8:00 a.m. at twitter headquarters in san francisco. 11:00 a.m. on wall street. and "squawk alley" is live. ♪ ♪ welcome to "squawk alley." for monday, joining us as always, john fortt, kayla tausche and myself. watching the selloff. ed lee joins us. good to have you this morning. >> thanks. >> markets had a difficult time from the get-go this morning. nasdaq down. s&p down to 1843, the lowest since january 20th. where if you recall, we had that intraday low of 1812. and they were watching this halt

of chesapeake, the second today. bob pisani on the floor. >> this is different. i'm in front of the host for chesapeake. this is news pending. recall earlier, these were halted for volatility. that is intraday volatility. and that's sort of a mechanical halt that happens. this is the news pending, so we'll find out what, if anything, the company might have to say at this point. i just want to mention what's going on with some of the overall market right now. because we're sitting not far from the lows for the day here. sectors in terms of the declines we're seeing, financials, consumer discretionary, tech and energy. and, of course, utilities down a bit, but not down nearly as much. it's been a remarkable time here. i want to put up some of the financials and show you. we're having rather notable declines, including morgan stanley and bank of america, some of the money center banks, weaker, 4 or 5% than the overall market and regional names, but not nearly as much. i've also opinion been pointing out since thursday or friday,

consumer names weak, as well, home depot and starbucks. nike down about 12% in the last four or five, six sessions here. under armour also down. this is similar to what happened on friday, as well. i also want to note that the utilities are continuing to outperform. your coneds, duke, southerns, all doing better than the overall market and all up today. of course, these have been beneficiaries on the wave of investor uncertainty and the ten-year treasury yields have moved to the down side. all of the utilities have been big beneficiaries and there you see a move on the up side for them. for the year to date, they're double digit gainers for most names. i don't usually talk about utilities, but it's rather remarkable when you have 13% increases in con ed and chesapeake and duke. southern also doing well for a year-to-date double digit gains here. so a sign of investor anxiety you're getting these enormous outperformances in the utilities. even companies that with modest

dividends yields have been strong. a good example are water companies. i don't normally talk about american water works or rocco america. these are small companies. but they're also up. up -- most up today. and they're up notably year-to-date. and they're modest yields, only 2%. not nearly as good as others. the utilities typically pay 3 or 4%, but some are moving into those names, as well. finally, the telecom stocks i've wanted to mention for a while. they are down slightly today, but at&t and verizon, last week and this week as well outperformers. at&t up 6%. verizon up 8%. these pay healthy yields, 4 or 5% dividend yields for both of them. so that's been a notable outperformer. and by the way, you think it doesn't matter if you compare the dividend payers and telecom stocks to the nondvd payers, the sprints, t-mobiles and u.s. cellular. they had notably poor

performance overall on the year compared to their dividend-paying brethren. so right now dow sitting near the lows today, down 341. still news pending on chesapeake. i'll stand here and see if we can find out the news and get it to you as soon as we've got that. carl, back to you. >> bob, thank you very much, bob pisa pisani, on the heels of friday's punishing session, especially for tech stocks. and the nasdaq this morning, ed lee, is 65 points from what we would call a bear market? 20% off the highs? >> right. >> things like linkedin, yelp today reports tonight they're not helping. >> linkedin was interesting, because despite the fact they had lower guidance, what caused the selloff. you also saw their user growth also slowing down a bit. i think that was the bigger sign for a lot of vesters, the way it had been for twitter for so long. what's interesting, social networks in general, i think at least in the u.s., you're getting a sense of a bit of a plateau, starting to tap out a bit. facebook has been able to grow,

because they have been doing it internationally. and linkedin, twitter, social media company x, whatever it might be, they need to find growth outside the states, so that's where the gap is. >> there's been this propensity all year to sell winners, and buy some of the stocks that have been beaten down. linkedin among those names that have been winning, and we saw that as soon as they stopped winning, investors just threw in the towel. is that going to keep happening or do you think linked in was so overvalued, it had been a long time coming? >> i think it's cheap now anyway. i think, frankly, the way i see it, twitter, for better and worse, set the narrative. social media stocks, tech stocks in general, when it comes to user growth and that narrative. people are paying that much closer attention to that. that is the fundamental for a lot of tech companies, web companies, basically, whether you're a publisher or, you know, sort of an account-based servli that. >> what is happening in tech is extreme, more than the overall numbers. you look at the nasdaq down

