never seen negative interest ralts, never seen central banks so involved in the market, we've never seen so many things. this is what i call unusual uncertainty. we're going to get to a tipping point and i think that's the main takeaway. it's also happening in europe, not just here. run things at slow growth things start to break. >> all right. >> kayla, thank you. >> i'll be here tomorrow. >> make sure you join us tomorrow. "squawk on the street" begins right now. it's just awfully good that someone with the temperament of donald trump is not in charge of the law in our country. >> because you'd be in jail. >> secretary clinton -- >> a scene from last night's debate. good monday morning.

welcome to "squawk on the street." i'm carl quintanilla with david faber, sarah eisen, mike santoli at the new york stock exchange. we're going to talk about the the debate. futures up ahead of a busy week. german expect data, bond market is closed for columbus day. a contentious debate in st. louis last night, the tone set when both candidates entered the stage and did not engage in the traditional handshake. after that a focus on trump's hot mike remarks in '05 about women that has created turmoil within the gop. >> this was locker room talk. i'm not proud of it. i apologize to my family. i apologize to the american people. certainly i'm not proud of it. >> have you ever done those things? >> women have respect for me, and i will tell you, no, i have not. >> what we all saw and heard on friday was donald talking about women, what he thinks about women, what he does to women.

and he has said that the video doesn't represent who he is. but i think it's clear to anyone who heard it that it represents exactly who he is. >> now, the debate last night did get to a lot of issues that are core to our viewers' interests, namely tax policy, trade, even sirius, supreme court, talked about warren buffett, george sorros, depreciation, carried interest. a lot of debate and post game analysis being overshadowed by the top ten minutes of that debate last night. >> yeah, a lot of vitreal of course. he called her the devil at one point. says she has hate in her heart and said he would put her in jail if he becomes president. also did go after her hard, carl, on benghazi, on the 33,000 e-mails, on speeches she's given to wall street and whether or not her ties there are going to in some way influence her to not go after certain things that she

said she has, mike. so, you know, and she didn't respond a lot, as she didn't in the first debate perhaps to a lot of his provocations. >> that's right. you know, in a different debate maybe the news if it's news that donald trump said, well, of course i didn't pay taxes for all these number of years after that 1995 tax return, but then he seemed to say he's paid hundreds of millions in taxes thereafter. that might actually have made headlines, but i think if you look at the markets and the way they opened on sunday in the futures pop, this was the market's real first reaction to actually price in whatever happened in that friday night revelation, right? >> i was going to say the same thing. >> i think you have this incremental of pricing in, okay, it's still clinton's election to lose. and that happened in the currency markets and the stock markets, at least tentively. >> yeah, because for the foreign exchange market opens around 3:00 p.m., 5:00 p.m., starts getting going on a sunday. and you saw an immediate reaction in the mexican peso. that was before the debate. and the peso surged almost 2%. still down 9% so far this year

on the idea if trump becomes president mexico gets hit the hardest economically. so when you look at the rally in futures, which has picked up steam all morning long this morning, the clinton rally we saw the last time after the debate, this one feels more about the weekend tape because you started to see the market reaction before the debate. the narrative on the debate, i mean, financial times, a lot of other papers are saying after a tough weekend trump managed to stop the bleeding. that seems to be the big sort of headline story. >> you just heard larry kudlow a few moments ago on squawk talking about trump's ability to thread the needle, as larry said, delivering an economic message, a message about tax and trade while addressing the tape revelations for friday night. hard to separate what futures are doing from the race itself. it's a morning of a lot of upgrades on the sell side, which we're going to get to. and of course futures and markets are complex instruments. >> discounting a lot of different things. >> very blurry. the stock market has been in this trading range. we've been kind of trapped here

since july even as the presidential race has been very volatile up and down. i don't think you can basically say that's exactly what's going on with the markets. but incrementally, i think you do have a way to the evidence approach where the market is kind of leaning in this direction of saying maybe they're getting closer to having some certainty about the outcome. >> we also saw oil turn around. it was down this morning. and we have an important meeting going on in energy sort of convention in istanbul where you're getting a lot of official comments. and some of them are comments about how russia and other non-opec producers might actually comply with the agreement with opec to cut production levels. and now we're seeing crude rally 1.5%. we see the stock market at session highs, we were below 50 this morning now we're back above that level. >> right. of course coming off an employment number as well that was a bit below expectations on friday but certainly doesn't seem to have stemmed those who believe we're going to get a hike. >> december. >> before the end of the year. >> yeah, because we saw wage growth. which was good. we saw the labor force participation tick up. and while the headline was

slightly disappointing of 5% unemployment rate still represents a lot of progress. stanley fisher speaking over the weekend in d.c., the imf meeting saying actually september was a close call. and he said to continue to expect gradual interest rate increases. >> for more on the debate last night, let's get to our chief washington correspondent john harwood who is in st. louis. good morning, john. >> good morning, carl. you know, as you guys were suggesting, the context for this debate was a weekend which donald trump was in freefall as more and more republicans came out and repudiated, denounced him, many urging him to quit the race in the wake of that "access hollywood" tape that came out. now, the two campaigns had different strategies going into the debate. hillary clinton wanted to keep that momentum going, appeal to moderate republicans, to women, the college educated voters by saying that we see and have seen throughout the campaign what donald trump's really all about. and he tried to rally his base by redirecting fire to hillary and to bill clinton.

>> what we all saw and heard on friday was donald talking about women, what he thinks about women, what he does to women. and he has said that the video doesn't represent who he is. but i think it's clear to anyone who heard it that it represents exactly who he is. >> if you look at bill clinton, far worse, mine are words and his was action. his was what he's done to women, there's never been anybody in the history of politics in this nation that's been so abusive to women. >> now, we saw exactly the same dynamic when the flashpoint economic issue of taxes came up. she argued that she's only raising taxes on the top and donald trump as republicans have for years said when she says she's raising them on the top, that means she's going after your wallet. >> we're cutting taxes for the

middle class, and i will tell you we are cutting them big league for the middle class. and i will tell you hillary clinton is raising your taxes, folks. you can look at me. she's raising your taxes. really high. and what that's going to do is a disaster for the country. >> people like donald who paid zero in taxes, zero for our vets, zero for our military, zero for health and education, that is wrong. and we're going to make sure that nobody, no corporation and no individual can get away without paying his fair share to support our country. >> now, there was nothing in that debate that suggested that donald trump is expanding his base, though he did rally his base. now, the problem is that he's behind. we have a new survey monkey -- nbc news/survey monkey tracking poll showing him down five nationally, that's before the full impact of the weekend revelations came true. now, donald trump did succeed in

preventing his running mate, mike pence, from quitting the ticket. something that had been speculated on over the weekend. mike pence was just on fox a short while ago where he was -- that institutes a small victory for donald trump, but not one that changes the trajectory of the race, guys. >> so, john, when it comes to the party fractures that we saw over the weekend, the pulling of endorsements from the likes of mccain, the comments from fi n fiorina, condi rice, what do you look ahead? >> i'm going to continue to look at more of those as pressure is put on republican members in close races, they're going to be watching the polls and if they see erosion, they're going to feel more incentive to bolt, also if there are additional revelations which everyone's speculating about but we'll wait and see if they happen, other tapes, other women coming forward and saying that donald

trump did things that he said last night he had not done. all of that makes this a very soft moment where republicans, there's some pressure to leave. it was slowed down last night. but he's in a very vulnerable state with other republicans. and he's made it quite clear, guys, that he's willing to attack those in his party. he put out a tweet yesterday saying he was being attacked by self-righteous hypocrites whose poll numbers and elections are going to go down in defeat. now, that is not a recipe for getting the republican party mobilized in turning out to vote. and it has consequences not only for him but for the republican majority that's in the house and senate. >> where is paul ryan? it's sort of confusing. he denounced the statement. he canceled trump over the weekend at an event in wisconsin. are we still waiting from him to hear him elaborate on his position further? >> yes.

there's a conference call that paul ryan's going to have with house republicans this morning at 11:00. don't know what's going to happen there. i would be surprised if paul ryan pulls his endorsement. he's got a tough balancing act as a leader of the party to try to prevent the collapse of the party turnout operation. but what we saw from ryan was consistent from what we've seen in the campaign. he's trying to protect his own reputation by putting some distance between himself and trump. this was especially strong distance. he said he was sickened by what donald trump had said. he disinvited him to a high profile event in wisconsin. but it's another step institutionally for him to come out as the speaker and say i pull my endorsement. that could affect a lot of members, not just paul ryan. >> john harwood, we'll be talking to you later in the morning. appreciate that very much. our john harwood in st. louis. when we come back today, twitter slides again, plus a new twist in the mylan-epipen saga.

