federal flood insurance program. it's going into the islands and bearing down on the virgin islands which may get hit very happen, puerto rico, the dominican republic, haiti. the last thing haiti needs obviously is a category 5 storm. >> yeah, something to watch for. >> it's a very scary and serious situation, guys. thank you. thank you all for watching "power lunch." >> "closing bell" starts right now. >> hello, everybody, and welcome to "closing bell." i'm kelly evans at the new york stock exchange. >> and i'm bill griffeth. >> good to be back together. >> nice to be back together here finally. summer is over, and 9 selling has bug. investors getting concerned about the nuclear threat from north korea, concerns that tax reform can be further delays i mean, there's a whole list here that we could go through and we will go through. >> just about the only thing to smile about is this reunion. yes. >> everything else is gloom and doom and can you see that across the markets. the dow is down 277 points and

the lows down 234 right now and it's a broad selloff financials are actually the hardest hit. you can see the yield on the ten-year approaching 2%. investors are piling into safe haven assets like the treasures. we'll talk to the ameritrade chief strategist on whether americans are doing buying on the dips. >> mohamed el-erian on whether geopolitical concerns could get worse and whether the fed could put any further rate hikes on hold as a result. >> oh, boy. >> right that's on the table right now as well. >> let's begin with seema mody here on the floor of what's driving the selloff on wall street today seema? >> kelly and bill, the calendar may say it's summer, but it certainly feels like fall, a lot of traders reminding me historically september is the worst performing month as traders return to their desk goldman sachs, one of the most heavily traded names, surpassing

its 30 day volume average, about 4.3 million shares have exchanged hands. it's down just about 3.5%, the second worth of we are forming stock and shading off 25 point on the day and the selloff is not confined to goldman sachs. many of the names, morgan stanley, bank of america, down 2% 203%. many pegging this to the flattening yield curve on the back of the north korean geopolitical risk and peter boockvar says this has much to do about monetary policy and tightening ahead of the central bank meeting on thursday where we're expecting some type of verbiage from the central bank governor mario draghi on the currency and bond-buying program as well. as we take a look at the big movers, take a look at united technology, the huge deal in the aerospace sector, a $30 billion deal or $140 a share in cash and stock market equity a big part of the deal. that's why some analysts say that could impact united's

earnings in the near term. if there's a silver lining or a gold lining in any of those. take a look at gold. now up 10% over the past two months trading at the highest levels of the year a lot of gold miners got hit guys, that's the story there back to you. >> seema, thank you. we'll see you at the close another issue facing the market, maybe the primary for some those increasing tensions with north korea after that huge bomb test over the weekend. nbc's ron allen is in seoul, south korea, with the latest details. ron? >> good afternoon. the situation here keeps escalating again today, too, amid reports that there's indications that the north koreans are planning to launch more missiles perhaps as soon as this weekend there's a major holiday in north korea, a time when the north tends to take these actions to celebrate, if you will, so that's driving the tension here to another level on the south korean side,

another day of massive military exercises. these things are happening now just about every day this time a naval operation in the past there have been operations simulating bombing runs on destroying an enemy leadership there have been simulated runs to knock out north korea's testing sites as well. we know president trump and his counterpart have been in consultations as well as u.s. and other south korean officials. there's talk of increasing the side of the ministries in south korea and talk of possibly deploying tactical nuclear weapons in south korea which would be a huge step for this country, so a lot of talk about military -- military hardware upping the ante here president trump has also said he's going to take it possible for the south koreans and the japanese to buy billions of dollars in hardware and advanced weapons systems, another step forward on the military side of thing increase the tension here as well. also interesting comment from

the russians today vladimir putin had a conference said that he described all of this as military his tier yeah, and he said that the world was headed for global catastrophe because that's happening and he again said sanctions are not going to work. that's what the united states is doing, pushing for tougher sanctions at the u.n. security council and targeting oil supplies or companies and countries that do business with the north korean business which referred to china. something that the chinese have tried to block at the security council, so, again, another day of tension more escalation here on the north side and on the south side of the border, and, again, a lot of eyes looking forward to this anniversary, this weekend when there are indications and reports that the north koreans may be planning to launch more missiles back to you guys. >> all right nbc's ron allen there in seoul thank you, ron, and we'll have more on the possible impact of those increased sanctions a little later in this hour of "closing bell.

