we see the dow higher by 1.38%, s&p by 1%. that index is higher by 2.25%. you can say what you want about trump, but the market is loving it. "closing bell" starts right now. hi. welcome to the "closing bell," everybody, i'm kelly evans here at the new york stock exchange. >> i'm bill griffeth. the dow rallying right now up 265 points. had been up 286 or 87, and it really has picked up steam in the last hour and a half or so, putting the dow on track for its 12th record closing high just since the election. >> and we've been watching this for one years now. the dow transports, they're leading the charge today and

hitting a big high for the first time in two years. those transports have been leading so far in this trump rally since the election. coming up, we'll look at if the european banks could give that sector even more room to run. >> the biotech groups not participating in this rally after trump said he wants lower prescription prices. we'll talk about potential fallout. health care overall has been the one sector that's been lower today. >> let's get to bob for the announcement on this rally. bertha coombs is also here. >> seasonally strong period of the year. you got a big one coming in late in the day and we have some rotation. telecom, real estate, consumer discretionary, tech, what do they have in common?

they were lagging. buy material names, buy bank stocks. now other names are coming forward and this is a very powerful rally now because you've got rotation going on overall here. we have a number of groups at new highs. almost 400 new highs at the nyse. there's a big engine company, cummins. another group, financials. you got citigroup, goldman's, keycorp all at big heights. names that weren't on the high list just a couple days ago. kss. we've also got best buy at new highs, and even some hotels that are breaking out. this is what i mean when the new high list starts broadening out, it's not just bank stock. host hotels at a two-week high. marriott at a two-week high.

it's a change from just buy any of the trump rally stocks to broadening out to sort of the generic growth names. when you have generic growth, gdp higher, that means the whole market starts to lift overall. very powerful forces at work right now. guys, back to you. >> all right, bob. thanks. let's go to times square. bertha coombs at the nasdaq site there. bertha? >> you got large caps and small caps doing pretty well today overall and basically it's a mirim ror image of what we saw right after the election. donald trump saying he'd like to bring down drug prices. at one point the nasdaq biotech index was down nearly 4%. if you remember the last time we saw the idea of a presidential candidate talking about prices,

hillary clinton, the sector sank 3.4%. nevertheless, this continues to be an overhang on the sector. on the other side you have western digital hitting an historic high after boosting its outlook for profits and announcing a license renewal with samsung. big tech auto names. you see the broadening of the new high list. t-mobile, paccar, micron tech. >> let's talk about the rally today in our "closing bell" exchange. maureen, john and rick checking in from chicago. john, the market theory is older than a century, the dow theory when the industrials and transports are setting highs at the same time, and art cash was

saying earlier he thinks that's part of what's causing this buying today. what do you think is going on here? >> i think it's a combination of things, and i think bob had a great lead-in here explaining all the different factors that are helping here. if you look, no corporate headlines, nobody is looking for something after the bell today or before tomorrow. it comes down to this five program everyone was talking about that came to the market shortly before 1:00, and i do think there are shorts getting squeezed. as this rally has continued mounting higher and higher, one that's out there is trying to pick this top. once they put their shorts on and they see the market trend in one direction very quickly, they have to cover in a very short period of time. volume has spiked on the activity we've seen today, so that shows me, yes, this is somewhat real. but tomorrow should be a good test. can this market sustain this rally?

we'll have to see. >> meg, what do you think about the strength and breadth of this rally? >> it's interesting because there were only a few stocks leading the financials, energy. in terms of the dow, you're looking at what, united health care, goldman sachs and carp caterpillar is really half the gain. small caps i always love. and i think there may be a lot of shorts covering, but i think there are a lot of people not wanting to miss this. and i think that this rotation into a broader diversification in the markets is good. but i must say the people who are sitting with their 60-40 balance portfolios, which means they're globally balanced, that means they have overseas, they have bonds, they're not digging the return so far. they're looking at the dow and the s&p, and they're saying, hey, what happened to me? i'm up 3 to 4%. i think as this gets broader, it's better there. i'm a little nervous about europe, although i understand

they are extending the qe that they're doing over there for another six months. it was supposed to end in march. then i need to talk to bonds, because munis have been sold off ridiculously, in my opinion, and you see huge chunks being bought by foreign governments. you see mentions by munis and insurance companies. they need yield and they can't find yield anywhere. there's $10 trillion at zero or negative rates. where are they going? they have responsibilities. i think you'll see a lot of rotation and let me ask rick what he thinks. >> rick, put this in the perspective you follow with this big equity market we're seeing. what do you see for the fixed currency markets today? >> keep in mind it's not only an equity rally here. before we hit second, third and fourth gear, we already had a pretty good rally going on in europe. the nasdaq was up 2%. and while this was all going on, we had interest rates down.

we were down six basis points in the italian tenure, a couple basis points in the euro tenure and tomorrow is an ecb meeting. i'm not saying today's activity will have something to do with what we learn after tomorrow at 8:30 eastern, but it may. the other issue is, i just find it so fascinating, people that haven't jumped onto the trump rally always seem to have the same comment. but we don't know if any of this will actually happen. when people buy stock, you don't really know when the close will occur next day. when you buy an ito for a company, think back to google, you didn't know how it would turn out. i think this rally is different in so many ways, predominantly because what the market is pricing in are good changes. change is policies that need change, need modification. i continue to say what i've said since right after the election, bill. if you're not long on these

markets, you're missing something historic, and when it comes to interest rates, i think the interest rate market will get back on track with higher rates. >> it's going to be interesting to see if this lasts. the reality is here and it's real. but what somewhat concerns me is next wednesday when the fed comes out. go back a year ago. we knew the feds were going to raise rates, the second half of that month was abyssmal, january and february the market was unprotective at that point. i think everyone's sentiment is different, but it has to be interesting to see how the market moves next week. >> thank you all for your thoughts on today's market action. >> as mentioned, this rally getting some post-reaction business. he's already using those tack

stag from air force i. >> i think the planes are too expensive. i talked to a man yesterday who had a boeing, we're going to work it out, but that's what i'm here for. i'm going to negotiate prices. >> at a rally in north carolina, he talked about the impact the trade deals are having on our deficit. >> our trade deficit now nearly $100 billion a year. we have a deficit -- think of it -- of almost $800 billion a year. you always say, who is negotiating these deals? it's a chronic. how many business people they could have done a slightly better job of negotiating. yeah, you can.