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twitter shares are on the move. they're sliding here in the premarket again down double digits on reports that potential suitors are now unlikely to make a bid for the social media company. this of course comes after they slid about 20% at the end of last week on reports that certain players that had been interested are no longer -- we need you to update us here. >> it was september 23rd when we first reported of course that after receiving expressions of interests from both salesforce and google, twitter had begun conversations with those companies about a potential sale of the company. the market of course reacting quite positively to our report at the time, sent shares up dramatically. it was reported at the time while some of those conversations did include the idea of a premium bid based on at least what was then a price of 18, the stock went far, far of course beyond that as high as

25. in recent days others have reported that google has stepped to the sidelines. there was reports of some interests from disney. i was never able to fully confirm there was great interest there, but they're also reported to have stopped sort of conversing. and we know that salesforce got a good deal of heat given how aggressive it had been in its posture towards potential twitter deal from own shareholders about pursuing twitter. so we're left wondering what exactly the future of the company will hold. people close to the situation had told me as late as last week that beyond those three companies that were just mentioned there were still multiple parties that were interested in a whole company deal. but it's unclear who they are and what will happen there. and right now they don't have a great deal to share of course. it would be easier to sell off a 17.50 price, mike, than it was 25 price. one thing i've never been able to determine is what twitter wants and if the bid if there

had been or at least conversations which we know of were indicating interest at. >> yeah, what about the idea of the twitter board not necessarily being entirely behind the idea of putting it up for sale, right? i mean, is there kind of unanimity on the board that says, look, this is the process, we want to pursue a sale process or -- >> we had focused on the september 8th board meeting in part because i learned that and reported that there was a faction of the board given the lack of top line growth at the company and potential by the way you would have an activist shareholder, mike, get into the shares and start moving them towards the sale let's call it next year, the window i think for actually nominating opens around february 1st, the board was pushing towards that, particularly after having received those expressions of interests in particular from salesforce. so it's unclear to me where a board now would feel given nothing has changed on that front. and the prospect of activists you could still argue was there although if they don't feel that

there is a likely suitor that would come to the fore should they say we're no longer for sale, it's not clear what their position would be. again, we have to see how the quarter is. >> pop 3% today. stock had lost about $8 billion in market value as a lot of this chatter through september and october built up. it's kind of tried to rebuild that a little more. it shows you what the street wants in the way of one potential buyer anyway. >> i wonder if all the politics is boosting twitter at all from a monetization. i mean, this was the most debated -- the most tweeted debate of all-time. twitter put out statistics. trump and clinton have both become quite active in terms of their communication on twitter. it's just, it's hard to put that next to the fact that twitter can grow its user base or its revenue number. >> right. >> and you have this discussion of just what it's worth at a time when we're all glued to it during this campaign. >> brings to mind what jeff weiner tweeted last night, twitter has its challenges --

actually this morning, but last three days remind how essential it is digital town hall changed how news is distributed and discussed. that's exactly the point trump made last night. take a listen. >> tweeting happens to be a modern day form of communication. i mean, you can like it or not like it. i have between facebook and twitter i have almost 25 million people. it's a very effective way of communication. so you can put it down, but it is a very effective form of communication. i'm not unproud of it, to be honest with you. >> he's not unproud. >> makes you wish he'd gone onto say how you monetize that. >> that is the key question of course we brought up and jim cramer has certainly been at the forefront of this that the idea those looking at twitter particularly from the salesforce perspective were not necessarily looking at it as a media property as much as an incredible store of value of data which is becoming increasingly important as we move towards artificial intelligence and the engines that create that, their need for constantly having more and more data. you know, we'll see.

i am told that inflection actually moving upward in terms of daily average users for twitter. but we're going to get the report from the company in a couple weeks on its earnings which could prove very important to its future as well. >> all right. when we come back we'll check in with art cashin, what to expect from today's trading as we count down to the opening bell. dow and nas down four out of five. more "squawk on the street" from the nyse straight ahead. oing on? heyllis. i'm val, the orae mon. val from va? ye, val oya. quk queson, what are voya tirementquirre doing in house? yoknowto show thimportceof savi. we'rtting away acorns. so y're so of like a spokes person? no, i'm more like a metaph.okay. no, i'm... yo a spos-metaphor. ye. ok. see how can hp u organid at voya.com.

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♪ welcome back to "squawk on the street." less than eight minutes to go

before the opening bell here. let's bring in art cashin, director of floor operations with ubs. art, triple digit move here in the premarket higher for stocks. you got oil rising, politics in play, what do you attribute these gains to? >> well, predominantly oil, i think, the fact they came on again, looked like oil was about to rollover late friday. and yet they've come on again. i think politically there's a period of reassessment going on here. the london bookies have upped the odds of secretary clinton winning. and that might move some people into kind of status quo position for the market. we'll know better. we'll see if the pharmaceuticals begin to come under pressure if politics is a reference. secondarily, i think the markets are going to begin to sort through what does it mean for the senatorial race, and what does it mean for the race in the

house. i think the market has tended to favor gridlock, so if secretary clinton looks ahead in the one race, if the republicans continue to lock up the senate and the house, i think the market will appreciate that. the other thing is that the negatives that mr. trump produces will that just make people not vote for him or will it drag people out committed to voting against him. and that's really a key question here. >> art, you got the bond market closed today, is that going to kind of change a week in the signal in stocks. obviously the yield story has been a big one, 10-year right at the top of its range. >> yeah, and of course stanley fisher again talking about we're going to go once again for our annual december rate hike. so we'll see if that shows up. although, you know, they've been talking like that and i think there's enough data to come out before december that it's in my mind still only about a 50/50.

>> another group to watch is utilities. they've fallen for 11 straight sessions through friday. is that mean that they're due to sort of bounce back? was that the correction? or more room to go lower? >> well, they can move as michael pointed out. the cash fund market is closed. and one of the things that's been pressing them down along with the reits and the telecoms is that they are the dividend substitutes. and people looking for yield have been buying them. they've been selling down, as you aptly note now for many sessions. and that is because rates have begun to rise. we do have bond futures trading, so we'll keep an eye on that. >> art, thank you. good to check in with you as always. art cashin. opening bell just about four and a half minutes away. spri? i'm hearing goodthings a.

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debate last night, watch the cleanup and recovery from hurricane matthew over the weekend, which we're going to pay more attention to in a moment. bonds are closed for columbus day. aside from that, guys, it's going to be getting ready buckling up for earnings. and as cashin just pointed out, a lot of fed speak in the days ahead. try to give us some clarity on what they made of that jobs number friday. >> and one of the big groups to watch i was going to say on earnings is the financials, the banks. we're coming off a week where the overall market was down in the first week but financial stocks were the only group to close higher on this jump in rates. and you mentioned that the bond market is closed today for columbus day. we do have some fundamentals though to look forward to with three of them reporting earnings on friday. >> yeah, you had a jump in rates last week and also of course deutsche bank that situation seeming to solidify a little bit. >> although it is down today in europe. >> true. what's interesting look at j.p. morgan, it's actually outperformed the yield. seems like you have real money rotating back into big u.s. banks. >> look at the s&p at the bottom

of your screen and get the opening bell. down at the big board this morning, coen and steers, over at the nasdaq, the rice business plan competition, a graduate level student start-up competition. good luck to those kids. let's work our way through some of these analyst calls. probably half a dozen or more upgrades of tyson, mylan, aeo and underarm. start with wells upping under armour to outperform, maybe inventory gets a little less crowded now. >> they say it's one of the strongest growth stories in our group, according to wells fargo analysts. the valuation moves for ua from $44 to $46. a big increase previously had at $38 to $42 their range.