2.6%. i look at my screen, yelp down more than 11%. you know, at last seen, down 10%. workday down 8.5%, near the levels where it ipoed, there are some pretty extreme action happening here. i'm not convinced that linkedin has stopped winning. it's different from facebook. its user growth numbers have fluctuated. it's trying to grow internationally and also trying to simplify its app and process, actually pare down the number of page use to make the experience better. they're house-cleaning. i'm not sure that investors are being that discriminating about how they're punishing and whom they're punishing. i wonder if there are deals had been had in this market. >> that's a great point. i agree, actually, that fundamentally companies at linkedin are doing perfectly fine. i don't think they're sort of crawling off a cliff any time soon. i do think there is heightened scrutiny among investors in the sense that if there is any arbitrage i can exploit here, this tiny little miss, i'm going to try to own that. just because the way twitter has

been acting lately, at least among the investor group, i think that's sort of the weird feedback group we're seeing with a lot of companies. >> and layered on top of that was this controversy over the weekend. users erupted over the weekend after this buzz feed report showed the company was moving to an algorithmic feed like you would find on facebook versus that purely chronological feed, #riptwitter trended nationally for the weekend, and then jack dorsey took to twitter to respondent. quote, i want you to know we're always listening and never plan to reorder time lines next week. next week. >> that's the specific qualifier. not next week. maybe the week after or month later. look, i think this is overblown, right? i think there's nothing quite like the twitter community to respond to twitter changes, so it sort of heightens the reaction. part of the reason why they're reacting so strongly, what defines twitter is the real-time nature to it, which is why, you know, if you're within journalism, in news media, it's a great medium for us.

it works well that way. you want to see what's happening at the moment. super bowl yesterday. that's -- twitter is a great medium for following along. the water cooler talk. you want to see what people are saying, given what's happened. >> this drives me crazy. what also defines twitter is being clubby and esoteric. >> crowd party. >> exactly. so change it, jack. go ahead, do it. mark zuckerberg does this all of the time, looks at the data, figures out the core product needs, makes the change. yes, he tells the community, we hear you, blah, blah, blah, but hey, we're doing it anyway. separate app for facebook messenger. by the way, the growth was huge after that. you've got to have your convictions and change, especially if you're twitter and you haven't made enough changes. >> yeah, and every single facebook change to the feed, to the app, was met with criticism. but the company rested on the fact they think they know more about what you want than what the user can actually say. that they want. and they work almost every time. >> and continue to grow. and i think that's sort of the slippery slope with any of these

networks which is the community versus the company, right? i think the community, they own it so many ways. you can't let them control it either. i think you're right. there is a clubby aspect to twitter that makes it harder to grow outside the weird elite group that likes to use it. it is an esoteric medium. >> they call us weird and elite? >> guilty. >> but we're not enough to support an entire platform, the four of us. by the way, adam bane, twitter's president and coo joins us at 10:00 a.m. after they have earnings wednesday night. be sure you tune into that. lastly, the winners and losers from the ads in the super bowl shaking out. a number of tech companies buying ads from t-mobile to amazon. go pro, fit bit. super bowl ads generated 476 million views, and that was just online, according to ispot tv. a lot of startups. >> a lot of startups. and you know, i think that was always -- historically, since 2000, online companies and internet companies took advantage of the super bowl

eyeballs, let them know we exist kind of a thing. now it's sort of regular, right? internet companies are like any companies. you want to be out there as a commodity, as a player. i think that's part of what we're seeing. >> but if you're dollar shave club or sofi. dollar shave club is below $1 billion. sofi, $4 billion. >> $5 billion on a 30-second spot? that's a gamble. a lot of internet companies generally don't do marketing or spend money on marketing. viral word of mouth is what they rely on. they're going to make a standard ad play and they'll do this one and one a year, maybe, whatever that is, and hopefully last them through. >> i have one question about the mood in the valley. and that is, after all this pain, after all this talk about twitter, maus in general, super bowl aside, is there a sense for all those who saw this coming? the bill gurleys of the world, waving flags on valuation? are they now saying, "told ya?"

