merck and coke were not down nearly as much as the big global industrial names or financial names. that's the best that you can say for the whole situation. we are going to spin ahead now to next week and the key is big financials. we will be reporting all of these names will be coming next week, jpmorgan, black rock, citi group, pnc financial. remember, jpmorgan, this is an amazing week, jpmorgan dropped 10% this week, so did citi

group. pnc and the super regionals like wells fargo did not drop as much, but 6, 7, 8% declines it might as well have been that bad. the only hope is that attention is going to turn to those big banks, they will be commenting on how the consumers -- >> it's interesting, i wonder and think it was rbc who raised this question. does the jobs report matter, like the way that it once did. i mean, is it because it was strong and people are afraid the fed is making a policy error by continuing to raise and it has nothing to do with that and the global growth picture. >> i don't think this particular report came with high stakes, mainly because it's in the middle of when they will have to make any decision on what happens next. i feel like a strong number was a net positive, you wanted to see more jobs versus fewer, but that doesn't really tell you much about what the growth picture is like right now outside the labor market. i don't think there's a perception that this strong number forces the fed's hand in

any respect. there is a lot of time and a lot of market action to happen between now and march where we might get some first moves. >> stanley fischer's comments weigh so much on people's minds. they go, wait a minute, here is a guy amid all the market turmoil this week was saying the all clear, time to raise rates, the fundamentals are strong. >> my interpretation of that is he is the one who is being put out there to voice that line. you know, they are still in the mode of justifying the december move, let's remember, it was only less than a month ago. they still have to say this is our plan. they are not going to completely go against what the market is pricing in right now, right now the market looks nothing like four hikes, but it was only two, three months between september and when december became a done deal. you have to keep in mind how fast things can change. >> kind of the same larger question which is -- it looks like there's a big disconnect between the strong jobs report, horrible gdp growth and the market is listening more to gdp than jobs. >> the market is looking for an

excuse to sell. there are fund managers who don't want to start the year in the hole. >> right. >> they are already a little bit in the hole and they probably got a little panicky today and they said i don't want to sit around being down 6% early in the year. i think that's the totally wrong way to look at this stock market. i look at this, you know, i've been sitting on 40% cash for over a year now. >> you said the market would be flat last year. >> i said it was going to be flat, it was flat. i go, do you know what, this actually to me this is all looking good. if the s&p drops below 1900, mid 1800s i starting to it doesn't look so expensive anymore. jobs report was good, europe is seeing a little bit of growth, i think the chinese market as a casino that effects investor psychology more than anything else. is china doing great? probably not. i think it makes a huge difference, probably not. >> would you buy broadly? >> no, i still -- i love energy, i'm one of these guys -- >> how is your energy doing. >> the energy trade is down

about 15%. >> 15? >> 15% for the money i put to work last year but i was buying yesterday, i bought the day before yesterday. every time it reaches a new low, down 2, 3%, i buy. a lot of people -- >> you might own all of it. >> exactly. soon i will be the single largest holder of exxon. i doubt that. you know, to me, again, it comes down to would i rather own a share of exxon in the low 70s or share of facebook in the 100, it's not even close. there's something wrong when facebook is bigger than exxon. >> i think evan is talking about would i rather own a good balance sheet or a high multiple growth stock that did very well last year. i have to say i look at the energy sector and i think there are good balance sheets that are worth owning at this juncture. i look at where -- the dynamics on oil if you look at the micro wti, brent a trading in tandem, you've taken out a lot of surplus u.s. supply, you're starting to see some of the defaults and a place where we