kohl's big partnership with under armour will start this fall will help earnings, help maintain the high rate of sales growth, which a lot of people, investors had questions about that kohl's partnership and whether it would sort of water down the ua brand to go sort of mid level, mid income group there. but wells fargo says it's going to be good. and the valuation is low even though nike -- we were talking about this, nike is seven times larger, adidas is four times larger, and all those stocks have been under a little bit of pressure. adidas not as much because they've been coming back in the united states. they're also getting the currency benefit. >> this call strikes me as long-term thesis intact trades in a premium to mic because it kind of deserves it and noise around whether the brand in fact is getting diluted but also i think the whole athleisure thing. i would say 45 or that range of valuation is not exactly a bold exuberant call. this stock was well above that several months ago. >> sure. >> it's still in a down trade, it's a tough group, but essentially trying to put a line in the sand. >> absolutely. >> should mention shares of

merck this morning because they're up about 3% this after a positive trial for drug first line defense against nonsmall cell lung cancer, of course one of the biggest killers in this country. i think about 130,000 people a year, unfortunately, die from the disease. it did show better efficacy than did the typical treatment of chemotherapy. remember, bristol-myers had a similar drug not treating exactly the same patient population that did not show efficacy. and that stock, if you may remember, number of weeks back got crushed. but this is a real positive for merck. the stock up over 3%, maybe adding a little bit of fire overall to pharma, although that is clearly the outperformer this morning. and by the way, take a look at bristol-myers because that is dramatically down as a result of the success, again, of kitruda versus the failure that bristol-myers had in trying to

bring its drug, which is also currently on the market though as a first line for non-small cell lung cancer. >> sticking with that group, mylan is the best performer right now on the s&p 500. shares opening up 10.5%. the upgrade, carl, you mentioned was raymond james strong buy 7 $57 12-month price target. and mike, we were sitting here friday i guess that was seen as a big overhang on the stock. >> definitely. the number they're going to have to pay in terms of set mment was probably considered to be relatively low considering what it could have been. i think the general sense that maybe they're going down the checklist of items they have to deal with in trying to get some resolution on them is a positive. they also lowered guidance, but only very modestly. i think that modest change in guidance probably has people saying, look, this stock trades maybe seven times expected earnings or thereabouts. if this is basically the new earnings level, then maybe you can make the valuation case at these levels. >> it's interesting watching mylan of course.

it had inverted already. heather bresch, its ceo, gets a l lot of heat. but the man who created the company and remains chairman, don't hear too much from him. happy to have you on any time if you want to join me. >> deutsche does initiate netflix as a sell. talks a lot about the long duration investment risk in terms of what they have to pour into content both domestically and around the world. they do not believe this company is going to get bought, but quite a week yesterday on that speculation on exactly that. >> it was interesting last week. if you look at 3% or 4% move in netflix on a given day to me it's been a depressed stock in a hot tech market, i don't think you needed takeover rumors for the stock to be moving necessarily. but i think this call kind of gets to where the street is on the name which is why you don't have this kind of blistering subscriber growth you used to have made content overlook cost for a while, but it looks a lot

like other media companies. content from the originals, it's expensive and not the sure thing. >> seems to be part of their methodology where they basically forecast a very successful future for netflix saying as many as 200 million subscribers by 2026. that's a long time from now. but assuming at that point that it trades similarly to time warner because it would have similar characteristics in terms of its ability to generate cash flow and ebitda and therefore putting a multiple on it time warner gets, you get a 7% annual return which i guess leaves them, mike, to say why buy it now. >> exactly. basically last year's tremendous rally in netflix maybe just priced in a tremendous amount of that future growth. >> energies really strong right now. i would just note that all of the companies that make up the s&p energy sector group are higher right now as the price of oil rises. wti above $50 a barrel. we're looking at four-month highs after a strong week last week. i mentioned that conference that was going on in istanbul.

the oil price could recover to $60 a barrel by the end of 2016 was the quote that came out of saudi arabia's energy minister. and of course there's increasing talk that russia could cooperate with any sort of deal and we're now looking about 2.25% higher for new oil prices. >> inklings it could break above this has been in for long time. >> yeah, we're almost at the top. >> brent almost a one-year high. morgan stanley i believe the title of their report is toning for our portfolio sins taking industrials to an overweight, basically admitting we missed a big dynamic of the year already. >> without a doubt that industrials revival has been a big story, but then of course it runs right into a little bit of statistic with the industrial conglomerates, right? after honeywell and today utx, united technologietechnologies,t a downgrade. so it's like did you miss it entirely? are you going to get another chance to reload on that industrial? it's been areas within industrials like machinery and semiconductors which are kind of

tech industrials. >> right. big inventory story, acquisition story. so with all that merck leading the dow up 130. let's get to bob pisani on the floor. >> good morning, carl. happy monday everybody. crude's the story again. we were down early on but moving up in the morning crude now over $50. take a look at sectors and energy the leader. remember the rotation we've been emphasizing for the last couple weeks in the marketplace. so out with the interest sensitive stocks, out with telecom and out utilities. energy has been a market lead s leaders, banks have been market leader and technology has been a market leader as well. industrials somewhere in the middle, but a little bit of concern the last couple days about some big warnings we have seen. but you see fraction on the upside. all ten sectors up right at the open. banks again market leadership we pointed out last week a number of banks hitting new 52-week highs. suntrust, again, that's 46 and change, that's a 52-week high, regions financial, that's a 52-week high.

keycorp. not quite, wells was as low as $42 last week and that stock has rebounded as well despite all of its problems in the last couple of days. we do have another big industrial warning and i'm a little bit worried about this because there's a little bit of a pattern. dover is a big company. they do a lot of oil and gas work. they do a lot of work in refrigeration space and food space, they came out with a warning they're not going to make numbers in 2016. they expect global economy to remain soft, they expect oil and gas to remain weak, they see margin pressure so big food and refrigeration business, these are themes that we heard last week. take a look at some of the big industrials today, specifically from honeywell, ppg another company also warned last week and those stocks all down on that. dover down 5% on preannouncement. united technology up a fraction, but that's not immune, it was down on friday as honeywell issued warning. and today, citi group big coverage on united technology came out and downgraded united

technology really for very similar reasons saying it's going to be tough sledding for awhile. the consensus for 2017 is too high. and this is the concern that's out there. some of the analysts are starting to question the numbers based on what honeywell, ppg and now dover have been saying basically concluding there's not going to be a lot of particularly organic growth, which is what analysts care about for next year. so if you take a look at what's going on, what's the problem with the global industrials? the real problem is that slow growth environment and the weekend market. so you've heard about the problems with mining and oil and gas and agriculture. these are the companies, the big global industrials, that sell products into those particular end markets. when you see weakness there, eventually you're going to see weakness in these big global industrials. q-3 estimates for revenues we're now going in remember to the third quarter, we're going into the fourth quarter but we have estimates. what we'll read is revenue growth from the big areas like health care, consumer discretion, technology, we're getting decent estimates going

in, but when you see the industrials trying to pull down a little bit here, you got to be a little bit concerned. so we'll talk about a lot -- this subject a lot in the following week. finally, we're into october. this was supposed to be the most volatile month of all. historically it is, it just hasn't happened yet. we've had no one percentage move days yet, that means a day when the s&p 500 moves one percent or more. hasn't happened and traditionally happens the most in october. there have been 44 one-percent days this year. haven't had any in october. the dow though great morning up 130 points. carl, back to you. all right. we'll keep an eye on those percentages, thank you, bob pisani. for more on today's movers let's head uptown to bertha coombs at the nasdaq. >> good morning, sarah. we've got small caps leading the way. and in part because biotechs are strong today. that mylan settlement and upgrade certainly helping the biotech sector which is coming off two straight weeks of

losses. interestingly the biotech sector no longer in bear market territory. that is to say it is now only about 16% off its 52-week high. but we're also seeing easier comparisons. we're talking about a 52-week high at the end of the year, not a year ago or even a year ago in july when biotechs were so strong. mylan, as you said, also today the biggest mover in the nasdaq 100, the biggest mover in the s&p 500. that said all of its troubles over the past month still has mylan in bear market territory. elon musk yesterday saying that tesla will not need to do capital raise either through debt or equity this quarter despite a recent filing. that has the stock recovering a bit this morning. but twitter is definitely the dog of the day. twitter's suitors seem to be balking now. and salesforce.com apparently getting pressure not to make a bid if indeed it was wanting to

move closer to that. and twitter today now down about 45% year-to-date, sarah. >> all right. thank you so much, bertha coombs. as we said earlier, watching oil prices, brent especially, jackie deangelis at the nymex for us today. hey, jackie. >> good morning to you, carl. oil prices certainly on a run on this monday morning close to $51 a barrel. and it's interesting because we started the session negative. there was some skepticism in the marketplace about this opec deal that continues to linger. but there's a couple of reasons that that is starting to dwindle at this point. number one, we got some news that there's an issuance of a saudi bond offering. we have reported this a couple of months ago as one of the reasons that the saudis have incentive to keep this market stabilized right now. and in fact the road show is happening. there are three lead book runners, citi, hbc and -- potential aramco we would see next year. you have this energy conference occurring in istanbul.