let's get to the "closing bell" exchange right now we're off the lows and that's not saying right now jim paulsen is with us right now and steven sarge gillfoil and holly list checks in from chicago. sarge, is this a year or a fundamental selloff today, you know what i mean >> i think we all expected some profit-taking on friday after the month end rebalancing and you have that today, and you've got the geopolitical tension with north korea putting little bit of weight on the marketplace. this is not a major selloff. we got support of 2446 on the s&p 500. that's precisely where you needed to see it if you follow along with the andrews pitch fork theory placing the start of the model on election night. everything okay. right now it's not broken. if you see a break at 2446 then we have other issues, but let's face it, right now the major weight on the domestic marketplace is the budget.

it is the debt ceiling those are temporary issues going forward you still have a growing economy and still have low inflation and earnings expansion. you still have reasons to be in stocks, and i do think the market will go higher. >> jim, it's interesting last week when hurricane harvey hit there was a sense that perhaps passing some relief on that front would actually bring congress together on issues like funding the government and raise the debt ceiling and so forth. what to you think about that today? i mean, has that idea changed. now you, of course, have the d.r.e.a.m.ers. that deadline is coming up in march alongside maybe tax reform so is it the people that lost faith about, you know, these kind of agenda items or do you think this is all about the north korea threat >> you know, i think it's about a wave of different issues impressed by the number of things you're supposed to be worried about, kelly the values are too high and vix is too low you've got bad calendar seasonals. you've got geopolitical risk the president can't get out of

his own way. nuclear holocaust, harvey. there's just so much, but the one thing that isn't there is the economy is doing real well, you know we came off a 3% quarter we're probably in another 3% quarter as we speak, and -- and i like the fact that we've got pretty decent growth, and i think we're stimulating that growth look what we've done since harvey we've dropped yields, bond yields we've dropped the dollar we're stimulating an already accelerating economy, and i think i would look ahead and maybe -- i don't know the rest of this month. who knows, but i think if you look ahead a few months we'll have even a better global growing economy i think than we do now, and it will come after maybe a bit of a selloff and a fear-based selloff and people will have to re-establish positions. i think it's a good buying opportunity. it could go on for longer, but i think on days like today it's good to have your shopping list rather than your sell list. >> almost like we're a bunch of hypoconnediacs in search ofcism

tmz and all coming up with that list of worries there. we find ourselves with yields at the lowest level of the year and gold at the highest level of the year so clearly the safety trade is in play what do you make of that is there more to come there, do you think? >> i think there probably is, and it isn't all just due to flight to safety clearly that's having an impact on us today what's going on in korea, what's going on with the hurricanes and what not, so it's clearly a flight to quality and the best quality you're going to find is u.s. treasuries, so that's putting a lot of the demand in that we're seeing today but on top that have you also did have weak economic numbers. even though there's other events going on there's still economic data being released and the durable goods this morning was weaker than had been expected they thought it would be revised higher and it wasn't, so you've got this weak economic data today, and then you also had one of the federal governors talking now. governor brainard, she's a permanent voting member, and she does come out on the dovish side and she certainly made that

point today when she said she thought they should go easy on additional rate hikes until they sees signs of inflation, and even though we have within seeing good growth in the economic, good labor numbers, we aren't seeing the type of inflation numbers that they would like to see, and i think that right now is a bit more critical for them, so all those factors together are giving us this flight to safety and demand for treasuries i think that is going to continue even though we've hit the low for the year in ten-years at 2.70 and change, we could go down to 1.82 and a lot of elements that we'll see today will propel it there. >> mean time, sarge, raytheon is not surprising looking at what's going hon in the world, but why do you think boeing is not having as good a session especially with its favorable ruling. >> i myself in the defense area, ike in lockheed and others and

i've thought about broadening it to including boeing and jen dynamics if i go to 10% to 10% allegation in my portfolio i'd probably include boeing. >> financials are the biggest hit sector in the s&p today. technology is not far behind do you like those -- if you're looking for buying opportunities as you mentioned, are those the sectors to look at, or where else are you looking at right now? >> well, i like -- i think, bill, that there is some size of inflation here and overheat going on and still very full of growing and industrial commodity prices have been on fire and have been so the past few years. the industrial part of the economy, and now if we get oil embroiled it it, the dollar is weak which is forced net so i