all know production is probably around 50 bucks where these guys are profitable. we're getting there. a year from now where do i want to be in energy stocks, yeah, where will we be in those same stocks, i think you will be higher. i agree with that trade. where fund managers are right now it's very difficult to handicap central bank policy. right now we see chinese central bank policy bleeding into the globe. the reality is the yuan has to go lower. how quickly, i don't know, but it's going lower and the vix last night was a function of this new basket of currencies that are on a trade weighted basis. it's going to happen again. you have trade data next week with china, cpi tomorrow, these are things people are watching. >> which is going to be more important, mike? >> i think the way china operates we have another session before we open on monday, so if we get a couple of days of stabilization that's fine. i don't think we're waiting for china to be fixed, i think we're waiting for it to kind of burn out as an issue, not get any worse and i think we will be

okay. look, markets don't bottom on a friday, it's one of the few rules of thumb that actually seem to be true and you also afraid of that monday spillover which we saw in august. two reasons for people to shrug off. it's looking like this is all part of the same correction or gut check that we've been undergoing for months now. >> and can i just pile on that with sort of a longer term view which is it's impossible to call bottoms or tops. and that is time and time again we see this. so for a lot of your viewers out there i would say, listen, don't try and time the exact bottom in energy. >> yes. >> don't try and time when you think gold is going -- you know, what you should do is figure out what you want your allocation to be over the next year, see where you are now going into the year and over time put money into work. don't try to time t you will be wrong, i promise you that. >> that's part of the humbling exercise in investing. >> we will bring in tom gym bl.

great to have you with us as we raise this larger question about is the job data as strong as it appeared on the surface and if so why isn't there more relief, certainly not showing up in markets today. >> we added almost 300,000 jobs in december, that's a great sign. imagine what the reaction would be if we only would have added 120,000 jobs in the stock market had done what it did this week. i think we have to look at this as a positive. it's one week in the stock market and while you have experts who are analysts on this i agree with what evan said about managers and their selling off so they don't lose more. what we have to look at is companies are hiring and we are seeing it in the small and medium sized companies that are hiring and, yes, some of the bigger companies, the macy's and the oil companies are doing layoffs or have done layoffs, but small and medium sized companies are hiring in this country. >> what would you guys say? >> i think -- i think the hiring -- you know, the question is whether you see a feed through to wages. i mean, that's what we keep on coming back to and the wages didn't budge at all, the average

hourly wage was the same. >> they were okay. >> they are up 2.5% year over year. i think that is the key to look for and whether or not the tightening has the wage gains coming through. i don't know when that's going to happen. >> tom, do you see that starting to happen anecdotally at all? >> no, i don't see the wages increasing for quite some time but i think that's more of a reflection of the global question and i don't think we're going to see jobs reduce here in america but i don't think we will see rapid wage growth either for quite some time. >> mike. >> i guess i would ask are you actually seeing evidence of people coming into the labor force, the longer term unemployed actually had greater gains in jobs than people who haven't been out of the work force. is that part of the dynamic that might be evident at this stage of the game? >> no, i'm not seeing that as much. i still don't see the long-term unemployment. i think that's what gets into the skills gap issue. we are still seeing people and you will see it in january as well, we get people entering the work force graduating from college in december and may, you always see an increase in

january and in june in that regard where companies are hiring there, but the long-term unemployed of 12 months or longer, that's a skills gap issue and i don't think we will see that change. unemployment was flat at 5.1%. i don't know if that's as big an issue. >> what's your reading on all of this? do you have any questions? >> tim? >> yes, to you, sir. >> my question is how confident are ceos and what are we going to hear in earnings season. the conference board has an index out there that ceo confidence tends to lead gdp. joe lavohna put that out. we're going into an earnings season where people feel as though gross margins and epf multiples are going down and they are only going down and ceos are less confident than in a long time. i wonder how you feel about that. >> i see that issue but i also see that they want to take advantage of this market right now and i didn't see a lot of craziness as a result of the fed raising rates from ceos. i did see, yes, the stock market