you have some of the great producers getting together. any time we have a forum where there are sideline conversations about oil prices and what's happening within the industry, some of these deal points that we are waiting for and can see next month might be ironed out at this conference. so we have to keep an eye on that, which shows you there's real momentum here is that you've got a stronger dollar continues to creep up. and yet crude is creeping up too. back over to you, carl. >> jackie, thanks so much. jackie deangelis. when we come back, unique perspective on last night's presidential debate and takeaways for investors with the election one month away. dow's up 140 session highs, nasdaq 100 awfully close to an intraday record high. back in a minute. across new york state, from long island to buffalo, from rochester to the hudson valley, from albany to utica, creative business incentives, infrastructure investment, university partnerships, and the lowest taxes in decades are creating a stronger economy

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businesses count on communication, and communication counts on centurylink. last night's presidential debate was bitter from the start with candidates sparring on everything from trade to economic policies. our next guest is calling this election a crazy train race to the bottom. let's bring in chris krueger, washington research strategist at cowen and company. good morning. >> good morning. >> we spent part of the morning debating the correlation of futures to last night's debate. can we read anything into what's happening this morning? >> i think you can a little. i mean, i think with what wall

street is looking for here is probably a clinton win with divided government. there is sort of the bull case to be made for a trump win outside of his commentary with tariffs, et cetera. but if you're pricing in a clinton win with a divided government, last night probably helped you in that thesis. growing concern though, i think, is the potential for, you know, this giant meteor that is that "access hollywood" hot mike tape continues to rip through the republican party. trump really didn't sort of have that contrite apology yesterday. paul ryan is hosting a conference call today at 11:00 with the house gop. so if the house republicans start to run from trump, this race could get even -- could even get uglier. >> could you elaborate on that? what would it mean for trump, chris? and what would it mean for the senate and congressional races in november? does it change the calculus for

the gop? >> absolutely. i mean, if you start seeing even broader defections, you've already seen about two dozen over the weekend. but if you see a paul ryan or a mitch mcconnell, someone to that effect, i think what you're essentially going to have is a circular firing squad within the republican party because every candidate that dumps trump, trump probably dumps them. i mean, he will in all likelihood if past is prologue, he tends to direct a lot of his twitter account to those people that he views have treated him unfairly, et cetera. so you could see just a lot of republican-on-republican political violence here with clinton just able to sort of sit back, lock in those early votes. keep in mind ohio starts voting this week. a number of states already voting. so clinton just sort of leaning back letting republicans kill each other. >> chris, if things go the way you lay out here with the odds suggesting that you get a

clinton win and still the republicans holding at least the house, you know after every election there's that question does the new president have any kind of a mandate? is there any margin of victory that clinton could have let's say in the popular vote that would say, yes, this is now a mandate presidency, that there's going to be sweeping policy changes? >> it's going to be tough because she'll have that republican house. and lest we forget, i mean, hillary clinton lost 43% of the vote in the democratic primaries to a 74-year-old self-described democratic socialist who's not even a member of the party. so she has incredibly high unfavorables. it's just that trump's are higher. having that republican house as well the margin will be critical. that's probably the biggest lens in which to watch next year. that house republican majority is 30 seats right now. that's going to come down. if that's a single seat majority though, we're probably back to debt ceiling fights and government shutdown fights

because you will have an enlarged sort of freedom caucus majority in that smaller majority. so you have the debt ceiling back of march next year with extraordinary measures you're probably talking sort of september, october. >> finally, you know, there's been all kinds of crazy predictions as to what the market response would be to a trump victory. do you have yours? >> well, the market doesn't like uncertainty with trump that is what you get almost by definition. clearly the anxiety i think investors have with trump is his talk on tariffs. keep in mind he can do all of that on day one, and that's not even sort of a gray issue. this is very black and white sort of chapter and verse. if he wants to do the 45% tariff on chinese imports on day one, that's something he can do. and with trump it's just sort of this unknown quantity that generally speaking investors don't favor the uncertainty. though with trump by definition

you have a republican house and a republican senate, so you can really kind of unlock tax reform and some of those other challenging policy rubik's cube's that have been unable to unlock thus far. >> yeah. well, buckle up for the next month, chris. thanks so much for your guidance. good to see you. >> thanks, guys. great seeing you. when we come back, prowling main street for comeback stocks. find out which ones we're talking about. this is mike santoli's brand new column on cnbc pro. we'll hit it when "squawk on the street" returns. when you're on hold, your business is on hold.

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♪ the dow up 150. in general the market has shunned many household stocks tied to the steady u.s. consumer this year, but some have actually been showing signs of a rebound. mike santoli here with a closer look at some of the opportunities in consumer. this is one you took up for cnbc pro. >> that's right, sarah. the premise is the u.s. consumer remains steady, not necessarily spending heavily, but spending in a steady manner. job growths last week, wage growth outpacing inflation, holiday spending intentions are

rising. you also saw consumer credit go up more than expected on friday. that all says the u.s. consumer is prepared to spend in a steady fashion. yet those consumer related stocks have really been smart to avoid this year. the chain retailers, things like autos and durable goods makers here in the u.s. have definitely underperformed seriously. so i look back at gaps, surprise okay sales number and the 15% pop in gap stock and say what are the makings of one of those rebounds. and it's basically a heavily shorted stock that the street doesn't like anymore and looks cheap. if you use that basis, you come up with names like kohl's, also a high dividend yield. you have target, which tends to swap leadership with walmart over time and walmart has outperformed by about 22 percentage points in the last year. also whirlpool, gm, some of these names that have been beaten down a lot of people have been saying, wow, is that telling us a scary story about the economy. if you conclude not necessarily and the economy is okay in terms of this cycle, then these stocks look relatively cheap. also my favorite halloween play, sarah, party city and michael's

stores. the craft seasonal goods retailers nobody pays much attention to. >> i'm just looking at -- some of these stocks, urban out fitters up 61% this year. >> some specialty retail have caught a breeze that don't look as cheap anymore and some of the more broad scale ones like a gap, kohl's, still look pretty depressed. >> i was thinking that gap upgrade argued consumers going from big ticket purchases, house, car, more to apparel. >> more to apparel. i think there's another secondary bull case that says people are going to buy pants that have snaps and zippers as opposed to yoga pants. >> the denim call is getting louder and louder. >> is that the end of athleis e athleisure? >> not the end. >> the debate. >> when we come back this morning, a wide range of viewpoints regarding the debate last night. one of trump's economic advisors among those who will join us, the dow up almost 150 here to start a monday. back in a minute.