look at more of the industrial commodity cap with goods areas, industrials, materials, energy stocks and then financials for sure because if we get an influence bias now when everyone has given up on it you'll see yields have to adjust upward and that's going to play right into making the financial stocks leaders again and i'd focus on those areas and i still like the oversees markets more than the united states. >> it will be tough on financials if we go to 181 on the ten-year. >> holly, last year it sounded way off, and now today we're almost right there >> thank you, folks. >> thank you very much. >> see you later thanks for your thoughts on today's market action. we have news right now out of washington ylan mui has details on us. >> former president barack obama has issued a lengthy statement on facebook criticizing president trump's decision to end the daca program he called it cruel, the decision is cruel and said that it casts a shadow over some of our best

and brightest young people now president barack obama also defensed his own decision to institute the program saying congress would never sent him a bill to sign that would reform the immigration system and the former president said kicking out the undocumented immigrants won't lower the unemployment rate and former president obama says let's be clear the action taken today isn't required legally. it's a political decision and a moral question he also goes on to say that that is why businesses have come out in support of the daca program because they feel like it is a question of basic human decency. back over to you sglempt thank you. ylan mui there in washington we are headed to the close here with about 47 minutes left in the trading session off the lows, but, still, roughly 1%

declines for most of the averages coming up, mohamed el-erian weighs in on the selloff and whether it's a buying opportunity or the start of a bigger pullback. >> and united technologies is one of the biggest drags on the dow after its massive deal to acquire rockwell collins and now other aerospace companies are raising that with the merger and we'll tell you about that next. >> you can reach out at the show and fine us on twitter and on facebook and send us an e-mail and the full spectrum of ways to communicate with us. you're watching cnbc, business in -- first in business worldwide.

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kelloff day to begin this shortened trading week the dow was down, what was it

down, 277 point, was it is >> and really all the major averages have taken their turn at having the biggest decline percentage-wise today, the dow, the nasdaq and russ rell, only the s&p, and the s&p sitting right on a number of traders watching very carefully. we'll talk about that with one of the traders later at 2455, something to keep an eye on for the s&p 500 index. let's take a look at the market movers home dew point has been among the best performers and maybe the home improvement retailer would ben fite from hurrican irma which could hit florida this weekend meanwhile bank of america reinstated coverage of both home depot and rival lows with a buy rate because of a strong home improvement spending growth lately insurance giant travelers is one of the worst dow components as investors are worried, of course, about the potential huge losses from harvey and now the

looming hurricane irma. >> which looks horrible every time we see the satellite pictures it looks like it will swallow up all the islands. united technologies is the biggest loser, down 5% after announcing its acquisition of rockwell collins phil lebeau has more on why investors aren't so happy about this deal. phil >> it's a prissy deal, kelly that's one reason why. it's a 25% premium basically if you go back to where rockwell collins was where this was, just north of 1 so take a look at the stocks around august 1st, that's when you saw the move president in rockwell collins, when word came out that there is a potential deal and it's creating a huge aerospace supplier in fact, utc aerospace is going to be combined with rockwell collins and they will call it collinsware space, the combination of those two it will be the largest aerospace supplier think of them as supplying the

brands of the airplane, if full, with avianics being the key because it drives higher marginsch here's the ceo greg hayes talking about how much growth he sees in the aerospace industry over the next several years. >> aerospace business is growing dramatically we see revenue passenger miles up 5% every year growth is coming in the aerospace business, but with that growth comes pressure from the customers to take costs out and continue to innovate and having scale in the aerospace business is absolutely essential. if you can deliver the value to the customers that they expect >> and who is one of the largest customers for united technologies, boeing because it's the utc technology that goes into the planes and boeing is not happy about the deal issuing a statement saying should we determine this deal is inconsistent with those interests, the interests being keeping costs as low as possible for the airlines that ultimately buy these planes, we would intend to exercise our

contractual rights and pursue the appropriate regulatory options to protect our interests. take a look at shares of boeing and keep in mind that boeing has recently formed an avionics division of its own, so it wants to get into the high margin business, the brains of the plane, if you will it already is in that area to a small extent but rockwell collins combined with united technologies, guys, that would give them a lot of pricing power over the boeings, the airbuses, any of the airplane-makers, and that's what is concerns boeing about this deal. >> you know what i found interesting. two things when they talked with greg hayes earlier today acknowledging the rich premium when you buy beach front property, you're going to pay a premium and he said after we combine these two companies and get some debt paid down, if it's not working, we'll just split it up again i mean, he was pretty frank about that right up front. >> right if you take carrier and the building side of the equation