is down this week but it's one week and people being bullish on the future of the next six months, my company did survey data across the country of hiring managers and over 50% were anticipating hiring in the first quarter of this year. i think hiring growth is going to continue. >> i would say the corollary to that, to what tim said about ceo confidence, if ceo confidence leads gdp the stock market leads ceo confidence and we're down 10% from the highs. >> it can become a negative cycle. >> i think it depends on the ceo. if you are a mining ceo or you make mining equipment, you're down. i mean, there are huge bear markets that have been going on for years now and at some point maybe they turn. i don't know. i'm not going to call the turn, but in certain sectors, the oil sector, commodity sector, heavy equipment sector, those sectors have been down for years. >> quick last word, tom. >> let's not ask macy's and the oil companies if they are optimistic, but let's ask the financial sector if they're

optimistic, let's ask the technology sector if they're optimistic and professional services. i see those companies growing. >> i would just say and i'm not that in he go testify on the global growth and i think people have possibly overreacted to china, but we are at a place where you're looking at where earnings have probably peaked and probably peaked a year ago. we're going into a period where there is a lot of recession naer forces on the industrial side of the united states, you have a global growth story which is as weak as it's been in a long time and a strong dollar. these are issues facing earnings for ceos that make their job tougher. >> if we can keep chugging along here in this country that would be remarkable in itself. thanks for joining us. tom and tim, appreciate it. be sure to stick around to catch tim with the rest of the "fast money" crew at 5:00. they have the four stocks you should buy in this week's selloff. we will discuss whether a continuing devaluation of china's currency could spark a global currency war. >> plus new data shows retail investors dumping stocks in favor of bonds.

is there a recipe for success or disaster right now? you're watching cnbc first in business worldwide.

there was some green today. one of the biggest concerns about china's devaluation of its currency is whether that could spark a global currency war. seema mody is here with a look at that possibility. seema. >> that's right. the worries that if the chinese yuan continues to fall other "closing bell"s will respond by deval would you think their currencies, taiwan, vietnam, taiwan, malaysia have already been hit as exports to the world's second largest economy continues to decline and has resulted in a significant drop in asian currencies. going forward experts say these countries that have a high export ratio with china could use their currency as a way to stimulate growth. but competitive devaluations are not limited to asia. dbh says weakness in china gives europe and the ecb further impetus to reveal additional qe would would weaken their currency the euro. lastly keep an eye on mexico.

today its finance i can't thinker said the yuan's fall who start a round of perverse currency wars, the peso hitting a record low. >> makes other export markets less competitive. thank you. china and u.s. markets a little calmer today, but volatility still looms. fundamental concerns continue about the chinese economy and how the government will manage both its markets and currency. for more david i would dell joins us, he is president, ceo and chief investment strategist at wadell and associates. how are you guys investing amid all this turbulence? >> it's important to keep everything in perspective. i think the interesting thing about the investment climate is that wall street tends to forget china is on a course that is predetermin predetermined, they broadcast it through their releases and so they've basically said we're going to market base sort of economics and part of that is to liberal lies their currency regime.

once the imf put them in the basket that allowed them to basically play out the policy and let the currency float. the half step is the basket eventually it will float but that currency needs to come down to realign with economic fundamentals and that's what's happening. wall street tends to forget it, gets spooked. so i'm not nearly as fried nd as maybe the average analyst. >> evan, that's what you were saying earlier. >> i think that's right. it's hard sometimes to step back and look at the big picture. i think the big picture is china liberal zags, presence kree going more freely tradable. that's not bad, that's good. >> are we convinced these are steps forward and not back? >> we've been living in a world where central banks and governments have been thinking they can manage their way through everything. i'm a big believer let the markets figure it out and they will do a better job.