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eisen, david faber at post nine of the new york stock exchange. markets deciding to go green in a hurry here. dow up 143, s&p up almost 15 to 2168 as we take stock of last night's debate, get ready for earnings which will come in hot and heavy later in the week. our road map for the hour begins with donald trump and hillary clinton sparring in last night's debate. the jabs getting personal. we've got the highlights and analysis straight ahead. the crisis at samsung is deepening as the company halts production of the galaxy note 7. we're going to breakdown where the company goes from here. and residents from florida to north carolina beginning to clean up from hurricane matthew, but the danger isn't over. we've got the latest on rising flood waters. but first, let's get back to the big story, last night's presidential debate. it was heated right from the start. our john harwood is in st. louis and joins us with a recap. good morning again, john. >> good morning, carl. again, the context of this debate was the weekend of uproar over that "hollywood access" tape and many republicans

defecting both republican house members and defecting from donald trump, repudiating him, some calling for him to get out of the race. hillary clinton's strategy in appealing to soft republicans and swing voters in the race was not so harp too much on the tape but use it as what she considered a piece of confirming ed about their already preexisting doubts about donald trump's temperament and ability to be president. here's hillary clinton. >> if this were just about one video, maybe what he's saying tonight would be understandable. but everyone can draw their own conclusions at this point about whether or not the man in the video or the man on the stage respects women. but he never apologizes for anything to anyone. >> now, donald trump's strategy in response to that in response to everything else he heard from hillary clinton last night was to throw it right back at her.

so he went at her on the idea that hillary clinton and her aides, not donald trump, had initiated the birther controversy and she called on him to apologize to president obama. >> you really owe him an apology. you're the one that sent the pictures around your campaign, sent the pictures around with president obama in a certain garb. that was long before i was ever involved. so you actually owe an apology. >> now, the problem with that strategy by donald trump is of course that president obama is aggressively campaigning for hillary clinton. so is michelle obama, who donald trump said was attacking hillary clinton. so there was some weaknesses in that approach, or credibility problems in that approach. now, who won this debate? take a look at the instant polls that occurred afterwards. cnn did an instant poll of debate watchers, showed hillary clinton won by 57% to 34%. ugov did another poll that

showed a narrower gap, hillary clinton 47%, donald trump 42%. analysis of twitter showed she did better on twitter. but again, the real measure of the impact of the debates going to come in national and battleground state polls over the next several days. it's a little bit too early right after an event like this happens to get a full picture of the impact, guys. >> john harwood in st. louis. nice shot of the arch behind you, john. we'll talk to you in a little bit. we are joined this morning by veteran political strategists. good morning to you both. >> good morning. >> sarah, i'd love to get your insight, your analysis of the calculus to basically enter into this new level of rancor which clearly plays to trump's base, knowing what we know about voters who severely dislike hillary clinton, does it work? >> it only works to motivate the people who are already supporting him, right now is about 40% of the country, which of course is not enough to get

elected president. i thought that what donald trump did last night in the debate was he stemmed the bleeding, but he didn't ultimately get himself out of icu. and his campaign is on life support. many people have abandoned it. and i don't see much that changed after last night relative to the trajectory of this race. >> morris, a lot of people felt hillary clinton was restrained last night in her performance. she could have gone after him a lot harder about that tape and about some of the other issues that he's been talking about. do you think that was on purpose? and is it effective? >> yeah, i think she took a measured approach. as you know, this is a marathon, not a sprint. she didn't need to land a knockout punch. she needed to sustain and collect some momentum. she did a good job, a decent job. but so did he. i think what she did was to really stabilize her position. now she needs to expand and really motivate her base. trump was smart because he knew that he had to stabilize his base. so that's why he went to the red

meat to get these guys fired up. hillary now needs to pivot and go to the heart of the matter and really focus on those five or six states that are going to really matter and going to win. and talk to white educated voters and females. so i think they both did what they needed to do. i thought it was a draw, but certainly it's going to be a close race as you heard me say in the past that's going to come down to the wire. >> so the way you guys describe it sounds like triage, almost, right? you're treating the most severe patients first. sara, doesn't that then allow him the next four weeks to somehow pivot to the contrition that some say he needed to show? >> well, i think it does. you know, that assumes nothing else comes out either on the tax front or with respect to other tapes of him discussing women in an inappropriate way. you know, i think, for trump he has to sort of just get up every day and have the best day he possibly can. that's really all you can do

with a month left to go. and like i said, hope nothing else comes out. you know, there's been a lot of talk about contrition, and i -- you know, my first reaction when i saw that tape was he needs to go apologize. but i think the challenge for a lot of voters right now is they understand that what he really needs is a change of heart. and it's very difficult to manufacture that. and he can try. and perhaps he'll get there and he'll convince enough people to keep the race close. but the events of the last three days have been tragic for his candidacy and for the republican party. >> and what's so stunning, morris, is his resilience among his supporters and among his base. and we just don't know exactly how big that is and how many will turn out to vote on election day. but what it tells you is that there's a lot of frustration with the status quo, a lot of people who don't want to see insider establishment candidates win. so even if clinton does maintain her lead and win the election, there's going to be a lot of angry people. how does she react to that? and what kind of country are we

looking at past when she -- past her inauguration if she does win? >> well, she has a history of working with republicans. it's funny, when the republicans run against her, they won't compliment her, they won't say, but when it's not an election year you'll hear them say she's actually okay to deal with, she knows how to cut deals, she knows how to work with people. you know, it is a sentiment around the world that anti-establishment, i would agree with you. look at what happened in london with brexit, look at what happened in colombia where the government cut the deal with fark and voters rejected it. this is a weird and different time. so i'm not counting donald trump out. i'm not counting -- he's been able to turn the corner and have nine or ten lives. this is a guy that you cannot count out. he's like a vampire in a lot of ways. >> i think it's a good point. you know, donald trump has bounced back before from things that many times people have said how could he possibly, you know, succeed after these statements.

the challenge is the accumulative effect of all these statements now 30 days out just means there just isn't much time to change people's perceptions. and the tragedy for the trump campaign is that there is so much material in which to talk about hillary clinton and her failures. just in this last two years alone whether it's on the foreign policy stage, whether it's all of her e-mails. just last week she says one thing to wall street insiders and another thing on the campaign trail. i mean, this confirms what people think about her. they don't want to vote for her. but she's likely going to win because of his inability to put together a campaign that can be successful and unite people. >> i'm not for sure they don't want to vote for her. i think if you look at where she's been able to get separation, you look at those battleground states, you look at her traction, she's picking up momentum with her base, but also with educated white voters which will be the most important

voting blocks to really make separation. >> she's incredibly unpopular, and she's not trustworthy. >> first of all, i didn't interrupt you. you're acting like donald trump now. look, the fact of the matter is she does have a base that believes in her. she needs to motivate that base. and as you know, democrats sometimes don't go to the polls when they think things are taken for granted or if it rains. this is why i'm not counting this man out. we need to stay very focused and drill down on those five or six states that are going to make a difference. >> one last thing, sara. i mean, so much discussion last night and this morning about a candidate who threatens to put his opponent in jail if he wins, it's the cover of the "new york post" today, conway this morning says it was a quip. how are we supposed to know what's a joke and what's a serious proposal? >> yeah, i thought that was not smart. you know, this is the kind of thing that happens in the ukraine and other places around the world. and, you know, while he made a joke of it, it's just not -- america is better than that.

we don't jail our political opponents because we disagree with them or we find them untrustworthy. and, you know, with him he says a lot of things in his campaign events that aren't jokes and you can't now say it is a joke when you've said it many, many times and it wasn't meant to be funny. so i don't think that works. >> well, sara, the fact of the matter is that donald trump always says things and does another. for example, he talks about he's going to be so great for trade but makes all of his clothes overseas. he talks about anti-dumping but then again uses china steel. so if he says he's going to take and put hillary clinton in jail, i don't know, i have a tendency to believe him because i think he's just that crazy. that's why i think the american people are starting to pay attention now to the election. there's been high numbers watching these debates. i believe she's going to turn the corner. but again, she cannot take this for granted. this will be an extremely close race because donald trump's voters are passionate. and when you have passion, people come to the polls. you need to make sure on the democratic side we're connecting

with our voters, getting them out to vote and ultimately run the race completely and hopefully we'll win in november. >> morris reid, sara fagen, thank you so much, guys. appreciate it. see you soon. when we come back, flood waters rising as the southeast continues to suffer from the aftermath of hurricane matthew. we've got the latest. and as we head to break, take a look at where stocks are trading at this hour. we've got a pretty solid rally on a monday morning. the dow's up almost 150, s&p up 15. the nasdaq doing the best up almost a full percent. this coming off of the first down week for stocks in four. much more "squawk on the street." stay with us. guess what guys, i switched to sprint.