for united technologies, the slower growing part of the business, which, by the way, it's great cash generation that's the appeal of otis elevators. if you take that and up move it away from the aerospace business, bill, look at the growth and the margins on the aerospace side of the business i mean, that would be formidable, and i think that's what people are looking at saying ultimately in a couple of years could we see united technologies split into a couple of companies >> and going back to phil's point at first, helps us explain why boeing is one of the underperformers today with that decline. phil, thank you so much. >> thanks, phil. >> you bet. >> and the dow is down 242 points we're tipping a little bit lower as we head into the close with just under 40 minutes to go. better than 1% declines for all the major averages with the nasdaq down earlier 1.5%, a little more han 1.5% and that's the relative best per former down 21. financials the worth performer on wall street a look at what's behind that move sgloer and chief market

strategist j.jkimen . naback with us to talk about how investors should be weather today's selloff coming up. you always pay

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energy has been the leading indicator with lower interest rates.

we've seen the lower yields today. utilities not far behind and, of course, that's the one that benefits from the lower interest rates. energy and oil is at a three-week high and consumer staples doing well. >> those financials down more than 2% on pace for the worst daily performance since may. the insurers, by the way, having an even worse session. bank of america on pace for its worst day and seeing a decline in the range of 3%. >> travelers one of the biggest decliners and heam depot one of the biggest gainers both for the same reason as we're on hurricane watch yet again. for those financials, you know, especially as holly was pointing out. if we're not going to see inflation numbers, maybe the fed is on hold the barometer for the month, for the season, if you want, comes out in the first day it was incredible and even if the jobs report was fairly stop.

strong and yet the inflation is not there, and -- and, forget, all of that is overshadowed by everything else going on and so, too, there is the impact on the ten-year and across financials today. >> coming up we've been talking with mohamed el-erian. he tells us whether today's selloff is a red flag or whether it's actually a buying opportunity. that's coming up in a bit. >> plus, north korea relies heavily on china for economic help, but there's other surprising countries that help make the rogue nations economy most american homeowners would be shocked

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exactly 30 minutes left in the trading session. gordon charlotte here on the trading floor. you're among those watching the level of the s&p, 2455 we've bounced off of that a couple of times sfwls been an important infliction point for us it's almost been the pivot that traders have been looking at, and i think it's significant that we've ended up here now. >> so are you suggesting, we've heard from other traders already that this could be a buying opportunity here to see the selloff. >> no question about it. i mean, even if you look into the closing imbalance indications, bill, we're looking

to the buy side here, so i don't think people are spooked by what's happened here today i think that some of the risk was taken off and now that that's happened guys are looking to find some value. >> unless you consider that yield are at their lowest level of the year and gold is at its highest level of the year. >> well, that's part of the risk-off trade, bill you know that that's what's going to happen, but there are other things, too, the price of oil is telling you that geopolitical concerns are not out of hand yet. you know, the latest announcement out at d.c., you know, you've got to be always concerned about, you know, debt ceiling and will have they have damage do you think that they will be able to handle that one, too, so i think a lot of the negative press that you're seeing is really something that you can maybe discount to some degree and maybe get in behind this, and that's what the tape is telling you. >> all right see what high pressure system as we head to the close. >> thanks very much. >> have you noticed how far he's standing away? >> you know, very cordial, but

you're scaring him off already thank you both. >> that's more like t.time now for a cnbc news update with sue herera sue. >> hi, kelly hi, everyone here's what's happening at this hour hurrican irma continues to strengthien. it's now sporting winds of up to 185 miles per hour the category 5 storm is heading towards the leeward islands and then towards puerto rico and maybe parts of florida: florida governor rick scott has declared a state of emergency for his entire state pro-daca rallies being held across the country daca is an obama era program that allows undocumented immigrants brought here as children to stay under certain conditions attorney general jeff sessions saying that program will be rescinded. mandatory evacuations are under way in utah where a fast moving wildfire is burning the flames have spread over 40 acres. they have already destroyed three homes. the flames can be seen for miles billowing up from the various canyons there. and brazilian police raiding the