>> they named mr. trump person of the year, and in the accompanying article fts. i want to get a list of companies who have announced they are leaving. five minutes apiece. they won't be leaving, okay? >> with mr. trump doing all this negotiating, how are ceo. jeff is already writing the answer, why did god. but on the other hand, he's a how do you think they're going to deal with that, jeff? >> i think it's fine for him to come in and rattle the sabre and

shake things up. i think it's great he's able to keep them on their toes and get the ground rules visiting. i don't think he has any. he's going to have figure out and, but he could have some pretty negative unintended cons if he keeps this up. >> george, what would your advice to those ceos be if they find themselves tang ling with a scb03 electricity. if they had come to try to negotiate with him every day, they would say their board is a bunch of psycho.

>> if you're negotiating, you want to unsettle the other side, keep them on their toes, and we heard from the ceo of united technologies was just on with our jim cramer, and he said those negotiations to keep the carrier plant in the united states rather than going to mexico in part because he realized 10% of his revenue comes from the u.s. government. so, you know, you've got ceos who are going to be negotiating from fear, and that's precisely the position that donald trump wants him in, isn't it? >> it's fine to instill a little pl platitudes, but at the end of the day, a leader needs a vision and he starts.

he needs to have a plan and stick to it and be more clear. he's going, but in the long. what you're implying is that they almost kind of hand over thi thirl. wouldn't that be fair to take a fa fate. if i were a ceo, i would polite. what can we do to help keep more jobs? . what can they do without actually having to go to them? i think that's his game plan, anyway. we have about 45 minutes to

go here. 263 rmt. as we know, the financial sector has been leading this poets-election trump rally. coming up, we'll talk about whether uhre peen banks of this, designed to bring down twichl they were defending their proposed merger on capitol hill today. when we come back, find out what they said and if when we come back. elusive today. is it because so many go after it the same way? chasing after short term returns. instead if getting caught up with the crowd, the investment managers at pgim take a long term view,

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generosity is its oyou can handle being a mom for half an hour. i'm in all the way. is that understood? i don't know what she's up to, but it's not good. can't the world be my noodles and butter?

get your mind out of the gutter. mornings are for coffee and contemplation. that was a really profound observation. you got a mean case of the detox blues. don't start a war you know you're going to lose. finally you can now find all of netflix in the same place as all your other entertainment. on xfinity x1. welcome back as we watch these markets at all-time highs. the s&p 500 is up 1% today. the dow, the nasdaq, the russell all trying to go for record highs. the nasdaq has a little bit further to go. shares of under armour is also

up today. they changed from uaa to just ua. those who don't have those voting rights changed to class c. a little of that changing today. >> that stock has taken off since they even mentioned they would be changing the tickers there. some of the big winners, at&t up nearly 3%, even while jeff euckis hit the street trying to gain support for their jabber. eamon javers is here. >> the two ceos of at&t and time warner definitely got what you would call the kid glove treatment here on capitol hill today despite questions about this mass merger. the skepticism on this issue

really came from the democrats on the panel, including senator richard blumenthal from connecticut saying he was concerned that the two companies would try to use news coverage on their companies, especially that of cnn, to try to get the deal approved. he asked both men to promise they wouldn't do that. here's that moment. >> will you commit that your news coverage will in no way be influenced or impacted by what the president of the united states says about this transaction? >> yes. >> there stevenson? >> yes, sir, of course. >> then there was a moment with al franken of minnesota who expressed some frustration that said the company had the incentive to get the widest possible audience, including hbo. they had no incentive to limit that audience. franken took exception to that.

here's what he said. >> so this idea, which is this basic premise that everybody went to hbo because we guaranteed everybody would see you ain't true. >> overall, though, guys, no major road blocks here from this subcommittee on anti-trust. the purpose here, they told me today, was just to get the senators on the record to answer some questions, but nothing happened in this hearing that you could see as derailing this deal next year, guys. >> except i wonder -- you know, president-elect trump has said in the past that he would oppose this merger because he felt it concentrated too much media power into too few hands. has he softened that stance since then? >> we don't know exactly where they're going to come down in the new trump administration, but i asked randall in the hallway if he had been in touch with the trump team. he said no. randy euchis said he hadn't been in touch with the trump team,

either. there hasn't been a big desire to talk to the trump team, and the trump team is the one ultimately making the decision. >> 40 minutes left here. we have a barnburner of a rally going here. the dow at the peak was up 286 points. we're in a gain now of 259 putting it in record territory. and the transport is another standout today. right here if we close, we get an all-time high. first time in two years. >> some other all-time highs, wells fargo, jb hunt, ups, fedex. there's many more, too. what will the fed look like under president trump? who could replace janet yellen when her time is up? judy shelton will join us to weigh in on that coming up on the "closing bell." for whenever anything happens in the market. kid's a natural. but thinkorswim already lets you create custom alerts for all the things that are important to you.

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welcome back. we were just mentioning the individual names doing well in this market. how about the sectors? here's a look at the sector heat map and it's interesting how different the environmental bill is. we can tell you in one word if it was -- >> a growth strategy or defensive strategy -- >> another fang day. >> exactly. >> you have telecom in the top left at 2%. >> the stocks with president-elect trump talking about reducing drug prices, that was the fear if hillary clinton

were elected. >> and yet there are analysts saying don't read too much into that throwaway comment to time magazine. you're right, the biotech stock is down 2% today. >> dow transports gaining 2%. the last time the transports hit a record was more than two years ago, but names like matson, american airlines, jetblue, southwest, just some of stocks that had been pushing the sector higher. be sure to check out "mad money" later. jim will be talking to gary kelly at 6:00 p.m. tonight on cnbc. when you have the industrials and the transports moving at the same time and setting new highs, that usually is bullish for the stock market. keep an eye out. these records could help the

nasdaq. the stocks you should still be buying at these record highs. >> apple stock is underperforming again today compared to some of the other big tech names like microsoft or google. partly to blame could be its recent spate of battery problems on the 6s. we'll tell you about apple's latest headache and how the tech giant amims to fix it. that's coming up on "closing bell."