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learn how you can save at pge.com/save together, we're building a better california. cleanup efforts beginning in much of the southeast. the threat of flooding looms large after hurricane matthew ripped through the region. at least 19 people in the u.s. are dead as a result of the storm. more than 2 million businesses and homes are still without power across the eastern seaboard. joining us now, david paulson, served as fema director from 2005 to 2009. david, as a result of the storm surge, how significant of a threat does that continue to be? >> definitely going to continue to be a threat. we need to first of all say heartfelt sympathy and prayers go out to those who lost loved ones and people who lost their homes. this is a tough full-titime for from mid florida up into virginia.

it's a huge issue with flooding in low lying areas. the tidal surge obviously is gone but it left a lot in its wake. so those are the things we need to watch over carefully. >> so what can people expect then who were effected in those regions? >> well, one thing the president just signed the declaration for starting the debris removal. that will happen in the next few days start getting the streets cleaned up, getting stuff where you can move around a little better. i think what people need to do is still just be careful. they're tired. they've been up a lot of hours. now is the time when we see people getting hurt, people getting killed. so it's just to be very careful, make sure you get plenty of rest. and if the outside of your ability to do something, wait and be patient. let the experts come in and do the cleanup. >> yeah, i mean, of course in many ways it went better than might have been anticipated in terms at least of the storm not making landfall for quite some time. and not where it was originally believed to be when it was much stronger. still, what do you think the longer term ramifications here

are for the region? >> i think we need to step back and look how are we responding to these disasters. we're spending billions and billions of dollars every year on these natural disasters, we spend very little up front for pre-disaster mitigation. i think the next administration, groups like bill strong administration, need to sit down with the next administering, whoever that is, and say let's take a step back and find out how are we funding these disasters. it's not sustainable the way we're going forward. we have toot something different. i think that's for next year. for now, again, just caution people to be careful out there, debris removal cleanup will start. people will be getting back in their homes. but please be patient. don't overextend yourself and get hurt, or worse, lose your life. >> and yet it strikes me that fema itself has made a lot of progress over the years, 11 years ago hurricane katrina when there was so much negativity and fema was blamed for its

failures, have there been lessons learned? and how much of an improvement has there been to the response? >> tremendous amount of lessons learned in katrina. we worked with congress to do the lessons learned after katrina. i think one of the big things we put in place was the pre-disaster mitigation -- i'm sorry, the pre-landfall declaration. you saw it working here where fema pre-positioned supplies, people, commodities down here prior to making landfall. that's something we put in place after katrina because what we saw in katrina was the old system simply does not work, waiting for local community to become overwhelmed before the state steps in, waiting for the state to become overwhelmed before the federal government steps in. i call it a system of sequential failure. it does not work in catastrophic events. the other is -- >> all right. sorry. go ahead. finish your thought. i apologize. i guess that's it. david, thank you for joining us. appreciate it. david paulison joining us served

as fema administrator from 2005 to 2009. >> thank you for your coverage. when we come back, samsung struggles as the company forced to hit pause on the production of galaxy note 7. we're going to talk to state street global advisor ronald o han li and tobias lek vich. both on the track and thousands of miles away. with the help of at&t, red bull racing can share critical information about every inch of the car from virtually anywhere. brakes are getting warm. confirmed, daniel you need to cool your brakes. understood, brake bias back 2 clicks. giving them the agility to have speed & precision. because no one knows & like at&t. thiswell we thought geench programmed machines to talk. ge is an industrial company that actually builds

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markets in rally mode. investors continue to weigh the impact of last night's presidential debate and the outlook for the u.s. economy. and they're starting to brace for third quarter earnings season kicking off this week. for more on what to do with stocks at this point, let's bring in ronald o' hanley, and tobias lekovitch. didn't investors learn their lesson with brexit that you can't get too excited about one outcome or the other by watching polls? >> unfortunately, i'm not sure they were that excited in watching last night anyway. but i think the -- it's

interesting what's going on in the market. i think most people view donald trump had to have a knockout blow, probably didn't do it and as a result, you know, the probabilities of a clinton victory continue to gain some traction on the street. and it's also interesting that energy's leading partially because of the opec news today. but also if you look at the likelihood of the hillary clinton victory, it would potentially put more of an environmental kind of cloud, if you like, over shale activity in the u.s. and that would propel and prop up low prices good for the sector in terms of stock price performance. >> maybe one of the reasons behind the rally. ronald, you've got a front row seat to retail investors with your big etf business. what are you seeing in terms of the flows and how investors are coping with heightened uncertainty, sort of an overused word right now, but clearly that's how they see this election. >> well, i think that's right. and i think that much of investor sentiment is driven by certainty or uncertainty.

i think probably what you're seeing today to some sense that the outcome of election may be more certain. i don't think it's necessarily a value judgment on either candidate more so than with some certainty people can make some investment decisions. >> tobias, i know you like energy and just mentioned it, you also say in a recent note the bond proxy groups are going to raise in the face. we've seen telecom weak again today. what more damage do you expect? >> a number still look unattractively valued, staples which you didn't mention, many of those stocks are at high levels historically valuation perspective. on a p/e basis probably 25-year highs a few weeks ago. and, again, on a valuation perspecti perspective. it's more about these companies having really rallied already or these stocks haven't really rallied, their valuations stretched, earnings growth modest 3%, 4%, 5%, and yet

people pricing them as if they're going 20%. that's the discomfort area. you're right, we do think the bond yields can be moving higher. the fed seems to be wanting to do something more positively. we also see the long end of the yield curve track up as data has been better. ism numbers in august were weak, in september recovered. that's continue to see the likelihood of some improved trends. again, hiring's been okay. it's not been phenomenal, but it's okay. we're not losing jobs. >> and yet on the other side, ronald, you've seen investors pouring into fixed etfs this year, where are they going? what are they betting on in terms of rates? and how vulnerable are they if we do continue to see rising rates as tobias forecasts? >> well, i think what investors are seeking is an income in yield. and as you've seen interest rates decline and stay at a near zero level, the traditional investment approach of those near retirement of relying on

traditional savings vehicles just isn't working. what you're seeing investors recognizing they need some kind of protection to principle but need more yield than they would otherwise get. so i think the industry's working very hard to educate these investors that in a rising rate environment there actually is a risk to principle. but what you're seeing here is a natural outcome from a near zero interest rate environment. >> and, tobias, are you a buyer of the banks on this rising interest rate theory? >> we like the banks. we like the diversified financials within the financials area. we have insurance on upgrade watch currently market weight there. look, i think it's partially due to that, but there's also a steepening of the yield curve we were already seeing, loan activity still decent. so they can earn some money. and investors on a valuation basis have pretty much thrown in the towel on these stocks generating some opportunity. >> all right. we'll leave it there, good discussion there some sectors and politics. ronald and tobias.