>> i think it's a good question. bill gurley is still the outlier. very boosterish, bullish, strong, don't worry, it's going to be fine, not like in 2000 or 2001 or 2008 in the recession. i think they still have a lot of confidence, despite everything. got to wonder about that. yes. >> i keep hearing that the mood has changed, though. i wonder what happens over the next quarter, as some of this starts to sink in. some things that happen in the valley filter up to the markets. some things that happened in the markets i feel like filtered down through the valley. people would argue with my up/down there. but when it comes to money and kind of money-driven changes in mood, i don't know. >> yeah, deal flow starts to slow down. that's going to have a direct effect on your sentiment, right? i think there is an up/down flow, you're right. but also this weird wall that happens. whatever the negative sentiment might be in terms of numbers and

money not coming in, it hits a wall and doesn't filter down into the rank and file. and you know, why do i say rank and file, that's where the entrepreneurs and start-up ideas come from. some mid-heavily engineer hooks up up with an investor. i want to do this startup. they still thrive off that idea, that conceit. they need to live by it. >> but a lot of startups are being told to cut their way to growth. there needs to be a path to profitability. >> that's real. >> does that change the sentiment for people considering going to private companies over, say, employment out of big, stable, public company? >> you know, talent sort of migration is an issue out there. at the same time, they like to believe and you know, i want to hit it rich and big. >> that's how they pay their employees, the promise on getting rich through equity. that's a tougher sell right now. ed, we'll talk more later. >> sure. >> meanwhile, we're still watching a dramatic selloff in the markets, again, following the dramatic selloff we saw on

friday. dow down by 376 points, two and a third percent. we're keeping a close eye on the nasdaq. 41.85 marks bear market territory down 20% from the high it hit in july. carl? >> when we come back, the selloff in tech the focus this morning. we'll talk to a tech portfolio manager. cloud companies feeling the pain, amazons, microsoft, sales force down 10% in just the last week. and which brands won the super bowl ad wars? bitly measured the response, and will join us later with some results. session lows down 376. back in a moment. i'm here at the td ameritrade trader offices. steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second.

you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. td ameritrade.

tech sector getting clobbered this morning, nasdaq down 3%, even after suffering its worst day since september on friday. the nasdaq inching closer to bear territory, down almost 19% from its july intraday high. so are we nearing a bottom in tech? walter price is a tech fund portfolio manager at allianz global investors. good monday morning to you. >> thank you. >> walter, it seems to me that this is a little bit different than even just the raw percentage overall would suggest. i see a lot of names that are down more than 6 or 7%. what's going on here, and as

certain stocks start to trade near the area where they went public, is it time to buy some of these? >> i think it's still a little early, because i think you need to get the guide downs or the inputs from the companies on how their business is dealing with this more difficult economy before you can see the stocks bottom. you know, if you look at past bear markets in 2008 or even 2011, i think you needed a couple guide downs from the companies before you could say i think the bottom is in. so i -- you know, i think you need to have many of these companies that are yet to report to talk about how they're handling the slow down and what their plans are before you can go in and buy the stocks. >> so we saw something similar from are cognizant this morning than what we saw from linkedin last week. and linkedin got absolutely

clobbered, down more than 40% after it reported a weak guide. but it was taken down to 2012 levels. does that sort of punishment for the stock make sense to you, based on what they reported? >> well, i think linkedin had a very high multiple. it still has a very high multiple. so, you know, i think the higher your multiple, the more vulnerable you are to a guide down, because your multiple is based on the growth rate, and so if you take the growth rate down, then people's estimates of earnings in 2018 where they're probably valuing the stock have to come down a lot. so i think that was what happened with linkedin. in the case of cognizant, you have a lot lower multiple, so expectations are lower, growth rates are lower, and so you know, moderate guide down in their growth rate from 14% to 12% at the midpoint is still, you know -- it's still going to cause the stock to go down, but not as much. >> even so, walter, the

comparisons to the internet bubble of the early 2000s are starting to come back to the floor this morning with "usa today" and "fortune" but fortune writes, this time tech isn't the problem, it's just party to other problems. do you agree with that? >> yeah, i think in -- i think in 2000, you had a lot of companies valued on sales, and they weren't really making money. they had models about how they could make money, whereas i think many of the tech companies, even the high growth tech companies now are generating free cash flow or operating cash flow, and so, you know, they're a lot closer to valuation metrics that you could put traditional pes on or price to cash flow on or numbers like that. >> so walter, really quickly, you talk about these guide downs. we've gotten a few guide downs. i'm not sure whether you're talking about you're waiting for earnings season to come to a