home of the brazilian olympic committee president and issuing him a warrant. authority want to force him to testify in a probe into bribery surrounding the awarding of the 2016 rio games you're up to date. that's the news update this hour bill, kelly, back downtown to you. >> sue, thank you very much. we'll see you next hour. meanwhile, tensions with north korea have sent global markets lower today as we've established the ishares of south korea and etf, getting hit especially hard down bomb 3% let's send it over to michelle caruso-cabrera, more on this and a closer look at those countries who do help north korea's economy. michelle >> we are taking a look at that because president trump tweeted this weekend that the u.s. might cut off all trade with countries doing business with north korea, but which countries are those. ? number one china, along north korea's biggest economic enabler however, as of today china says it will stop importing commodities like iron ore and

seafood from north korea, that north to comply with the latest round of u.n. sanctions. however, china still supplies oil to north korea and allows north korean front companies to operate in china russia has economic ties just one example u.s. investigators found a truck company was operating a plant in north korea and the facility produced these trucks which were supposed to be for civilian use. instead they ended up belonging to the north korean military countries smaller in size economically, malaysia, investigators found it allowed several north korean front companies to operate there giving north korea access to foreign currency and bank accounts, and then there is the continent of africa. several countries there buy weapons from north korea 15 african countries have uses north korea labor for state construction projects and also very large socialist statues it's one thing to say, guys, that you're going to cut off trade with africa and maybe

malaysia it's another thing to say potentially cutting it off with china. nobody in the foreign policy world is taking that threat very seriously. >> the and russia, too, michelle had. i meaning the way that vladimir putin is responding to all of this seems to be say that, well, let's not get too ahead of ourselves here while there have been reports that their oil is now making its way to north korea. >> they are at the u.n. trying to slow down the vote who isses which is what they usually do. a couple of examples that we point to every time they let off one of the ballistic missiles or let off a bomb the -- the debris that falls into the ocean is collected by investigators, and in the past they have found parts that have writing on them that have definitely come from russia as well, not just an economic enabler but physically helping them with the weapons program. >> and all of this points up a base i tentative econ101 that tells us why sanctions don't often work because countries that are being the object of

sanctions often have alternatives i mean, you know, the same thing happened with cuba for years they had other countries that they could trade, even though the united states had that embargo on them for years. >> russia supported them with billions of dollars every year russia has a long history of doing that, whether it's cuba and venezuela right now and now, of course, north korea as well because, of course, they like being a thorn in the side of the united states as long as you have this world where there are two sides divided in such blatant ways, somebody will be able to help out the enemy of the united states. >> we'll see if they pose more hurdles it is a moves through the u.n. and beyond, but even if they impose the sanctions there's ways around it michelle, thanks very much michelle caruso-cabrera back at headquarters. >> 24 minutes left here with the dow holding at the time steady down 231 points and, again, we watch that level of the s&p and traders, they are very big chart watchers 2455 is the number that they are watching very carefully. it's stopped at a couple of times and we're just about that

right now. have tensions with north korea stopped retail investors from getting into the markets when we come back we'll talk to td ameritrade about what their clients are doing right now. >> later, mohamed el-erian talks about the selloff and whethea r deal on tax reform will overshadow the tensions on north korea. stay with us they don't invest in alternatives or municipal strategies. what people really invest in is what they hope to get out of life. but helping them get there means you can't approach investing from just one point of view. because it's only when you collaborate and cross-pollinate many points of view that something wonderful can happen. those people might just get what they want out of life. or they could get even more.

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welcome pack dow sitting lower by 232 pain. one of the sharpest selloffs we've seen this year, of course. 1% declibs are in the range for all the major averages, financials and insurers some of the hardest hit with the move lowe in interest rates and technology not a lot of places to hide today. >> the nasdaq having its best woke of the year last week. >> wow. >> didn't even feel like it. >> and here's a bright spot in the market shares of biotech company skyrocketing after its phase three trial. the company says it is plans to pursue accelerated approval for the therapy known as alice and the stock has nearly doubled in trading today. >> look at, that wow. >> meanwhile, t.d. ameritrade clients, we were net buyers-ins august for the seventh straight month and will they continue to way after today's selloff?