>> in china they will tried to take steps for global liesing their market and currency but it's not going the way they want so they shut it down. it goes lower and that's it seems what they need to be competitive anyway. >> well, i mean, nobody bats an eye when europe devalues by 30%. right? so the world is in an industrial recession. the chinese economy is bifurcated between the old economy which is industrial and construction and the new economies which is services and construction. so the transition i think they've actually been successful from policy implementation standpoint but it's going to be ugly and they're moving from, you know, command and control economy to a market-based economy and every once in awhile the sheep will overrun the herder and we see that periodically but that doesn't indicate that the approximately si is wrong it just means its challenging and difficult. either you believe in china or you don't. i happen to believe in china but that doesn't mean that it's

going to be without skepticism and doubt and periodic bouts of, you know, fearful market action. >> david, maybe it's the market's fearing the implications even if it's a correct policy. growth is scarce in the world, china is making a bid to have a greater share of it by getting its currency down as you say as other parts of the world have done against the dollar already. is it more of a legitimate concern that we are concerned about where the companies and the other economies are going to be able to find some growth. >> yeah, i think you're absolutely right and i also think people forget we are dependent on china's growth rate. so china is a $10 trillion economy growing at 6%, that's $600 billion in incremental growth, our economy is a $17 trillion economy growing at 2%, that's $340 billion in incremental growth. in china is slowing more than we think they're slowing then earnings will be punk in 2016 just as they were punk in 2015. the fed has become oppositional

and they are in control of the market multiple. so all of that is reason to sit back and just wait and see. >> that being said, david, before you go, then, would you be buying china and trying to expose names here? >> i think that's a great question. the chinese market is crazy but the 8 share market is trading at 11 times earnings and hasn't moved since 2009. off the low in 2008 china is up about 60%. the uss is up 300% and has dominated the tape for the last five years. my guess is there is a rotation at some point. i'm not quite comfortable putting my retiree client assets there yet, but it's out there. >> maybe not the whole thing anyway. thank you, david, for your views. appreciate it. >> thanks for having me on. >> david waddell with thoughts on china. coming up much more on this selloff which continued today and whether this year could end up being a buying opportunity. republican presidential candidate donald trump proposing to slap a 15% tariff on chinese

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welcome back. with everything else happening this week the white house trying to convince the world's biggest tech companies to stop terrorists from using the internet. eamon javers has more on this meeting. >> we are in washington, d.c. but out in san jose, california,

our cnbc live cameras got a picture. take a look at this. this front door is the u.s. patent and trademark office in downtown san jose. behind that door some of silicon valley's tech elite are meeting with the absolute top brass in the obama administration in terms of intelligence, law enforcement and the white house trying to come up with ways to combat isis propaganda on the internet. what exactly are they discussing in this very closely held meeting? it's hard to tell. just within the past couple hours i've obtained this document which is excerpts of the briefing document that was handed out to participants inside this meeting which is going on right now. a couple key things they are talking about in there, one question, are there technologies that could make it harder for terrorists to use the internet to mobilize, facilitate and operationalize or easier for us to find them when they do? another thing they are looking at is some have suggested that a measurement of level of radicalization could provide insight to measure levels of

radical sfwlags to violence. a partnership to determine if it can be measured for isil and sournt isil content could be benefici beneficial. that is some of what they're talking about inside this meeting. also on the table encryption, that has been a touchy issues through silicon valley and the white house over the past several months. earlier today white house press secretary josh earnest gave reporters at the white house a little bit more detail of what exactly is driving the need for this meeting right now. here is what he said. >> i do think there is an opportunity for there to be a robust discussion about ways we can make it harder for terrorists to leverage the internet to recruit, a radicalize and mobilize supporters to carry out acts of violence. >> and just as we're watching this right now we're seeing some movement here in front of the patent and trademark office in san jose, california. not exactly clear just yet who is emerging from this meeting but among those people that were expected to be signed side the meeting was the attorney general

loretta lynch, james comey, james clapper and nsa director michael rogers. kelly, back over to you. >> and to my, you know, unscientific eye that looks like chris young of intel who we just saw walking out there as well. evan. >> question for eamon which is, listen, you know, silicon valley is notorious for its let's call it libertarian leanings, very strong on freedom of speech, very anti-government intrusion. how do you go about convincing these people that it's in their -- in their benefit to actually cooperate in some way that could be seen as in fact getting involved with the government? >> well, do you what they're doing right now, you send the entire top brass, the head of the fbi, head of the nsa, head of u.s. intelligence all of them to have a meeting in the same room at the same time. that.sends a message. the other thing you do is what white house press secretary josh earnest said from the podium at the white house today, he said, look, all of these tech executives are patriotic