close. also, a bull might try to argue at this level that dollar moderating, buybacks returning, might lend some support short-term. why don't you buy that? >> because i think that it's just too early. i think that, you know, what you have seen is companies say, oh, you know, business is a little tougher in the fourth quarter, and we're guiding conservatively in the first quarter. but you know, the stock market is a leading indicator of corporate business. and so, you know, i think business is probably going to get a little bit tougher. and so i think you have to get that in expectations. you would like to see the company say, you know, business is tougher and the stock not going down 20% that day, before you feel confident that expectations are at the right place. >> so walter, is there blood in the water? i look at microsoft. it's down to just october levels, where some other companies who operate in some of the spaces, where the microsofts of the world are looking to grow. they're down at levels where

they were two, three years ago. are we going to start seeing m & a off this action now that some of those stocks are cheap? >> i think we could start to see some m & a. i think that, you know, as i look at some of these high-growth companies, if i look out over two or three years, i can see quite a bit of appreciation in their stock prices and i think that companies that kind of missed the cloud or missed some of these sas markets will start to look more seriously at these companies as they get pushed down. >> all right. walter price from allianz, thanks so much for joining us. . >> thank you. chesapeake remains halted, but is that what the statement saying currently no plans to pursue bankruptcy and addressing reports about retaining kirkland and ellis. david is back with that. >> we'll be dealing with these kinds of situations perhaps more often in coming days and weeks when you're dealing with

companies that have as much data course as chesapeake does, carl. but to your point, the statement saying they've worked with kirkland and ellis since 2010. they continue that being kirkland and ellis to advise the companies that seeks to further strengthen its balance sheet. but as carl said, chesapeake currently has no plans to pursue bankruptcy, for all value for all shareholders. it is the second largest producer of natural gas in the country. 12th largest producer of oil and natural gas liquids. it has, oh, over $9 billion in debt. it's got about 1 .7 billion in maturities due in 2017. it suspended its dividend on january 22nd and does have half a billion in maturities coming in march, which has focused people on its balance sheet in the last couple of days. certainly this morning after there were reports on friday that it hired kirkland and ellis or kirkland and ellis was

reviewing restructuring options for the company number of other reports echoing that. hence, chesapeake coming out with the statement, giving us a little more clarity. we'll see if the stock actually perks up after being down 50% when the news halt came. >> but the company's debt has continually been downgraded by s&p, twice in the last month. david, you would think that debt is going to be continually under review as they pursue some options. >> yeah, as the price of the underlying commodity comes down, whether it be natural gas or oil, their ability to meet their interest payments certainly is in question. again, they say they have no plans to seek bankruptcy, but to your point, kayla, many people have been focused on chesapeake, as being in a difficult position for some time, given the debt load that the company has, and those down grades, which i'm sure we're going to see more of for other companies, as well. >> we're going to continue to watch chesapeake stock still currently halted. more on oil prices breaking

down this morning, breaking through $30 a barrel. we're still watching that. and we'll countdown to europe. greece hammered again today. european banks also lower. we'll have that close and a wrap-up of trading in a few minutes. ♪ okay, so you launched your bank's app. now what? how will you keep up with the new demands of today's digital economy? the fact is: some believe they won't need a traditional bank down the road, so at cognizant, we're helping banking and financial services companies think digital, be untraditional, and reimagine what the bank of the future can be. our clients can now leverage customer intelligence to predict their financial needs and provide more contextualized products and services. we're creating new platforms across channels so customers can effortlessly invest, borrow, lend, transact-wherever-whenever they choose. and we're digitizing the way banks run,

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we are currently watching the post where chesapeake energy had been trading earlier this morning. the stock fell 50% on a report that it had hired restructuring efforts at kirkland and ellis. the company recently came out with a statement it has, in fact, been working with kirkland and ellis since 2010, but has no plans to pursue bankruptcy. we'll continue to watch that stock, which will in all likelihood move from that statement as soon as it opens. we're also keeping an eye on the oil market. some slippage, but hovering still above $30 a barrel. jackie deangelis, what can you tell us? >> good morning, kayla.