i'll mention it. i'm sure it's come up all day, september, the toughest month for the stock market of the year there i've done it j.j. kinamen with us are you seeing anything today. your clients are trading volatility here. >> some of the volatility products, et cetera, vix, it's interesting because i think our clients are trading at similar to professionals and they weren't necessarily long vix because it just didn't pay for the longest time and even if it moves 20% you're still at a relatively low value of vix and it's interesting how many of our clients have made the adjustment. >> are we going to somehow get the income stream from being short these products >> there just hasn't been -- the volatility of the vix was actually pretty low so it didn't pay to do so one of the things many have done is sell out of the money puts and say i'm going to going g at

9 if someone puts it to me. >> what the clients bought in the month of august, looks pretty similar to what they bought in july the amazon and google. one big change last month, bill, is facebook is one they usually issue. we didn't see our regular clients facebook as well but the millenials, facebook, red fin. >> red fin, funny you say that i can't tell how many people have been talking about red fin, traveling around the last couple of weeks one of the best performing ipos. >> we kind of throw millenials in a big pot. >> yes, we do. >> but there's a big difference. >> and for good reason sometimes. >> but there's a big difference between someone like kelly and someone who is to in college and their biggest concern is a six packs on saturday night. god bless them. >> i can't say that. >> people your age might be looking at homes and very interesting that red fin, it's a

technology difference. it's how younger people will look for homes compared to maybe how their parents or others did. >> i can attest to that, that you are correct in that. >> boy, you've pegged this millenial. >> it's up 4.5% today. they are selling twitter so it's not all the social media platforms. >> not just that, but you've got wells fargo. they sold nike they sold generally motors they sold the aluminum twins and alcoa during the month. >> again it's always interesting and we talk about this when i come on is people are smart and, again, these are poem who interact at least once a month and people who plan their vacation longer than their investments probably don't do as well but people who take time to interact are doing the sectors. the biggest criticism, look at the markets. the clients were net buyers. it's bade to be a buyer for the last five years but particularly

in 2017. the fact that you've had seven consecutive months where they were net buyers, has that happened before? >> this is a record. so it's really going to be interesting to see this month starting the month this way, but, again, in august, think about a lot of stocks, didn't do so well and then the other thing, let's keep in mind, earnings drive the market. earnings have been pretty good you did see at&t in this one, didn't see verizon in fact, the millenials were sellers of verizon so the yield stocks which are normally a large pot. >> millenials were sellers of verizon. >> looked for every reason i can find i can't find a reason why the millenials were sellers of verizon and verizon and at&t, as you know, are usually highly correlated particularly with our

client base and this was a very strange month so i'm very anxious to see what happens next month and see what the bond yields r.seems to make the yield stocks more attractive >> look, there's at&t down 1%. >> right. >> it's a squirrely kind of market that's a technical term. >> thanks, j.j. >> always a pleasure. >> j.j. kinamen from t.d. ameritrade. >> hand 15 minutes to go with the squareliy market it's down overall. down down about 240 pounds we'll see if we retest that into the close. s&p down about 20 points and nasdaq down 66 and russell down 15 and with the nasdaq and tech secretary zor a major culprit. next we'll head live to the platform for a look at the tech wreck. ou and president trump will talk abt tax reform we'll have details from that meeting as soon as it gets under way at the top of the hour

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the dow is down 243 points with about 12 minutes left. >> we mentioned some of the weaker names in the market and check out the cruise line stocks they are getting crushed as hurrican irma chettens the caribbean. carneal down 3% and royal caribbean is down 4% norwegian down 3.5%. talking about the worst decline for these names. >> the market knows all. the market knows all. >> it looks like it's going -- it's perfectly formed, and it's huge. >> it is. >> one of the strongest they have ever seen in that part of atlantic, ever. >> became a cat 5 in record time there it is, and that's the protected bath right now and what it does after that remains to be seen, whether it continues into the gulf or turns and goes north up the east coast to the mid-atlantic states there, but there are also the fears over north korea that have sent the market into a selloff today. bertha coombs is at the nasdaq market site with more on the decline, especially on technology today, bertha. >> seeing technology and also take a look at the fact that

some of the tech sectors have been on quite a run. in fact, chip stocks today, they are down as far as sectorwide for the first time in five straight sessions or ending a five-day winning streak it looks like today qualcomm hitting a new low today. that stock is in bear market territory down about 30% from its most recent high chips are down only about 4% from the recent high apple today also breaking a winning streak and i want to look at amazon that's the stock to watch here amazon, of course, hitting well above 1,000 and really 1,100 a share. last month back in july or just over a month ago now it's 10% below the all-time high and in connection territory. something to be expected with some of the big tech stocks such as amazon that have had such a big run. today we're also seeing media stocks under pressure and viacom getting a downgrade over wells fargo concerned that viacom doesn't have an over-the-top streaming strategy and that's