americans, we know there are ways for us to find common ground. by calling them a treat tick americans, praising them in effect from the white house podium and then using the stick of sending the stop intelligence executives out there, that's pretty much what the exhaust can do here. you're right, these tech companies have resisted this for a long time, they don't want to be seen as in bed with the u.s. government most for political reasons and also because they view themselves with global companies with a bigger market than just this country. >> eamon javers with the latest out of washington. time for a cnbc news update with sue herrera. >> here is what's happening this hour. mexico says it has recaptured drug board joaquin "el chapo" guzman six months after he escaped from a maximum security prison. he was apprehended after a shootout with mexican marines in his home state. five people were killed in that incident, one marine was wounded in the clash, six suspects were arrested. reports of a shooting at an egyptian red sea resort frequented by foreigners.

three armed men stormed and injured two tourists, they stormed the hotel as you can see. two of the attackers were shot and killed by egyptian security. >> chipotle is being sued for allegedly misleading investors about its food safety controls. the civil lawsuit filed in new york accuses the burrito chain of failing to disclose that its quality controls were inadequate to safeguard consumer and employee health. and he's at a again, russian president putin taking part in a training jaw dough fight. the jaw dough session is the latest event showing putin as physically fit to show the russian people that he is the right man to lead the country. who knows what he'll do next, kell. i'll he keep you posted. >> i'm sure you will. thank you so much, sue. our sue herrera. are you better off in stocks or bonds in this uncertain environment? that's next. and t-mobile ceo john ledger, you won't believe how he is responding to a nonprofit

critical of his company's binge on plan. coming up on the "closing bell." on tv working with canines. are you a dog lover, watson? i do not own a dog. but i work with veterinarians. how do you do that? i help them analyse over one hundred thousand pages of medical studies. that's great... 'cause they can't exactly tell us what's wrong with them. isn't that right, rusty? rusty. who is a good boy? who is a good boy? you are. yes, you are. watson, i think you need to work on your dog voice.

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as we finished out the week, the trading week, the first of the year with the dow down 167 points, s&p down 21, nasdaq down 45. key weakness in indicators like the transports had a difficult go of it again, the small caps, there were very few place toss hide in this market, the worst start to market than we have had in a long time. wti below $33 a barrel today. with the dow posting the worst tart start of a year ever it's not unexpected retail investors are on edge. more than $8 billion was pulled from equities this week, that's the largest inflow in 17 weeks, the investors seeking a safe haven in bonds. this is a smart move, for more let's bring in retail investor david meyers along with shark tank investor kevin o'leary. david, is this rotation the right one, people getting into bonds here? >> for me i'd like to buy this. with all the production that's

going to be coming off, the rig counts down i want to buy oil. bonds are a little boring for me, i'm investing in oil. >> kevin, what do you think? >> the oil trade is interesting, catching the bottom seems to be impossible right now and seems to want to go to probably $25. buying a company like exxon or chevron which has a spectacular balance sheet, the theory is i'd rather own the equity because i think they are strong enough to buy all the bankrupt assets from the companies that will fail over the next two years. oil under $40 is basically impossible to service on the debt side from any company. the big guys with good balance sheets will end up owning these assets and getting these reserves and playing back oil i think on the big balance sheets is doing to be the way to go. meanwhile, which is most important for me i'm getting paid a big fat juicy dividend owning chevron and exxon. >> the key rotation we are talking about is investors going