welcome back, the dow up 286 points. we almost hit the highs we had earlier in the session today. s&p up 26, the nasdaq up 61. western digital jumping around 8 or 9%, record 9% after it reiterated. it reached its second quarter fiscal earnings and this makes it the best performing stock inside the s&p 500 today, kelly evans. >> the big story is also the transports today. with less than half an hour to go until the close, i'm talking to mark newton.

talk about the move that's taken place here and what you think it means. >> transports just today are hitting a brand new all-time high today, so if you look at this chart, we're getting over an area that was hit almost two years ago exactly to the day. definitely an important move. this group had lagged for over two years. in 2014 everybody had concerns. now we're moving back to new high territory. particularly after the election, the rails and the airlines have really tried to catch up, so definitely a positive in the short run. all of these things hit new highs, is it time to buy? i think over the summer, that's a yes. technology hasn't caught up with the slk, but -- >> overall you think the sentiment might be too high, too euphoric, is what you're saying? this has been a real surprise today. >> it's a surprise. all of a sudden there is a kick to buy. the bottom line message is that

when these groups have lagged for so long and all of a sudden they start to move to new highs, generally it's time to be involved with it. you want to participate in the group's -- all of a sudden, joining the industrials are back to new high territory. >> this whole rally since the election is largely about the financials. is this a sign that we could have new leadership. >> the industrials have been working for some time. however, they pick up half the election when you hear things about spending, so the transp t transports in general acting very, very well. the rails started to kick in really in the last couple months, so i'm excited this group is joining energy financials. we do need to see tech and health care start to broaden this rally out before getting too much conviction that it's time to jump on board. this is still a group to own. i think it goes higher in the month of december. >> thank you, sir. >> my pleasure. >> mark newton from newton

advisers. bill? >> time now for a cnbc update from sue herrera. sue? >> spacex corporation has delayed its next launch from december 16 to early january. the company put out a brief statement indicating it's finalizing the investigation into that catastrophic explosion you see there in september of a falcon 9 rocket during a routine ground test. iran's national oil company signalling a partnership with royal dutch shell on development of a roiran's oil and gas field. hundreds of protesters gathering in front of the russian embassy in berlin to demonstrate russian involvement in the bombing of aleppo. they held up putin signs while some burned flags. on the 75th anniversary of the pearl harbor attack, senator bob dole and h.w. bush attended

a special presentation at texas a&m university. they also paid tribute to pearl harbor survivor eric cook and held a moment of silence at the exact time the bombing commenced. i'll send it back to you. >> thanks, sue. we're heading into the close here. we have records galore, but don't right them down in ink. put them down in pencil because they may not last. this is the high of the session right now, 292 points. this puts us in record territory for the s&p. the nasdaq is darn close. we're about seven points away -- six points away from an all-time high in the nasdaq and the russell is in record territory right now. >> could the european banks fuel the next leg of this rally? that's next. stay with us.

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>> look at the three stocks inside the dow that are not higher today, j and j and pfizer. that says a lot. >> there is still a lot of sensitivity about how hard donald trump's administration might be when it comes to drug prices, or maybe there is just selling of all of them. we mentioned the bioteches especially hard hit today. there we are with the dow up 300 in the close. credit swift also up today after announcing new cost measures. they had not been keeping up with the new surge among the american ones. can they turn things around and maybe feel the next leg of the rally? >> i point to the italian banks, which, interestingly, have been ripping since the referendum failed on sunday. >> that's right. >> are they expecting better times ahead, or are they going higher, expecting a bailout from

the eu? >> well, the one i can talk about is mps, and one way or another, there will abe rbe a resolution before the end of the year. or the italian government apparently has a green light from the eu to put in state money. they will bail in some of the institutional players, but they will subsidize the retail players. what's fascinating here is they don't want to have a long discussion about this because the guy who really made this mess several years ago was mario dragi when he allowed mps to merge with a very troubled bank. if you put a good bank and a bad bank together, that's what happens. politically, you get a deal. >> they are about to meet. the ucb is this week. broadly speaking, their banking

system is a mess compared to american financials. is the issue because they didn't clean up -- are they structurally different if people start seeing it rkt there is a narrative. but really, if you're going for that trade, i think you have to look at the u.s. first. italy, politically, they have been unwilling and unable to clean up the banks. you don't have the income. you can't just, and the growth rates in europe are so low that they can't. she has refused to engage on the interest of banks. >> the german economy is healthier but the banking system is as entrenched in that country as it is anywhere else. >> it is, and the french have issues with their banks.

it's part and parcel of a regime that has trended. when i. . the strength of the united states is that our found ferpz. >>. >> so what do you expect the ecb a whole line. what they should have done was fix the bank short term, do something to at least the non-performing loans they're willing to admit to and then maybe we raise some private capital after that. >> look at credit suisse up 6

points. >> they're all deemphasizing the transactional side of the for us because it was so painful and caused such problems. they're really toward ailed. so if you like that sort of molgd, i think the answer is yes. but for the commercial banks, banks like deusha to to toshl. mentment. the dow is the 300 point if we lo look. it looks like it would be a record-breaking close here. >> we'll talk about stocks even with the minutes takes a good

look the at the closings.

welcome back. the dow and s&p 500 are a minute away from closing at another

record high. bob is on the floor with more. bob? >> the market is going up, but we're getting more particular highs. breakout and industrials and the banks, just take a look. broad numbers of industrials hitting record highs. union pacific, the railroads are hitting new highs, ryder, ingersoll rand. the big money center banks like citigroup and goldman, 52-week highs in some cases, not far from historic highs. we're also getting smaller sectors breaking out, consumer discretionary, small groups. this shows you the market is sort of expanding on new highs here. kohl's and best buy and marriott international, the hotels. monday we had a mid-week buy program. don't ask me why, but it was there. seasonal market strength, number

two. number three, hopes for gdp growth. finally we've got sector rotation underway. remember the trump rally. buy financials, buy industrials, buy materials. today you see other sectors, telecom, consumer discretionary. these were groups that were big laggards in the month of november. combined with the hope for gdp growth, this is a hopeful combination we're seeing today. back to you. >> okay, bob. thank you. joining us now on the floor of the new york stock exchange, jim with the national growth fund and david seaberg is with us as well. what do you make of it as the industrials and transports setting all-time highs here? >> we've seen so many stocks melt up. our sis are getting blown out. the bank interest is around 80.