weighing on the sector and bucking the trend at all-time highs, intuitive surgical, that as the company is looking at asking share holders to split and monster beverage, like a blast from the past, remember when monster beverage was the big momentum spot, it's back in a big way. back to you. >> up half a percent today what about apple, i read they were more than double the dow's entire point gain last month. >> yeah. the interesting thing about apple is that every time everybody says it's gotten too expensive, they don't have something new, then we get thattant lidsing invitation for a september event, the expectations here for an iphone 8. so a lot of folks are seeing apple having a bit more momentum here as i said, apple down just about 1.5% from it all-time highs that we saw last week, down for the first time in seven sessions

we're not seeing a whole lot of volume here on the selloff either not much more than an average daily amount of volume. >> we find all kind of reasons to poo-poo the iphone 1 until we get the invitation and then captain help ourselves thanks, bertha see you later. we're coming back with the closing countdown. art cashin will join us for that after that. >> and after the bell mohamed el-erian will tell us whether investors think this selloff is a sign othgso me ayitusf in tco this is a story about mail and packages.

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we've got about five minutes left in the trading session, a meat and potatoes day. that is just a day where the focus is definitely on the markets and what the message is from those markets let's show you the s&p today, and as we were talking about gordon and others, 2455 has been a number they have watched today very carefully it's bounced off of that a couple of times. we're above it again right now as the dow and the s&p both challenge their 50-day moving averages throughout the day, so we'll watch that one very carefully. the ten-year yield at its lowest level of the year for the first time this year, pleau 2.1%, hit

207 for a time it's right around that number right now, and as part of this safety trade, the price of gold hit its highest level of the year, it's up another $15, $16 right now at $1,346. oil at a three-week high they are reopening some of those refineries now in the wake of harvey, and that will increase demand for oil and you'll see more volatility in oil as irma becomes more of a threat, especially if it does not turn north after sunday and continues into the gulf where all of those oil platforms are. finally we show you the vix today. it's now at 12 it was in the 13 range earlier, but it has come back just a little bit here and no surprise there. a big move for the volatility index. seema mody is with us and with us is mr. cashin to finish this day off to tie it up into a bow. what do you make of this selloff

here >> 80% concerns about korea. no one thinks that anybody is crazy enough to press the button consciously, and financials are badly hurt and conversation that irma may hit the florida keys and maybe even miami but the early look at jose is that it may hit new york city, so that's enough to get everybody worried. >> i was saying earlier that travelers is the biggest -- one of the biggest decliners in the dow and home depot one of the biggest gainers and both for the same reason. north korea to art's point the move in defense stocks that's really sending a strong message to investors with the heightened geopolitical environment there's an expectation that we'll see more military equipment and defense being deployed in asia, specifically around the korean peninsula. seen names like raytheon

among others like lockheed martin, that's one rally that continues. of course, the other part of the story is cruise liners as we watch the impact of hurricane harvey but also the upcoming hurrican irma. >> and i mentioned gold, the highest level of the year and yields on the ten-year and lowest level of the year so very much a safety trade. we've been waiting for this for a while, but now it's finally evidenced itself here, right >> it's a full safe haven play, and you'll get a good look tomorrow if they continue then you know the worries are higher than they appear. >> one part of story is the ten-year note. is it the north korean risk or does more of it have to do with the upcoming ecb meeting or that monetary policy is sending the yieldlower >> after the move, north korea and the safe haven plays, but i think you're dead right. you had lionel brainard come out and say we don't need to worry about inflation.