out the stocks in a big way this week and into bonds. is that sound for investors to be doing? >> no, i don't think so. the way i look at it is this, the energy story has made everybody go on edge because watching oil decline every day as an index for the economy is one way to look at it. here is how i look at it, basically now let's forget about the 17% of the s&p that's associated with energy and all the energy service elements, pipe lyons, et cetera. think about this, for the first time in our lives we have the lowest input cost for the other nine sectors of the s&p than ever. this is fantastic for everybody else. i'm anticipation x energy a 5% up on earnings this year. i want to be starting to buy stocks here, again, only dividend pairs for me, i'm a rule-based buyer, you know that, but i think we are going to do better in equities than we will do buying bonds. >> david, you mentioned that bonds are kind of boring to you, i'm sure bonds were also very

boring in the year 2000 when they went on to outperform stocks for ten years. is there another reason why you feel like stocks are the choice either because you have a long time horizon or because you actually think the equity market in the relatively near term is about to turn higher? >> well, let me put this this way, i think we used to love to look forward on oil, we used to love to see what production is going to do instead of what it's doing right now, right now we've been headline risk pricing in our oil factors. if you look at nine months because of the lag time between turning off rigs and production being cut, i like to be in oil and if oil is a big portion of the s&p wouldn't you want to be long equities and long s&p in that case? >> david, would you want to be long bonds here? would you be buying bonds? >> i'm not a fan. i would rather be buying the equities and the outright commodity itself. >> all right. we'll leave it there. gentlemen, thank you both. >> thank you so much. >> david meyers and kevin

o'leary today. do stocks tend to come back after big january selloffs? that's next. plus t-mobile ceo john ledger staunchly defending the company's binge on system. a nonprofit asked the executive about binge on, got a heated and profane response. we will talk to a member of that organization.

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that does mean something, it means it's the worst start to a year ever. history says the bulls could return in force next week, seema mody has more for us now. >> that's right. it was also -- we also saw a 5% drop in the s&p 500 this week, the worst start to the year, the question is what happens from here. according to our data partner the s&p 500 has only dropped more than 5% in five days 26 times in the last decade when such a decline does occur odds favor a rebound over the following five days. the s&p 500 posting an average gain of 1.3% and is positive 63% of the time during the next five days. the top stocks following a 5% weekly route are focused primarily on commodities. followed by consumer and discretionary. for more on this story head over to cnbc.com/pro. thank you, seema. with the dow off to the worst

start ever historically what will it take for stocks to do this, to rebound next week and beyond? joining us on the phone is jeff kir sh. thanks for phoning in. we skidding you would be the go to guy on this. give us context around the key compliance and the likelihood of a rebound. >> this is the worst first five days in the s&p since 1930. we've got serious situations, bear markets, so it's a little different than we are right now. the question remains is it just an exogenous driven thing by china and some of the violence around the world or is there some systemic issue in the economy and that's not exactly clear right now. i'm not convinced that the u.s. is so affected by everything in china. >> jeff, mike santoli here. i wonder if there would be difference in looking at these results of similar periods if it were just any five-day period when we lost 6%. in other words, do we typically also see a rebound or it would be a relatively similar study do you think? >> i think these are the most

crucial five days of the year in conjunction with what happens for the full month of january, january barometer that will be the real deciding point for us, we have had the santa claus rally not show up, the market continue to be hammered here. so i think it's very crucial that it's these first five days of the year, not just any five days or week of the year. >> jeff, it's evan newmark. you say january is so important because there is a january barometer measure. is this because this is the way fund managers tend to look at the year, it kind of sets their minds in order or why is january important at all? >> that's one of the main reasons. the other is the lame duck amendment to the constitution that brings new congresses convening into january, it used to be 1 months later, there is inaugurations and state of the union addresses. not just fund managers but politicians, everybody is looking to the leaders of the countries and the world and the fund -- and the funds to what they're thinking and where they're laying their bets and