it's parabolic. we're getting to the point that the buying is really starting to slow down here. i would say in general, i think a lot of these sectors, the big inflation trade, has gone a little too far, too fast. i believe we'll pull back from these levels. you see pullback in the financials? i would be there to buy the dip, especially the regional sort of banks. those are the ones who benefit the most on this sort of trump reflector rally, if you will. >> that's all right. you're with cowen. >> i was just going to quickly ask you, david, while you're with us, health care. it's not participating today. is it reacting to the comments made by trump? >> it was supported for so long,

i was very surprised in general not to see it participate or move to higher levels given the overall tenor of the trump victory. so many people have been burned in the past several years within that space. the generalist is not ready to jump in at these levels, so it's more of a sentiment issue than anything else. >> we've got the market at close orders of as the dow comes off those highs. j jim. the russell, we've already established, is at an all-time high here. does that make it more difficult to find the value you're looking for in this market? >> the financials have taken over the russian value. we need financials to do well, to burn grocery for you.

i think as long as that happens, we're off to the races. >> one of the names is not a household name, but you expect that. zeltiq prosthetics. >> whether it's on your hips or ceme submentum -- i make up words. zeltiq is probably serving about 300,000 customers so far. their goal is to get almost 900,000 liposuction procedures in the next five years. it's not invasive, and it costs an individual about $2,000. >> you might wonder, why are we talking about stock picking?

the truth is the stock picking is lower now than when we first saw it. are you confident that this is some strategy when it deals a pure to most people. >> these types of companies are or often immune from stock markets in that they have ultimate up sides in terms of their unit volume. whether they're getting financing on the increment is really immaterial. but they're immune from the financial markets, i think, over a long period of time. >> normally we would be object assessing over tomorrow's ecb meeting or next week's fed meeting. will those meetings have the kind of impact, do you think, on this market that they've had in the past? >> no, i don't think they will. unless something comes out extremely negative. the market is paying for right now a lot of good news. that's all i'll say.

could there be something that sidetracked, the buyer from continuing to pay these high prices? it coop. in my opinion, at these levels. i think paying. then you could actually come in and buy them at cheaper levels. >> am i supposed to be buying now? >> i think there is a lot of value in consumer growth stocks. i also think the consumer has been left behind. in some of these names like dave and buster's blew out the numbers. i think these are really attractive news of three and four if you remembered.

the nyse arca airline industry is up 2% highs. american airlines, southwest, delta and election at 3 and 4%. many. this index is up more than 25%. bill, back to you guys. >> saved seaberg, and we were talking earlier, from the february 10 lows, the s&p is up 10%. the financial sector is up 45%. i guess it speaks to your sort of tenuous look at this market right now that maybe a little skepticism is healthy as this rally continues here, huh? >> look, skepticism is

important. a stock likes face books. these are next year's earnings which is the lowest multiple 1990, rough iing. you could buy that purse and. . i would say, though, we talked about financials. too far, too fast, in my opinion. i think they do pull back a little here. again, rs 80, that's a little too extreme to me. >> jim, when you look a fat

facebook, do you see those high incremental margins? >> i think i found some very high quality companies in my fund. >> i was talking about value investor last week, and i said, aren't you tempted to be a growth investor when you see the large caps that are just ripping right now, aren't you timted to go after this. i know volume many. s. they had one left behind in the trump rally. i do think a lot of these companies that were leaving the market rkt zds examine kpramplz from your world snrld.

the doolgd was just valued at 48 fomplt. if that market is valid md. but the public market is held to a much higher standard, so a locality -- lot. >> don't beat yourself up. joining us right now on the floor as we head to the close with the dow up 270 points, the dean of traders on the floor. mr. arthur cashen is here. you think the delay is due to santa claus?

>> he's showing up this year. much of the sgood december so far. >> i just juls. our art is perfectly. are you worried about a tralgt. they pushedal the average u. thn people just nild brl there will t. >> i was looking for an art das way many. >> you were pointing out earlier, bob, that the rally is broadening here. we're getting away from the sectors that have done the best post election. skb >> right, there's very powerful forces at work. with the trump rally, buy

industrials, buy materials. now since the end of november, we're seeing real estate, community staples, stocks that have lagged notably also starting to buy. you combine that with a seasonally strong period, brot ning rally for many. >> if you're just joining us, we're park. ment. >> the nasdaq is closed and we haven't gone higher here. >>ment we head to some concern, and the number of bulls are higher. some of the stand alone. something we didn't talk about

is the role these algorithms play these these that thechltz. when you fix those extreming, it's usually one searched aif yart, survey of in vess. i wonder if after years of being skeptical of raleigh's bill, you know as well as i do that we've seen new ral you will. the senator really has chajd since support. >> and a businessman in the white house may work out.

>> bob, i know you got more work to do as we head toward the close here with all time highs now for the dow, the s&p. we get ready for the "closing bell." thanks, bill. i'm kelly evans and it's a record day on wall street. the dow up 300 points. more than halfway between 19 and 20,000 on the blue chips there. the s&p 500 closing at 22.40 . that's a record high.

and the russell 2000 also on a record-setting pace, i believe, here with a nearly 1% gain. how about the dow transports today? they close at the higher level in more than two years thanks to a big rally in part in airline stocks. the transports had been sitting the market out for a couple of years now. a two and a half percent gain for the transports. there is one sector sitting it out and it's biotech. we're going to talk more about that, coming up. joining me the today for sam.