>> thank you. crisis deepening over at samsung as the company's temporarily halting the production of its troubled galaxy note 7. our jon fortt is with us had it not been for politics over the weekend we'd be talking about this a lot more today. >> yeah. and people on social media, i think people on the street are talking about this i maybe not just as much as politics, but they're talking about it a whole lot. because what we're seeing here with the incidence here with samsung's replacement galaxy note 7s, we haven't ever seen anything like this. i mean, first of all there were 2.5 million phones worldwide involved in the initial galaxy note 7 recall. 1 million in the u.s. samsung had this replacement program saying we've figured out what the problem was, it was a battery supplier, we fixed that here. you'll be able to see on the new phones that they are safe. and yet five of these supposedly safe phones have now had issues, two in kentucky, one in minnesota, one in virginia, another in texas.

all of the major carriers now are allowing people to trade in even their replacement phones all but sprint has said they've stopped selling them altogether. sprint has not said that at this point, but what's concerning is that samsung has not acknowledged the problem yet with these replacement phones. they simply said that they're halting production, they're working with a consumer products safety commission on this. but the carriers have already moved and the images of burned out replacement phones are online. so there's massive potential for reputational damage here with samsung because consumers obviously don't know if they can believe what the company's telling them. >> one reason why apple stock is up 1.65% this morning, i guess, given the competitive landscape and the fact their phones don't catch fire. >> absolutely, david. good for apple particularly with since the iphone 7 and 7 plus, the bigger innovation is in the high end phone, the larger phone that competes more directly with the galaxy note 7.

so if you're looking for a bigger phone, if that's what you want, well, you can't have one from samsung. you've pretty much got to go to apple or maybe hang onto that phone. you can look at what google's got. but in terms of technology even in these latest google phones a lot of reviewers are saying this is apple's first step out of the gate with the pixel and it's not quite up to par. >> you're going to talk to ralph dela vega in just a bit. >> we are. now vice chairman over the entire business. he'll have a great perspective and of course at&t was the first carrier in the u.s. to carry this generation of smartphones, the first iphone. >> jon, we'll see you soon. jon fortt here at post nine. mylan is another stock moving this morning. let's send it to meg tirrell with more on why it's moving this morning. >> david, mylan reaching a $465 million settlement with the department of justice and other government agencies over the charges of misclassification of

the epipen as per the medicaid rebate program. there had been several charges mylan wasn't paying enough in rebates to medicaid, even the centers for medicare and medicaid services said it told mylan of this. this resolves those issues. also a corporate integrity agreement around this but the settlement finds no finding of mylan's wrongdoing. also late friday lowered adjusted earnings guidance for the year by 15 cents on the bottom end, 25 cents on the top end but reiterating guidance for $6 adjusted eps in 2018. now, raymond james upgrading the stock to a strong buy saying this removes one of the nearest term overhangs on mylan. and really this settlement a lot less than a lot of people worried it potentially could be. despite the stock's reaction today wells fargo's david maris coming out saying this may not be the end for mylan. s.e.c. mylan disclosed late

friday that the s.e.c. is looking into this issue. and this doesn't resolve all the issues of where this started the pricing of epipen. so still more to watch. >> meg, love to pivot for a second stay in your area of expertise though. bristol-myers shares down and merck up not nearly as much as bristol down. of course the news the drug for non-small cell lung cancer showing efficacy versus chemotherapy as a first line defense, bristol failed with their drug in terms, i guess, of a similar patient population. why is bristol taking the brunt of the move today as opposed to merck perhaps not as much as you might have anticipated with the good news for it? >> that's a great synopsis and a lot of people will remember in august when bristol-myers took a bigger tumble on failed study in this nonsmall cell lung cancer population. this is patients not treated before with advanced lung cancer. and essentially the difference between these two drugs a lot of people thought was in the patient populations they were tested in. and so over the weekend at this

european cancer conference people were looking to see how will they directly compare when they actually got a glimpse of the same patient population for bristol-myers' study and merck study. small numbers for bristol-myers, investors disappointed. didn't look like their drug hit the same efficacy level as merck's did. that's why you're seeing tumble just so much on this. merck's did look very good so the expectations for merck were pretty positive going in. turned out worse than expected for bristol, david. >> all right. thank you. bristol-myers not that long ago a $75 stock. meg tirrell, thank you. when we come back this morning, we'll breakdown last night's debate and the path forward and trump economic advisor and former chief economic policy advisor to -- a lot more ahead on "squawk on the street." it's just awfully good that someone with the temperament of donald trump is not in charge of the law in our country. >> because you'd be in jail. >> secretary clinton --

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good morning everyone. i'm sue herera. here is your cnbc news update at this hour. rising flood waters in north carolina after hurricane matthew have led to dozens of daring water rescues. three people were saved during this one in fayetteville. the deadly storm dumped 16 inches of rain in some areas and is being blamed for 20 deaths across the southeast. a man allegedly planning a terror attack in germany is finally in police custody. officials say they captured the syrian refugee after a two-day manhunt. the suspect escaped during a friday raid at his apartment, which uncovered several explosives. a vigil was held last night in palm springs to remember two officers killed over the weekend while responding to a domestic disturbance call. jose gilbert vega a 35-year veteran of the force and leslie zerbeni just returned from maternity leave.

the suspect who barricaded himself in his home for nearly 12 hours after the shooting is in custody. a third officer was also injured. and the glittering lights of another atlantic city casino are dark for good. the trump taj mahal closed its doors for good this morning after failing to reach a deal with union workers. you are up-to-date. that's the news update this hour. sarah, back down to you. sue herera, thank you. round two is in the books. last night's presidential debate the culmination of a weekend in which the trump campaign was in full defense mode facing dozens of gop defections and harsh criticism of the candidate's past lewd comments about women. but aside from those personal attacks, the candidates did cover some substance last night. energy policy, syria, health care and little even on taxes and the economy. >> we have no growth in this country. there's no growth. if china has a gdp of 7%, it's like a national catastrophe.

we're down to 1%. and that's like no growth. and we're going lower, in my opinion. and a lot of it has to do with the fact that our taxes are so high. just about the highest in the world. and i'm bringing them down to one of the lower in the world. and i think it's so important one of the most important things we can do. >> joining us now, trump campaign senior advisor steve caulk, chairman and ceo of the federal savings banks and former senior economic advisor to vice president joe biden and cnbc contributor jared bernstein. gentlemen, good to have you. mr. caulk, are you advising mr. trump? we don't have zero growth, we had 1.4% last quarter and it was low last year 2.4%. do you see the outlook as dire as your candidate? >> well, look, i think first of all he did say 1%. we know it's sub 2% growth. jobs were down only 156,000 jobs in september created. you know, unemployment's up to 5% with unemployment

approximately 9% 7%. that particularly hits the middle class, the young and minority workers the most. out of that number only 3,000 of those jobs were goods producing. 151,000 were service jobs. and although i love my friends in the world of franchising, those entrepreneurs created 26,000 of those jobs. so, yes, things are a bit dire. people are scared. we've only seen a six-cent raise in average pay this year. and that's just not the direction we want to go. i was thrilled to hear the words tax, trade, deregulation and energy in the debate last night. and i want to get back to focusing on those issues of lowering the corporate tax rate and getting over this insanity of the same policies over and over and hoping that we're going to get different results. >> okay. let's pick one of those trade because that really is one of the highlights of donald trump's strategies and you've said you'd like to hear it. he talks a lot about how nafta was a job killer in this country, and that's certainly

debatable by the economic research. he doesn't talk about how he's going to renegotiate it and make it a good trade deal that will add to u.s. jobs. how do you do that? >> look, i think that's the key is that mr. trump has talked about the fact that these deals aren't set in stone. and when we have a bad deal for america, it's time to re-look at it, renegotiate it and make sure we have parity across trade internationally. it's that simple. >> i would like to hear specifics, jared, and turn the conversation to you because it seems to me hillary clinton should be talking a lot more about the millions of jobs that president obama has created under his watch. >> right. >> the fact that the unemployment rate has cut in half and that the economy has gone from negative growth in 2009 to positive. i mean, it's not great, but it's an improvement. >> no question about it. the 15 million jobs since employment started growing, that's actually the longest job growth period on record. steve is wrong if he says the overall unemployment rate is 9.7%. it's actually 5%.