what the initiatives and agds are, that's why the market is not real pleased with what it's seeing. if we can rally for the rest of the month that would be a great sign. if not when we look at our indicator fry if he can at that of the santa claus rally and five five days of january prompter all being negative that's not a great sign for the market. >> david darst was here earlier, he was saying, hey, you know, as goes this week, you know, almost 90% of the time so goes the rest of the year. what to you is the real significant period before we start talking about dictating how this year turns out? >> the whole month is more significant because it's a longer period of time, you don't have something where you have a fed rate move like in '01 or you have, you know, a war beginning in 1991 in the gulf. so having that 30 days or that 21 trading days or so gives you more wiggle room for not some one-time event to change the course of the market. but we don't just look at one thing. weighing all three of these

together, plus we breached the december closing low plus the economic issues, even though the jobs number was pretty good today. we look at all those things and a down january would definitely be -- turn us a lot more negative than we would be right at this moment. >> thanks for joining us, jeff. >> pleasure. thanks for having me. >> a lot at stake for the next several weeks. now donald trump is at it again, just days after china's rattled world markets he has a new plan that could launch a trade war with the country. details of that coming up.

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welcome back. t-mobile still under scrutiny since launching its binge on campaign. several outlets including youtube have raised net neutrality concerns. in the latest episode nonprofit digital rights tweeted the ceo asking does it alter the video stream or just limit its bandwidth? to which ledger responded with a video tweet. >> what binge on -- it includes a proprietary technology and what the technology does is not only detect the video stream but select the appropriate bit rate

to optimize to the video -- the mobile device. that's part a of my answer. part b of my answer is who the [ bleep ] are you anyway eff, why are you stirring up so much trouble and who pays you? >> well, ledger later tweeted let me be clear. i know who the eff is. i'm sure they do a lot of great things for consumers but innovation can be controversial. this is not a personal campaign against eff. he continued, it's simply a topic in a broader conversation about consumer choice, which i'm fighting for. joining us now is jeremy galulo he is a staff technology at the electronics frontier foundation. must be interesting inside those halls today, jeremy. what is the point of the comment that you initially made about t-mobile's binge on program? what is the concern? >> the concern -- the comment -- the reason we asked that tweet was we wanted to get a clear answer on whether it was t-mobile doing the optimization or whether they were just throttling video and hoping that the servers who send the video are doing the optimization.

>> and why does that matter? >> it matters because for big providers like youtube automatically changing the bit rate, making sure that the video streams smoothly is not that hard, but if you are a small mom but if you are a small mom and pop website and you host the video yourself, you may not have the technology. if you are trying to reach t-mobile customers, your video will stutter instead of streaming. >> and you are one of the people upset about what t-mobile is doing, but it is not you tube that is the issue, it is the smaller viewer that might be loading and i might not be able to see it and that violates net neutrality? >> that is part of the issue. but it violates the idea that t-mobile should be honest with customers and but with the rest of the internet about how it is managing its network. if you don't know how they are managing the network, you don't know if i need to adapt the bit rate on my video to reach

t-mobile customers. >> what do you make from the response from john ledger. >> he does know who eff is. and i take him at his word. i think we are both fighting for the users. he has a slightly different idea of what customer choice really means. >> i guess, is there a way to accommodate both sides here. if you are somebody in his play, you want to expand, his customers' access to these things at a good price, is that a way to have that happen and satisfy everybody involved? >> i certainly think so. i think the biggest thing is just, in terms of making binge on opt-in, instead of opt-out. he talked about customer choice but then made it the default for all of his customers. the better way is to give the customers the choice. look, if you want this service, it benefits you, this is less data, here is how you turn it on. >> evan? >> i think he is a very clever salesman and knows how to get good press at all times so

probably gave that video tweet very deliberately in closing whatever words and exclamations that he did for a very deliberate reason. >> for maximum. >> he is like the mark cuban of the telecom industry. >> do you have any underlying concerns? >> the question is whether or not the product is as advertised. is it delivered -- because in this life as we know, nothing is free. there are trade-offs for everything. and they are asking him, what exactly are the trade-offs for the offer you are making. and nobody really knows. >> and i thought it was interesting, jeremy, the only thing he would do to placate you is to make everybody opt in or opt out. and it reminds me of overdraft fees. but if people opt in, does eff have problem with. >> that is that a good move in the interest of consumers? >> there is a second part to that besides the opt in which i