cnbc contributor if just a bit, mike, but what do you make of this market? >> it was showing a lot of resilience midday, which really manifests in vet big obvious blue chip stocks. the dow was leading. you didn't have a lot of outperformance after this little thrust happened. wa does that mean to me? people wanted to get quick exposure. obviously we're talking about a bye program. and you have yolanda rhodes was tweeting. it seemed like people got afraid the market is going to look up since we saw saw system. >> here's a couple stocks which were at all time highs today t. the stock exchange, ice, rice

fargo, ito. >> is the prospect of actual movement, actual hernl inject a note of caution here, while there is upside risk in that movement, there is also downside risk as well as donald trump starts to flush out his possibilities. our sources told us that he was talking about lowering the tax rates to 15% for the wealthiest americans. that is in direct contribution to what steven mnuchi, there will be no absolute tax cuts. the point is is there's division and we're not exactly sure what those policies will be, and until there is more clarity, right now the markets will be betting on the up side. >> steve, do you need more clarity? >> i think the market right now is just excited that there's

different leadership. it doesn't matter -- hillary clinton would have been status quo. now there's pro growth, now there's better taxation polic s policies. you said there's something for everybody? it was their position trade that they didn't see coming at all sides. >> this has been such a huge move in a couple weeks. >> so the things you would buy if you really thought you were going to have an acceleration in modest growth. acceleration plus real growth is the signature stuff that's well known. you came into this election just not. the auto parts sector was a 5 or 6% today. so all this stuff is kind of feeding into your why would. can i also just say european financials were up 3% today. that has nod with the.

>> they reached for energy, they reached for financial md. . it supposed to be real sensitive and not perform as well. jim, tell us what you would be buying in this market. >> i think it's all down to scott. what we've had since the election is a reechld, copper is down by mother-in-law. all you have left right now is this buy and panic going around in stongs. i don't think it means we'll have a bare market for two years, but i think we're happy

to inflationary cycles and what was very unlikely to start records again. we talk about the c meeting next week. it's almost a non-event at this point, but what happens in 2017. we have weerg about this all year long. >> he let's catch up with what's happening where you are. >> interesting today, we had the nasdaq just shy of a record but where was the real strength being from saemt. buy american, buy small. th then.

wendy's, cheesecake being. >> you also had the lines . banking today are moving on to new highs as well. biotech, as you mentioned, kelly, sitting out that rally. that risk we may see some regulatory risks. barack obama said in his interview he would like to bring down drug prices. let's not forget his second nominee tom price is not interested in negotiating gun prices. he may say that. that doesn't necessarily mean it will translate into government policy. >> pir, d. a lot of highs today. >> it was a very fun nil ral did i. the ral did i started very

quietly, we 7 of the. . . . why the overall rally here? we're in the milgd of some very powerful forces. besides the buy program we had in the milgd of the day, he have expansion of pdb growth, that means better know. . overall they were the, that's a very powerful move to t the. new highs right a krots the bould boulderment of the we had several dozen big industrial

named like the railroads, coming to the engines group. we had neuheisel every day for two weeks now. this is the story that aif. some of did a bit period of time. fblg, adds berth i mentioned, drugs and biotech having a very rough day. yesterday was boeing. we sole pushing stocks at the end of the . >> bob mentioned the consumer side of things which i actually keep keying on because it's not is. the consumer finance stocks were

the leaders among financials twoed. totes the. fmt. we would start talking about sort of year-end rallies at this point. there is and support the rally to keep going. we've had three januarys in a row, so you do wonder if there is something about that seasonal effect which combines with what you said earlier, which is what happens when this all starts to happen? >> something bertha said that i thought was interesting, what donald trump says may not become policy. when have we ever said that about a president? it may not make it to congress, but if his own administration doesn't adopt the policies while it's fact for them, thaet a very different environment that we keep under. >> that's the iflt, the biggest

reform we've seen in 30 years, basically. ma many. >> how many congressional committee chairman cha-- what, you're going to close my loophole? >> they want to remove those brackets, and it is a tail wint. >> the other side of the coin is balancing the budget in all of that? what's your appear tights of tax cuts versus more of a laser focus on the fiscal side? >> yeah. first of all, i think as far as the market goes, it's priced in a lot of the good news we talked about. it's already in the market, it has to be delivered or i think

the market is going to end up right. on the fiscal will come at a cost and it will come at a of to maybe try and alleve kbrit. it will be a question on the fiscal side, too. when he talks about all the things he's going to do, there is a price tag to it and we seem to have ignored it. that may be the story in 71? what about all this. >> i talked to an aide to mitch mcconnell, he said. they're way of oversfichlt. they don't want to push something through and then just have it repealed later.

they need bipartisan support for it in order to make sure the taxes are long lasting. >> one thing con stit bentz when they talk jobs, when they talk involve ready. i know this was. jim, appreciate this as well. be sure to. tim hockey will be there to weigh in. the stocks are moving. courtney reagan has the numbers. court? >> numbers big on some pretty heavy volume here after hours. lululemon slightly stronger. komps also strong. total comparable sales up 7%. the street was looking for komps

to come in a little over 5%. just the store comps at 4%, better than what the street had been looking for there, too, at 3.2%. however, a light revenue and ups guidance for the fourth quarter, and the ceo says the fourth quarter actually began with mixed sales results but have since improved. so not the greatest guidance th. this quarter was still pretty good. they were up about 5% during the trade today. >> wow, courtney, thank you. 60% higher on lululemon on light guidance? >> people are in a mood to believe. the stock has had a very within a tight range sawtooth pattern well above the highs of last year. still 15 or 16% of stocks are short, so you might have had people caught off guard there as well.

>>. >> i have more than enough yoga pans. in all the encloses. up next, two stock pickers tell us where you can still find value in this market, and the transports hit an all-time high today. finally a top analyst weighs in with his best ideas in the sector later. you're watching cnbc, first in business worldwide. is happening before our eyes. shift in human history

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the nasdaq just short of its high but the dow with a gain today. some fresh records again since election day. which stocks should you buy with the market at these levels? joining us now is david pearl from ethnic investment partners and from aerial investments. charlie, i'm just going to let you take a victory lap here on the financials. >> thank you. it's been kind of boring. every time you have me on your show i say safe stocks are expensive and bonds are expensive, and finally, for

reasons none of us predicted, things are going well. >> zimmer holdings, tell us why these names pop up for investors. >> because they're still cheap. kkr, because of its structure, as a partnership, is not in any of the indexes, so it's underowned. we think kkr is trading for about $16. the value of their portfolio is way up borgwarner is way up. we think it will be stronger. a stronger general economy kept at these levels. and borgwarner is just very, very cheap. zimmer, the population keeps getting older. hips and knees will be in demand. that stock is very weak. it's trading at about 104.