that's right, we are see sawing around this critical level of $30 a barrel. we will fell under $29, $29.50 for the intraday oil. we had a recap last week, can't seem to move the needle higher. maybe we could see an emergency meeting maybe some cooperation. this is not holding things up here. the most recent conversation among analysts is this issue of why production isn't falling in the united states right now. they're saying the feeling is that it's more worthwhile, more cost effective for u.s. producer to continue to keep their wells up and running, reduce their cap x expenditures further out, but keep those wells up and running rather than shut them and try to reopen them later. that cost them a lot more. having said that, traders are saying we could see those lows of $26 a barrel that we touched a little bit earlier. in january. and the general bias right now is that oil prices probably will be neutral to down if we don't

see some sort of a change. i do want to draw your attention to gold, as well. this is something that we're seeing today. we haven't seen in a long time. a near $40 pop in gold prices, based on this sort of safe haven trade that has been out of favor. it's a little bit the fed, as well. i do want to highlight that with treasury yields so low now with risk coming off out of equities, out of oil, a lot of people are piling into gold and not necessarily short covering here, but buyers getting into this market. hedge funds, i'm told. the intraday high today, 1199.7 1199.70, we didn't break through 1200. if we do, that would be significant from the technical perspective. we haven't seen that since june last year. >> jackie deangelis at the nymex. >> this is horrible from the market. look at the detail, greece down over 7%, italy, 4. spain, 4. this is horrible.

it's very broad based but the banks seem to be front and center and bank credits, all of the concerns we have spoken about with growth, where you're going with energy. and they changed the rules in europe so they can bail in senior creditors or bond holders in any restructuring in an environment where the ecb kicked off the year by letting it be known they were going to stalking around, looking at nonperforming, which they thought were $200 billion. but clearly maybe more than that, given what the world economy is doing. into that, you also have some of these high yield loans or cocoa bonds on deutsche bank and some of the spanish banks, as well. which were high yield and never quite profitable, which people are selling. and the credit default swaps, the cost of insuring bonds on banks. it's also rising quite substantially. so it's nowhere near like it was in 2008. or 2010. but nonetheless, it is worrying and you can see the reaction on these. these stocks that had already been beaten down. that's some of the major banks

around europe. the uitalian banks look to consolidate way after they should have done and obviously a lot of concerns locally about the industry in the bond market there. to give an idea where we're trading now on both the indices, europe and also the banks, we're way below where we were, what is this year-to-date? i was going to say, this is where we are year-to-date. so the stocks 600 over 8% and the banks have done even worse. they have loss a quarter value. meantime, into that whole mix, because of the link -- we used to have a link between banks and sovereign debt. you also see a race to safety for treasuries for the u.k., for france and germany with fixed income. there is a slight selloff emerging within portugal and italy and the rest. you see this spread between the portuguese and german bonds. finally, let me conclude by showing where we are in spain.

and there you will see the spanish banks followed us into negative territory. it's kind of a mix negative picture. guys, back to you. >> we'll talk about the banks in europe for a while, i have a feeling. thank you, simon hobbs. we're keeping an eye on chesapeake, expected to reopen any minute. let's get more on the selloff, director of floor operations, art cashin onset. you have oil down, you have europe fallingot of bed. but shanghai closed. where is the relative stability? >> that's part of the problem. this whole european thing, about 4:00 this morning. people started speculating on the problems with the banks. and the german dax fell out of bed, and you're futures which had been better, fell out of bed with them. and we can't get out of our own way. simon talked about the bail-in aspect of the banks, and that can be a little bit of a

smoldering fuse here, because if you've got your money in a european bank, and if they have trouble, and you're going to have to lose part of what you have there, as part of the bail-in, your response is going to be to take the money out. so they -- the ecb could accidentally be dancing with a little bit of a run on some banks here. >> is the fear around the banks founded at this point? is it because they have too much exposure to energy, to emerging markets, or that they just haven't had the equivalent of ta t.a.r.p. to get the bad loans off their books? where is this coming from and why now? >> it is the idea of contagion, and you started with the middle of banks in january. and they said they had more nonperforming loans than they thought. so then they started leaning on them. today was greece's it turn in the spotlight. they're going after all those club med areas again, fearing

that you might wind up with either a run on the bank or one or two banks folding. and after what we saw in 2008, people are desperately afraid of con page tagio contagion. >> art, i want to toss to bob pisani on the floor with chesapeake as it's reopening. bob. >> it just reopened. 206 was the open for that. and remember, we dropped down to as much as 151, halted for news pending, on a volatility before. this time it was news penned. they had no plans to file for bankruptcy. just reopening here. quite a move from the up side, 151, i believe the last before it was halted and just opened at 206, now trading at 2.16, and very, very big trading here. 56 million shares in chesapeake. multiple times the normal amount that you would get right now. so as of now, no more halts for the moment, up $2.15. back to you. >> thanks, bob. art, when you look at the chart for chesapeake and what we have seen in oil over the last year,