he's confusing that with the underemployment rate. and that has come down from about 15% or 17%. so moving in the right direction, not there yet. not at full employment, but i completely agree with you. i would be definitely touting the kinds of developments you've said. and then by the way, i would add most importantly, because if we -- we talk about gdp and aggregate job growth, what really matters most to families are their paychecks and their incomes. we now have real paychecks growing faster than they have in any of the past three or four business cycles. the key is they're going to have to keep growing for longer. it took awhile to get there. and last year the median household income grew 5%. that was the biggest growth rate for the middle class household on record. you know, the poverty rate fell faster than it had any year since the late 1960s. so this recovery is finally beginning to reach families who hereto for have been left behind. a lot of families are still left

behind and these candidates both have to explain in greater detail how they're going to reach them. but i agree with the point you impolilicitly make. donald trump doesn't sound like he has a plan. he kind of rants and raves. >> steve, you mentioned taking down regulation and obviously a lot of people who follow business are dying for that to happen. >> sure. >> i wonder though, that argument is coexisting in a month where we've had mylan on the hill, we've had wells on the hill. does that make it more complicated? >> well, i think any time that there's a single bad player -- you know, it's unfortunate that a company like wells with over a century of great experience in taking care of customers has made a mistake and a few bad actors are crushing their reputation right now. but the simple fact of the matter is we have 3,500 new regulations that became permanent this year. 2,500 that became new regulations in permanent phase in final rule phase last year. and with 6,000 separate new rules and regulations, it is

absolutely strangling this recovery. and i think we have to look at those industries that are effected the most. take home ownership for example, at a 50-year low with only 62.9% of americans owning their own home. that can be corrected very, very easily with industry input. so i think that's what we're looking for in this kind of clear-eyed leadership, is to help understand what regulation needs to be rolled back and focus on those things that can most directly effect the economy as quickly as possible. >> and on that -- >> just for the record, can i say, i don't disagree with where steve ended there. i think, which is, you know, breaking news in and of itself perhaps. but the idea though is that it's actually not helpful to say there's x thousand regulations because believe it or not some of those regulations are really helpful. not every regulation is a bad regulation. you have to look at the plus side. so for example, donald trump would like to take down the consumer protection bureau. now, that is a regulation, and a pretty significant one that i

would very much support. that bureau has delivered $11 billion to consumers who've been ripped off by companies. why you'd want to get rid of that is beyond me. so you have to go regulation by regulation. >> although, you know, on this regulation point, i will say, jared, hillary clinton has talked about tougher regulation on banks, cracking down on bad behavior, which we're all reminded of in the wake of the wells fargo scandal and yet this weekend didn't get a lot of play but we had the release of those wall street speeches. and there is a question there as to how she's going to crack down on wall street when she's been paid -- >> let me address that. because i think you raise a great point. i think hillary clinton is doing two things. one, she gave those speeches to wall street. no question about it. she said -- she allegedly said what are in those e-mails. she also has a very aggressive plan to build on the oversight that you see in the dodd/frank financial reform legislation, which i think is super important if we don't want yet another

bubble bust repeat cycle. and, yeah, you can do two things at once. you can talk to those folks, you can speak to them. i don't think there's anything wrong with that. and you can also make sure that you're regulating them so they don't continue to screw up the economy. and i believe she's going to do both. >> all right. i'm getting hate mail from both sides. it's time to leave this conversation for now. we'll have you both back onto talk about some of these issues. thank you. >> look forward to that. thank you. >> when we come back, tom brady returning leading the patriots to a win. we're going to talk to nfl agent drew rosenhouse about that amazing matchup. look at shares of tesla rising after elon musk says the company would not have to raise new funds during the quarter. stocks up more than 3%. "squawk on the street" is back in a minute.

welcome back to "squawk on the street." the dow's up 150 points, the s&p up 15. markets are higher. broad base with energy rising

more than 1% to lead all s&p 500 sectors. this as oil climbs more than 3% to $51 a barrel for wti crude. among stocks lifting the sector overall, exploration and production names like murphy oil, chesapeake, devon energy, look at transocean as well on the rigging side of things all up by around 3%. check out those drillers, carl, a broad based rally. tom brady returning from suspension yesterday leading the patriots to that lopsided win over the browns throwing for over 400 yards in the process. joining us on the phone this morning to talk about brady and all things nfl is nfl agent and ceo of rosenhaus sports representation, drew rosenhaus. good morning. good to talk to you. >> good to talk to you. i'm in charlotte for monday night football. we've got the dolphins-titans game yesterday. it was an exciting day in the nfl, but nothing more impressive stood out than tom brady coming back after four game layoff, no practice, no games and the guy

throws for 400-plus yards and was the most impressive performance i saw of all the teams yesterday and all the games. >> no, he definitely added to the legend yesterday. i mean, if you didn't already consider him the best ever or one of the best, he made that argument again. he was a man possessed. what does it mean for the season overall now? what happens now? >> well, it's pretty scary when you think about how good the patriots can be. when you get rob gronkowski back, who was really healthy for the first time yesterday, and they've added, you know, martellus bennett to go along with edelman, blunt, the defense is always stacked for new

england. you'd have to say that the patriots right now even though the vikings are undefeated at 5-0, to me the patriots are the most impressive team in football with brady back. >> depressing, drew, as a jets fan, really don't need to listen to that anymore. you know, lopsided -- a lot of people seem to be watching the nfl. what's going on here? >> i think that it's really a product of all the interest in the election, this is one of the most sensational and controversial and most watched election periods that we can think of in recent history. i think once that is over, we'll see the ratings climb right back to where they are. i think there's going to be some compelling matchups and some great games coming up here with a lot of the big stars of the league squaring off. and i'm confident that the

ratings will get right back to where they've been in the past. >> drew, have you watched a game on twitter? and if so, is that experience rewarding for you? do you need to see a scroll of tweets to the right side or below the screen? >> you or below the screen? >> you know, what i like, i've been on the road and have been able to keep up with the game on twitter. for me as someone who has to watch every nfl game, every week, the games on twitter are awesome, because, you know, you don't have to be in front of a television to keep up with the game. i don't watch it on twitter, because i want to see all the corresponding tweets or comments, but i watch it because it's a great way to watch a game on your mobile device. and the quality is outstanding of the telecast. look, i love the assessibility that we have right now to watch the national football league.

there's no excuse. you can watch a game on an airplane with the wifi, you know, you can watch a game -- i don't recommend doing it while you're driving, but if you're in the passenger seat, you got it. so it's really, really neat for a football junkie like me. >> yeah. the sand box is definitely getting bigger, which is great for the sport. maybe not great for those who have had legacy rights over the years. we're going to see how that all plays out in the future. drew, have a good week, we'll talk to you soon. >> nice catching up with you guys, carl, take care. >> drew rosenhaus. as we head to break, samsung struggles deepening as it halts production of its galaxy note 7. the viers chairman will join "squawk on the street" at 11:40 a.m. eastern time. you won't want to miss that. they'll be talking, of course, of the samsung problem and a lot more. stay with us. guess what guys, i switched to sprint.

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taxes front and center in the election and also in last night's debate. our robert frank joins us with more. robert, did we learn anything new about trump's finances? >> we actually did, sarah, this

was big news that got buried this morning, donald trump making news by confirming for the first time that he paid no federal income taxes for certain periods by using losses from his company. >> did you use that $960 million loss to avoid paying personal federal income taxes? >> of course, i do. of course, i do. first of all, i pay hundreds of millions of dollars in taxes. many of her friends took bigger deductions. warren buffett took a massive deduction. soaros, who's a friend of hers, took a massive deduction. no comment from soares or buffett, but trump benefits to two loopholes, writing off interest on his loans, as well as depreciation, which he calls last night a wonderful charge. nothing in his tax plan would change those benefits for the real estate professional carve out or the ability to use personal losses to wipe out personal income taxes, but he did say he would get rid of

carried interest, the income earned on the partner share of fund gains. his tax plan does include closing that loophole, as does hillary clinton's, but trump's plan would replace it for something possibly even more generous. the tax rate for companies, small companies, small businesses, and some partnerships would fall from 35% to 15%. it's unclear exactly what companies would benefit and qualify, but it's possible that some hedge fund managers could actually see their carried interest taxes rate go from the current 23.8% to 15%. and finally, there was a lot of debate last night about who got tax hikes and who gets tax breaks, so here's a little primer to break it down. under trump's plan, the middle class gets a break of 1% or just under $500. the top 1% would get a cut of 10 to 15%, or mornt $120,000. under clinton's plan, no change or maybe a slight increase,

that's according to the tax policy center, but the top 1% would see a 5% increase and the top .1% would see an additional $520,000 per year. guys, back to you. >> all right, robert, thank you, for truth squawking the tax debate and policies. our robert frank. let's send it over to john ford with a quick look at what's coming up on "squawk alley." john? >> vice chairman of at&t, ralph de la vega, coming up. he's going to be able to address some of the samsung galaxy note 7 problems. also an ipo plan, all that and more coming up on "squawk alley".

good morning, a showdown in st. louis last night as donald trump and hillary clinton face off in the second general election presidential debate. our "squawk alley" is live.