>> dave, what do you like? >> we like hexcel. they make boeing's new aircraft lighter, therefore more fuel efficient, which is more important since energy prices have gone up. high payback and it clearly is benefiting by a stronger economy. plus they're an exporter to some degree. that will be a benefit in this new administration. so we like that. applied materials makes the machinery to make semiconductors. it's not just the volume of semis which has been going up quite rapidly with the economy, but new products. we're all going to organic led screens and iphones next year, and we're going to 3-d nan which means you'll have more memory in those cell phones. >> what about cme? >> cme is the stronger for derivatives in futures and options but particularly

futures. whenever there is volatility moving in the market, like interest rates finally going up, they are dominant in that. energy contracts are up 30% year over year. so if you predict that rates may go up further, that there's more volatility, these are the things to own. cme pays out 100% of its profit every year. so it effectively has a 5% dividend plus the growth seems to be in the high double digits given the volatility of the markets. >> charlie, i just wanted to drill in a little bit on borgwarner. you say it's still cheap. it's up 17% in a week, so is that people just belatedly saying we're going to price this all at once, or is there something fundamentaling that may be kicking in. >> that's a good question. i got a little nervous with the big move today. it is a name trading for 7 times.

it's hard to find stocks trading for that low a multiple cash flow, so if you're trying to do a buyout, maybe it would be borgwarner. >> thank you for joining us. talking about names that still look attractive to them in this market. costco is also reporting its earnings this hour. >> costco reporting $1.17 adjusted for the first quarter earnings. the season a little light than what they were looking for. there is a charge they had to account for and that's part of the reason. revenue coming in a little lighter, at just $28 billion. remember costco still reports monthly comps so we know that had previously come in at 1% and that's where we're still sitting. you can see the shares after hours are down about 1%. kelly? >> people will be digging more into those results. costco shares down about 1% at this point. president-elect trump is announcing another pick for his

administration. john harwood has the latest. john? >> reporter: kelly, linda mcmann, the cofounder and chief executive of worldwide wrestling is going to be the head of the small business administration if confirmed by the senate. donald trump just announced that. now, linda mcmann is a former republican candidate for the united states senate. she lost to the democratic incumbent richard blumenthal. she also contributed amounts of money to the trump foundation. we've all seen the video of donald trump at a professional wrestling match, so this is a relationship that is being turned in to the head of the small business administration for linda mcmann, guys. >> john, what do you think is most significant about the sba role? >> well, the sba is there to facilitate lending to small businesses and helping them

overcome red tape and other difficulties in getting going. obviously donald trump comes out of the business world. he's not what you would call a small businessman, but he has got deep connections to figures in the business community all over the country and all over the world. and he is going to put that business sensibility to work at the sba. >> all right. john harwood with the latest on one of trump's picks being announced this afternoon with linda mcmann by sba. as donald trump promised in time magazine to lower drug prices. we'll find out what that means for that industry, next. >> and we'll speak to a top trump adviser who some people say could be a candidate for the central bank. stay with us. ience simple

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so i brought in my comfort pony, warren, to help me deal. isn't that right warren? well, you could get support from thinkorswim's in-app chat. it lets you chat and share your screen directly with a live person right from the app, so you don't need a comfort pony. oh, so what about my motivational meerkat? in-app chat on thinkorswim. only at td ameritrade. finallily it's the first record high for more than two years for the index. let's bring in a senior research analyst for avondale partners. great to have you with us on a day like this, sir, and what do you make of this move in the transports? >> good to be here. let's look at what happened, let's look at the history. if you look at the fall of '14 and the spring of '15, we had the collapse of the price of oil and natural gas and the big rise

in the price of the dollar, and that's what set off an industrial recession in the united states. all of us expected the consumer to spend more money, that dividend they got from a lower cost of heating and cooling their house, the lower cost of their commute. we expected them to spend it. they didn't. but we've seen the price of oil come back. the industrial recession has stopped getting worse showing us that it may be in the early stages of a recovery, and more importantly, confidence in the consumer means they're starting to spend some of that dividend of the lower cost of the commute and lower cost of heating and cooling their house. you see it in truck tonnage, you see it in air flights. the volume was up 10.5%. the atlantic volume was up 3.6%. we're seeing a pretty big jump in the spot rate in the trump market. all in all it looks more and more positive. >> don, you didn't mention, at

least not drebtly, tirectly, thn terms of what it might be there, to see whether there are any trade restrictions or frictions with mexico. >> i tend to be cautious about rails because rails don't like the strong dollar. the dollar was already strong. it's only gotten stronger. while oil has recovered from the 30 level back up to the 40, 50 level, it wasn't 89 or 100 which is what we need to get another big oil fracking boom. rails don't like strong exports. it doesn't help with shoring manufacturing. other parts of the e-commerce i tend to be very bullish about, because not only are we seeing the consumer spend, but when the consumer spends, they're spending more and more e-tailing. >> i want to ask you about infrastructure spending. there is more hope for a large

infrastructure package. do you think that's too optimistic? what's your take? >> i don't think it's too optimistic, but let's be cautious about what we price into stocks. in short term that would be good for rails because you have to move the steel, you have to move the cement, you have to move the aggregate, the gravel, et cetera, to build the road, the bridge. but in the long term, actually that's not positive for rail. it's very positive for trucks because it's the trucks that get to use all that improved infrastructure. >> so, donald, going back to where you think the transport is at a record high now and all the things we've discussed, who are your favorite names here at the sector at this point? >> we continue to be big bulls on shares of companies like fedex because they deliver e-commerce. companies like xpo logistics because they deliver those large packages. they have the largest last mile for things like refrigerators and barbecue grills. because it's amazing, we're not only seeing a greater and