there was this idea that we weren't going to put a bottom in oil until we saw a high-profile poster child for this selloff. is chesapeake it? >> well, unfortunately, it could be. they've -- they were doubling down, even though the price of natural gas was going down. and that's why they had their chairman separate out, and they have had some problems since. they were borrowing money to buy the rights to more properties. and so they have a bit more exposure than everyone else, at least for now. >> although if you want to see oil climb, you are going to -- you're rooting for some stories like this. >> well, yes. you want to see the supply get cut back. you also -- oil was under pressure, because barrons ran a front-page article that we're looking at $20 oil. now, the old story is, the curse of the front page. does that mean we're not going to get anywhere near $20 oil, we'll wait and see how that

comes out. >> how does yellin synthesize this on wednesday and thursday? >> well, i think stanley fisher's influence will remain. so she will try and say we're data dependent. right now the data looks skimpy. although the wage data looked good. so we won't take march off the table. i don't think anybody believes that the markets are storing at a 10% chance of them actually going in march. and a -- just about a 50/50 shot we'll do it at all in 2016. >> is there anything on the calendar that would put risk back on? >> well, you have two very important women speaking this week. you're going to get yellen testifying twice. and merkel is going to speak twice on the same days. not to that topic. but the immigration thing is getting a little wacky, and this is carnival going into mardi

gras, and colon is moving about the migrants. >> we're going back to bob pisa pisani because chesapeake is halted again. what can you tell us? >> this is one of those things that happens when you get extremely volatile days and a quirk in the way the circuit breakers are set up. remember, they'll kick in if you drop after 9:45 more than 5% in a rolling five-minute period. and they will also kick in on the other side. they'll halt on the up side if you move more than 5% in a rolling five-minute period. and you can see chesapeake moved very quickly from $1.51 and now you see $2.21. this is one of the problems, i think, that you have on very volatile stocks with the virkt breakers. and it argues for the idea, and getting technical here, you ought to sort of widen the bands out for these circuit breakers. the whole idea is, you don't

really want to halt stocks. everyone sees the stock as moving up, because the company made some comments in response to some rumors around and the stock is -- should be allowed to basically run. this is my opinion and the opinion of a lot of people out there. right now, it's one of these anomalies about these circuit breakers. you're halted on the way down, you get news from the company, the stock moves back up and you get halted because the circuit breakers don't allow you to do that. we should be moving back, opening very, very soon here. they're already posting some indications, which is the sign that they're getting ready to reopen those. i'll stand here and let you know what the price is. remember, the last was $2.21, probably going to open higher than that. >> all right. thanks so much, bob pisani. on the floor. art, thanks as always for coming by. >> my pleasure. >> live television, breaking news always keeps it interesting. and coming up, cloud stocks showing the pain. why names like sales force and workday down big, each more than 20% in the last week. we'll be right back.

good morning, everyone. i'm sue herrera. here is your cnbc news update. north koreans celebrating their controversial long-range rocket launch with a parade and fireworks display. thousands of pyongyang citizens, soldiers and government officials attended the rally at the capital, but the rest of the world is denouncing that launch as a missile test. thousands of syrian refugees gathering at the country's border with turkey after fleeing

the russia back to government offensive in the city of aleppo. trucks with humanitarian ada arriving to help aleve their suffering. protesting french drivers' move to paris city center after disrupting access to the airport for a few hours. the protests come amid tensions at app-based car services. and toyota has stopped assembling cars at all plants in japan. it comes in the wake of an explosion at its steel unit last month that is has interrupted vehicle supplies. about 80,000 cars have been affected by the production halt. and that is your cnbc news update this hour. back down to "squawk alley" at the nyse. kayla? >> meanwhile, we're watching shares of chesapeake which spiked for trading following its seventh hat halt of this just this morning. but we're getting word it has halted again. let's get back to bob pisani on the floor. >> well, again, you're right. it's halted. let's just recap the wild day we

had. we opened at 2.55 on chesapeake, but a couple volatility halts was halted final for news pending a while ago at 1.50. the company then came out with news pending. indeed the company came out and basically said they had no plans to file for bankruptcy. the stock reopened about seven or eight minutes ago around $2.20 and opened for a couple minutes and then was immediately halted again. so remember how these work. you're generally after 9:45, there's a volatility halt. if the stock moves down or up, 5% in a rolling five-minute period. it's complicated to explain, but the bottom line, when companies come out and make statements clarifying issues, the stock instead of moving down moves back up and will get halted again on the way up. this is one of these little issues we get inside baseball about. but there may be some arguments