think is being clear about, what we've talked about, what is happening and what t-mobile is doing on their network. that point i think everybody realizes it. t-mobile is calling it optimization even though everybody knows that is not what it is. and getting yoond that, i think we could have a lot less of a problem. and then we gets to zero rating and things like that. but certainly making it opt in and being clear about what is going on is a huge first step and allay a lot of our concerns. >> so what really is going on here. as we've seen in the past, t-mobile has been at the frontier, pushing for contract-less plans or reimbursing consumers, the tactics not with standing, they have caused change in the industry and what happens if others are forced or choose to follow suit? >> i think that essentially, if everyone started doing the zero rating thing, a key part about that makes this zero rating better than what at&t does or

what verizon doesn't is here they open it to anyone at no cost. and at&t and verizon have these -- these programs where you could pay them for data from your server to be sponsored and that is something we definitely have a problem with. >> you have a problem with paying for data. say that again? >> so we have a problem with companies paying for the data from their servers to become free for users. >> right. it is a complicated world out there, jeremy. >> no question. >> to resort to some of the tactics that he z. cuts right through it all. thank you for joining us for explaining what is going on. jeremy from the electronic frontier foundation. >> that is why it is called the frontier. when you are at the frontier, like space. >> is there a song that will go along with. >> that it was my star trek reference. >> space, the final frontier. when you are at the frontier, it always gets tricky. >> thank you. >> just reiterating that. >> donald trump unveiling one of the ways le make america great

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welcome back. in case you missed it, donald trump has an idea about how to fix america's trade imbalance

with china. he said, as you could see there, the only power that we have with china is massive trade. i would tax china on products coming in. i would do a tax and the tax, let me tell you, the tax should be 45%. mike, thoughts on this one. >> the tax would be 45%, paid by the american people buying those products. so if he is all for that -- >> then, great. >> so put it to a vote. >> to paraphrase now, let a thousand taxes bloom, along with a thousand ridiculous stupid ideas. the whole thing is so dumb, it probably has some real populist appeal, but it is crazy why. >> and let's look at peggy noonan's policy, with him continuing to be atop of polls suggest people aren't taking seriously enough the appeal of donald trump. she says, i do not understand the inability or refusal of

republican leaders to take him seriously. they take his numbers seriously, as jed said, that his support is about anger, angst and theatrics. that is part of the story. but the other more consequential part has to do with reel policy issues. and in other words, he is tapping into something, and say what in the world, but it turns out that something people believe they want to hear. >> that is the way sort of populist politics works. and on the face of it, nobody goes why is this a problem. but when you actually burrow down to see what the real policy issue is and somebody -- that toy that they were getting their kid for christmas has just tripled in price, all of a sudden, they are like, wait a second. >> they won't take it seriously until votes are cast and not in the same election cycle. this is for next time. if they have to tack in this direction. >> and i know we have to go.

what is the right kind of policy to get at the same kind of agreements. >> it is very tough. because it is the same kind of worker, empowerment talk that hillary clinton has right now. >> they have a lot more in common than you might think. we have to go on "closing bell." thank you for joining me. evan and mike wrapping up the week that was. "fast money" begins right now. live from the nasdaq market site in new york city, times square, this is "fast money." i'm melissa lee. our traders on the desk. tonight on "fast," a lot of people are making comparisons to 2008, including us, but there is another year that is more similar to this week's carnage and it could be a good thing for your portfolio. we'll explain. plus, in a year from now what are the four stocks you want to own. the stocks that could hold up despite the volatility. and later, if you lost money on apple, fear not. we could get your money back for less than a buck. but first we start off with the market stocks getting