greater depth of penetration of e-commerce, but we're also seeing breadth. we literally are ordering everything on the internet. >> are you looking at my amazon past orders here? it's embarrassing what i order. it's cat toys, it's -- >> it's true for all of us. >> -- it's toothbrushes -- >> amazon started selling us books and now we buy not only the books but we buy the bookcases, the libraries, the wine cellular, you name it. >> so true. thanks for joining us. >> the big, bulky items are -- thank you very much. >> it will be interesting to see how they handle all those door-to-door deliveries. s sue? >> authorities have charged two juveniles for starting that east tennessee wildfire that killed four people and destroyed or damaged more than 200 buildings. they face raggravated arson

charges. they are under age so their names are not released. the fighter jet like you're seeing there crashed into the sea in western japan. helicopters and ships are on their way to that location about 260 miles offshore to search for pit lot. italian premier renzi has resigned. the italian president asked him to take on in a caretaker role until the new government can be put into place. 75 years after the attack on pearl harbor, thousands gathered there to remember the day that president franklin roosevelt said we'll live in infamy. the ceremony was held on a pier of the u.s. harbor where a u.s. ship sank. kelly, back to you. we spoke about those transports leading higher today. with the index at an all-time

high, will it push us into 2017? how to set up your portfolio for newt year, next. the nasdaq performing higher today but under big tech names like apple and google. is now the time to buy tech? stay tuned. is my headquarters. this is where i trade and manage my portfolio. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities- trade confirmed- and i have global access 24/7. meaning i can do what i need to do, then i can focus on what i want to do. visit learnfuturestoday.com to see what adding futures can do for you.

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same for the s&p up 29 points to 2241 and the russell small caps up 1364. the nasdaq shy of where it needs to close for a new high, 5393, today up about 60 points. one sector that sent out the rally is biotech. those shares falling on the back of comments by president-elect donald trump in his time interview for person of the year. here's the key quote from that piece. trump says his goal has not wavered. quote, i'm going to bring down drug prices. i don't like what's happened to

drug prices. that's it. those comments alone put fear in the market today. should pharmaceutical and bio companies be concerned? with me is jeremy levin, the former tev pharmaceutical ceo. great to have you with us today. what do you make of the general theme and tone you see shaping up from the trump administration? should biotech be worried? >> thank you, kelly. great to be with you and great chance to talk about this a bit. th this is a story which is not unexpected. this is consistent with president-elect trump's comments throughout the campaign and it's also something the industry has been well aware of for a long time. i think as we look at the industry which we need to sort of understand that this industry is one which is committed to innovation, the idea that you will find great medicines and that this nation, which is the greatest producer of those medicines and innovation will find ways to work with and is committed to work with the administration.

so i think as you look at this in the short term, of course, there's concern, but as you look to this over the mid to long-term, i think we are a very robust industry, and i think any new administration is one that we can work with. >> so jeremy, as investors look at this sector, they're concerned, it seems to me, about two things. one is just a general scrutiny or clamp-down on drug pricing for existing drugs. on the other hand, the pace of approval for new potential drugs which, by all indications, the president-elect seems to want to speed that process along. it seems to me from an investors' point of view, you can have winners and losers depending on the sort of company, whether it's a pure biotech or an existing pharmaceutical company that try to jack up prices on existing comments. >> accurate comment, and those who have an old product and consistently raise prices and don't try to innovate, any legislation that deals with that kind of approach as distinguished from approaches that are dealing with companies

that need the ip protection, the intellectual property protection, to allow them to invest, take huge risks to develop highly innovative drugs, we could see a segmentation to that, and i don't think that's necessarily to the bad. i think what we should focus on are what are the steps we can work with increasing the regulation that can help regulatory approvals more rapidly, how can we strengthen the barriers to people taking away and defeating innovation, and deeply strengthening innovation? at the same time, i think those people who depend in their companies on consistently raising only one drug are basically not the ones that we should be focusing on. so i think there is a lot of opportunity here to create a very, very robust environment for innovation. >> jeremy, let me ask you before we go to kind of put yourself in the shoes of the investors here. they see the sector being sold off broadly and this kind of

blanket political concern sufficient indicating shares of a lot of these companies. so, tactically, who are the right people to invest in here over the longer term? >> kelly, you and your team are far better at this than me. i've been through this many, many times and decades in the industry. it goes up, it goes down. i think where investors really need to think about is where is innovation? where are those companies building sustainable pipelines? where are new types of meds to attack alzheimer's, new types of meds to defeat disorders? the world needs it and america produces those medicines. we are by far the best industry of this kind in the world. it is truly a phenomenon of america. i think investors need to discriminate between those trying to innovate versus those

who are actually simply riding on the backs of discoveries decades ago. >> but mike, it seems like a lot of that only happens after the fact. when there is one report of what a company is doing with drug prices, they can say, i guess they weren't one of the good guys. >> and they aren't currently trying to discern one from oert because it is very cloudy in terms of what the measures might be. are they pronouncements to dissuade these companies from price increases? it creates a chilling effect. it's very hard to know cannotly whe -- exactly where it goi's goin. >> jeremy, we appreciate your time today. sue herrera, what do you have? >> basically this is in the wake of the referendum in italy we've been covering so extensively on cnbc. italy is changing moody's issuer

rating to 2 negative, but it secures the bond rating. the one they have downgraded to negative is italy's bw 2 issuer long term rating. kelly, back to you. >> thank you, sue. it's exactly what we were saying earlier with chris whalen. it's a chicken and egg problem. how do you fix the problem without the banks or the banks without the growth? a challenge for italy here. we'll watch their debt yields. thank you, sue. >> by the way, italy is the third biggest bond market in the world. stocks rally since the close of the election. we'll look at the biggest change in the rally that could be the federal reserve. apple sitting this one out. they're flat since the election and we'll discuss whether there is an opportunity to buy apple right now, when we come back.