they should widen out the bands and obviously nobody wants to halt the stock under these circumstances, just move quickly, because the company had a statement and as a result, we're still sitting halted. so let's just -- i'll stand here for the next few minutes and give you this on the way back up. but no new news at all since the company made its last statement. back to you. >> don't go too far, bob. we might see you in a few minutes. bob pisani. on the backdrop of this, the new hampshire primary tomorrow night. our john harwood is there, bringing us an update on a busy week. hey, john. >> hey, carl. you know, even 36 hours later, the dominant event in the closing phase of the new hampshire primary, at least on the republican side, is this clip from marco rubio in the debate on saturday night when he repeated himself over and over, and then got busted by new jersey governor, chris christie, for relying on that talking point. take a look. >> let's discuss once and for all that barack obama doesn't know what he's doing.

he knows exactly what he's doing. he's taking a systemic effort to change this country to make america like the rest of the world. let's dispel with this fiction he doesn't know what he's doing. he knows exactly what he's doing. this notion that barack obama doesn't know what he's doing is just not true. he knows exactly what he's doing. >> there it is, the memorized 25-second speech. there it is, everybody! >> now the reason that's important is that marco rubio came out of iowa with a strong third place, moving up midweek showed up moving solidly into second. his momentum has been blunted. we now see from pollsters rises by jeb bush, john kasich, even chris christie, who started further back. that's jumbling the race behind donald trump who is a clear favorite to win this tomorrow. and what that means is, it's likely to extend the candidacies of several other candidates, competing with marco rubio for so-called establishment support. now on the democratic side,

bernie sanders also looks clearly headed for a victory. he's double digit leading in all of the polls over hillary clinton. and that's got bill clinton, the former president, on the stump, hitting bernie sanders hard, suggesting his campaign is obfuscating some key facts about his programs that some of his supporters are sexist. he's escalating the rhetoric and the campaign is brushing it off. that shows the temperatures rising as we head out of new hampshire to other states where hillary clinton is presumed to have a stronger base because of the greater diversity in those electorates, more african-american and voters. it appears he'll come out with momentum and we'll see whether she is able to blunt that. >> i'll take it, john. thanks. quite a lot of momentum changes in the political game, at least. and coming up, why the cloud is leading the market lower. first, rick santelli, what are you watching today? >> i'm watching what simon has been watching, the credit

markets, whether it's credit defaults, spreads. everything seems to be coming back to a certain type of reality that we haven't seen since the credit crisis. what happened? how is it going to change? how can we best monitor what credit is trying to tell us? all after the break. the future belongs to the fast. and to help you accelerate, we've created a new company... one totally focused on what's next for your business. the true partnership where people,technology and ideas push everyone forward. accelerating innovation. accelerating transformation. accelerating next. hewlett packard enterprise.

let's get to chicago and the santelli exchange are rick. good morning, rick. >> good morning, carl.

i want you to look at a chart. an april chart, roughly the 20th of april of last year for ten-year boom deals. and the point of that chart i'm trying to get you to focus on, the low yield ever on a closing basis was a little over seven basis points. and that date was the 20th of april, 2015. now the reason that date is important is because all of a sudden, credit markets have energized again. and i don't mean energized in a positive fashion. we're seeing the spreads in europe against the southern economies, widen against the benchmark euro rates which are basically the german rates, and that widening is causing a problem. if you look at credit spreads, you'll see that the southern countries, of course, are zoom, zoom, zooming. so what's the easiest way to get a handle on this dynamic? i thought of an easy way. let's just stick with the 20th and that chart. okay, we settled at po 7.5 basis points. where is the market currently?