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>> i think this stock is overvalued. this has really been the jason bourne of the tech world in 2016. china came and doubled down after trump was elected with threats against apple. we obviously have the eu, we have iphone cuts out there, we have battery issues. we've had a whole host of problems around the apple story. we've actually seen a little bit of the doom and gloom seep back into the story the past couple weeks. >> you still have a great price category here. >> we talked about this before. the market at 16, sugar water at 22. i think one of the things apple could do a better job at is hiking this dividend. we talked about that today. peers like cisco, 3.5 dividend yield. apple should go for it, provide some stability for this period. >> cisco's dividend yield was higher than its own bond yields

for a while, which would probably be the case for apple as well, but it didn't get action higher. are you simply saying to wait for a while? >> exactly. i think you detract a new group of shareholders that would really weather the storms. apple is so news driven and a lot of the web sites get a lot of hits when they talk about apple. when it gets negative, it gets hugely negative. when it gets positive, it gets overly positive. this would kind of weather the storm a little bit better with a higher dividend yield. >> with that kind of payout, how contingent would that be on the trump administration doing something with having a lower repatriation tax that, kind of thing. do we have to walt fit for thos dominoes to fall into place, or could they do that now? >> they can do that now. they'll say, look, our stock is undervalued, we want to buy more here. i look at it as let's expand the investor base. >> it used to be the number one widely held stock. this was not exactly underowned.

>> the deep valued don't own it. when you have these volume periods and doom and gloom cycles, it's so volatile it actually wrecked devaluation. the iphone is coming out, i don't want to own this in this quarter. >> trump said he talked to tim cook and he talked to apple about possibly opening up a factory in the u.s. pie in the sky, or do you think there is anything real behind that? >> would you like it if they did that? >> if they did it in mass volume, a lot of people would not be able to afford an iphone. but i think you can actually go out there and make a symbolic gesture and give it a shot. they did this with the mac pro with flextronics. you could automate. but when they automate, there won't be that many jobs.

>> are we stealing from that? is that what we're looking at as an investor right now? >> holidays are clearly a positive. as you get into next year, people are anticipating the iphone 8. i'd like to see more news flow around newer products we did over the weekend around a self-driving car. because like i said before, you know, everything is going to become a computer. apple is the only company, hardware/software together, it fights fits right into their wheelhouse. today's record-setting rally has set the trump rally into the background. we hear from one of trump's economic advisers on today's rally and trump's fed plans. stay with us.

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welcome back. another record-breaking day for the stock market with the dow up nearly 300 points. but could the federal reserve derail this rally? joining us is judy shelton, a must be of the trump economic advisory council and reportedly a candidate to fill one of two empty fed spots. judy, thank you for joining us. >> thank you for asking me. >> we had to put that out there. any comment on what fed role you might take? >> no, no. its a privilege to be involved in the transition effort. i'm very excited for the future of our country. i think that the economic prospects are really looking up, and that's my main focus at this point. >> well, the fed -- you know, we were just saying earlier, since trump won the election, that's the far more important factor to the market than the last couple weeks. there is a meeting next week and reportedly will probably raise interest rates. do you think that's a factor if that happened that it could

actually put an end to the rally we have seen in the market here? >> well, the market has completely priced that in. and if raising interest rates a quarter of one percentage point, when everyone is expecting it would cause the market to experience some kind of turmoil, then things are a lot more fragile than we thought. and i think what's really important is that what president-elect trump has pledged to do is put our country on a solid footing. we really shouldn't have the federal reserve driving the economy. monetary stimulus is quite limited, really. what you want is productive growth and the kind of growth that is truly stimulated by tax reform, by regulatory reform, trade reform, and important infrastructure project to upgrade our ability to be more

productive as a nation. it's funny that for a long time, people said there was so much uncertainty associated with the election that that would be hurting economic prospects and troubling markets. i think what we're seeing now is a widespread certainty that things are going to get much better. >> yeah. >> and i think that's what markets are reflecting. >> judy, this is elan from the "washington post." you warned our international situation is precarious, called it a nonsystem. what do you mean by that? and you talked about the role of gold and providing an anchor for money in the past. can you explain your viewpoint? >> well, i said what we have, actually, is worse than a nonsystem. it's an anti system. and in saying that, i'm quoting jack de la rosier, a former head of the international monetary fund. and if you think back to the

idea of free trade and what certainly the united states was trying to do, along with our strong partner, the united kingdom, as world war ii was coming to a close, is we wanted to have a trading platform that didn't allow countries to depreciate the currencies. because we know that really is not -- well, it's called competitive depreciation, but it's not really competing. it's cheating. and what president-elect trump has pointed out is that as much as he is a free trader and belongs strongly in the principles of competition and free trade, he is saying, quite strongly, that when a country resorts to devaluing its currency, that is an anathema to free trade, against principles and united states, our workers have paid a price for cases in the past where countries have engaged in currency

depreciation, and i think he wants to focus on setting us up on a more solid basis so that the trade we do conduct does not permit those sorts of tactics. >> judy, we hope you'll come back and join us going forward to talk about these issues. >> thanks very much. >> judy shelton is a member of the trump economic advisory council. up next, the trump trillion. we'll have the details, right after the break.

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welcome back. a huge rally on wall street today, sending stocks to all-time highs and if you add the s&p 500, the mid caps and small caps together, the gains are a total of more than $1 trillion in u.s. equities. so i think we could call that the trump trillion at this point. >> >> you could certainly call it that. a lot of it talked about how it basically was an acceleration of trends that seemed to be percolating before the election. i am also interested in a few more points in the s&p 500. 10% year-to-date. >> wow. >> so 10% is in the realm of how bull markets act. >> and as we look ahead, elan, what do you have your eye on? >> i'm not sure what's coming up next. i've looked to twitter 24/7

these days to see what donald trump is going to say. >> ecb tomorrow. my ears are peeled for some kind of a potential surprise. >> you know, that might happen. but i'm with elon here, it's not about the ecb. it's not even about the fed. >> you should go to twitter. you're missing all of the action, kelly. >> i get it everywhere else. "fast money" begins right now. "fast money" starts right now. that is a picture of america getting rich as the trump rally has officially gone wild. a huge day on wall street with the three major indices near a record highway. the dow jumping 300 points. and it's not just the banks and materials. the trump trade is a standing, two of the best sectors and everything up 1% or more except for energy and health care. simple question tonight is this. what trump trades can you still get in on? pete najarian, kick it off.