higher, moving down rather quickly. but it's at 22 basis points. the ten-year, our ten-year on that date was 189 basis points. we're a bit lower. right off the bat, that is something important, because not only is there a differentiation of credit going on again, between the southern economies and the benchmark high-quality sovereign german curve, but it's also the german curve against the u.s. curve. and how that lines up. 22 basis points is definitely higher. we're lower. let's look at spain. spain was 146, it's currently at 177. france is at 35, it's currently at 60. illustrate at 148, currently at 170. here is some of the areas that are making people nervous. portugal, of course. also greek, also irish. but 2% currently at 340. so how is this supposed to factor into people's portfolios? consider this. the japanese markets for decades

have been unable to purge some of the issues that have continually kept their product activity and some of their metrics lower than they would like. what are those issues? we can put it under the heading of toxicity. things in the system, whether nonperforming loans or problematic positions and markings on securities. all of that seems to have gotten grown over, and we just seem to move on. but you can't wallpaper over live termites forever, because they have a tendency to keep on moving. so the reason this dynamic is important, if you're looking at u.s. rates and you're looking at them under the context that they have been right, they have been on the soft side reflecting the global economic horsepower that we have in the system, this is going to affect it like a turbo-charged engine. we are going to not only have the effect of weakness, we're going to have the effect on the credit differentiation in europe. and that indeed is not only having effect, it's going to

have a greater effect. john, back to you. >> all right. thanks, rick. cloud software companies, meanwhile, suffering their worst single day ever on friday. the pain definitely continuing this morning. josh lipton has that story. hey, josh. >> well, john, in total, the 47 companies tracked by the best venture partners cloud index fell nearly 20% on friday, and that was the biggest one-day drop in its five-year history. many of those stocks are -- again, red right now. take a look at sales force, now down some 30% so far this year. it is one of the worst performers in the s&p 500. net suite down 30% in 2016. much of the recent concern due to the disappointing outlooks from companies like linkedin and tab low software. investigators bailed on a number of software names. still, byron deter, the partner

who created that cloud index, remains a believer in this sector. he notes that cloud companies are cheap, trading at four times forward revenue. s are, they're growing fast, expected to grow sales by nearly 30% so far this year. bottom line, he does not believe that linkedin or tab low commentary signals a broader warning for the entire sector and thinks the selloff is overdone. but deter does say there will be an impact for private startups, focused on the cloud. if this pain persists, the ipo window is frozen shut for now, he says, and late-stage valuations will suffer. guys, back to you. >> yeah, well, it's interesting to hear that. as the nasdaq is about 60 points, john, from bear market territory. >> at a kayla, i've said it before, i'll say it again. cloud -- this term gets thrown around just in general. tab low, not really a cloud company. linkedin, yes, uses the cloud but in a different way than net

suite. i think investors have got to buckle down and think about what are the fundamental technologies here, what are the growth trends that are going to be profitable in the future. you can't just trade on a buzz word that you don't understand. >> tough medicine for a lot of companies, john. and our thanks to josh, as well. when we come back, more on the selloff, dow down close to the lows of the session. "squawk alley" will be back in a minute.

what a morning it has been for chk. multiple halts, some for news, some for circuit breakers. a company from the statement saying they have been with us since 2010. no current plans to consider bankruptcy. the last resumption of trading came from a circuit breaker stopping the stock because it was on the rebound falling. >> despite the company's statement trying to shore up, even at current levels, market company at 1.4 billion is a tenth of what it was just one year ago. >> that's a metric that's beginning to get familiar in some of the commodities spaces. meantime, not quite session lows, but down. 337 and the s&p hanging on to 1840 as technical levels start to be a big piece of the puzzle. finally, earnings remarkable. fox and yelp tonight. coke, viacom, windy, disney,

pane panera, cisco, you name it. >> i think every listing for that calendar-first quarter guidan guidance, seems to be what took down linkedin. what kind of revisions do we get and is it about command in the overseas markets. how much is about currency, how much of it sounds like just cautious commentary? i don't know. you take a look at gopro. it seems to have at least temporarily bounced. does a dead cat, a bottom? >> or is it a major short cover, since about half of the shares outstanding are currently being borrowed by short investors? we didn't mention the licensing deal that microsoft -- >> buried today. >> bart part of it is the reaso the boost. do you think it's tony bates? >> completely meaningless. >> twitter below 15 for the first time ever today at 14.94 or so. they have earnings on wednesday

night. and thursday morning, adam bane will join us talking about twitter growth. r.i.p. twitter, what a hash tag it was over the weekend. let's get to scott wapner and the half. all right, guys, thanks so much. welcome to "the halftime show." joe terranova is here, along with john and pete najarian. josh brown joining us in a few. our game plan looks like this, chesapeake sinking with speculations swirling and the stock plunging. the latest on what could happen next. bio hazard, top-ranked analyst mark shown blaum. stocks lower, dragged down once again by the banks and technology. the dow jones industrial