i don't think they hike in december. >> if the dollar continues lower there, you might have a different story to tell but whatever remains to be seen. are you among those watching the level at 2455? >> yes, the originals i told seema earlier in the day was 2461 to 63, and it broke that, and it dropped right down to the 2455 and it's hanging in there we'll take another look tomorrow. >> and the dow is trading below the $50 day moving averages. gold a big part of the story is it overbought and now up 16%, 10% over the past two. >> looks like it might be breaking out so i'm going to reserve judgment on that, too. >> as always, we'll watch and see what happens overnight in the international markets because this has been a global selloff since the fire of that bomb by north korea over the weekend. >> absolutely, and on the verge of another missile. >> all right we'll keep an eye on that. thank you both very much see you later. we're going out with the biggest declines since august 17th the dow down more than 1% or 230

points, and the yield and the ten-year at its lowest level as the safety trade continues much more coming your way. the president talks tax reform with some of the top congressional leaders come up on the second hour of "closing bell" with kelly evans and company. see you tomorrow, kell >> thank you, bill, and welcome to "closing bell," everybody i'm kelly evans. it's a tough session on wall street, the dowdropping 232 points on concerns over north korea and a whole lot more the s&p is shedding about 18 points today, the nasdaq dropping just about 1% and so did the russell 2000 and how about the volatility gauge and the worst day for stocks as you can see since august 17th. we have worries about north korea after a major missile launch there this weekend.

and administrative concerns as well in washington how will all of this affect the agenda actually president trump is meeting with congressional leadership and members of his cabinet at the white house to discuss tax reform stocks having its worst day since august mohamed el-erian joins us on whether he thinks there's more pain ahead and what he thinks is going on in the markets. we look forward to that shortly. joining us is mike santoli and danny hughes and welcome to everybody. mike, first to you, you point out there's odd bedfellows. >> energy was strong, just bouncing, not big enough as part of the index to just drive things on the other hand, it was orderly and even though it was a big down day, the biggest in three weeks, s&p back down to

the biggest levels seen since wednesday. it was a global kind of risk reduction move when the japanese yen rallies and treasury yields fall back below the bottom end of their range, it does show you that people are clenching up. there's more reasons to take risk off and put it on as we head into september for all the policy reasons that you mentioned and others. >> the last couple of weeks when the north korea situation was already getting worse, markets seemed to take it in stride. is it because of the magnitude and the scope that there may be more launches ahead. why do you think the outsized reaction, given the size. >> when the vix is at 12, it's up two points. still at very, very low levels from a historic basis. i think it's unusual how little volatility we've had through all of this. i'm surprised there hasn't been a 2%, 3% down day. >> no doubt. we talked about that, but why today did it come home to roost?

that's because people think it might be now a situation where they are launching larger missiles and okay, seeing this and that and now the size of the earthquake over the weekend, the fact that this is ten times as powerful as it was dropped on hiroshima and they have these capabilities already and they are talking about doing more nobody seems to have any idea what to do about it. >> it's difficult to try to figure out what the implications for the economy is on those kinds of things, not to belittle the threat of nuclear war but a second major category 5 potentially smashing into a major urban area in miami. that could be another $50 billion that has big implications when you have two major storms like that it will affect gdp. >> and it's a legitimate question to look at the insurance industry which got hit because look at the interest rates, the ten-year benchmark rate down 2% and what mark is talking about. now a huge hurricane that could be a double whammy the industry sells plenty of

capital but back-to-back storms like this it could take a really big mitt. >> that's a big piece of what's worrying this market finally we've had a lot of worries for a long period of time but i think the back-to-back storms, how that's going to affect the economy in southeastern america and, you know, the biggest concern for me and for investors looking at the markets globally has been the threat of north korea which just seems to get worse day after day. and the worries have been monumental and adding up more and more and the concern is how do we turn out even better from this second quarter gdp came in as were you alluding, to better than expected and, yes, the economy is on track and the worry that the market has is something that has been dominating for a long period of time and only down a little over 1% today this market could certainly pull back at least more than 10% which really is about 2,000 points which takes us below, you know, 20,000 on the dow, let's

just say, and i think that that's the kind of selloff that -- that we have been waiting for for a long time that's not here yet. >> michael, what's interesting about it if you were to say let's just focus on the fundamentals of the market itself, you have an incredible read on u.s. manufacturing activity to kick off the month. the underlying numbers, all that, the weak dollar is going to be a boon here, all of that is in place. >> i think the market comes to work every day and says what in my multi-day outlook is going to get better or worse than i thought it was when i was last at work, and i think that's really what it comes down, to and when you're not going to see resolution of what the path of the storm, is any of the policy stuff is, immigration is becoming this huge loud issue ahead of whatever else congress is supposed to do. i think all of that is why it becomes very noisy, but let me just say world markets were open yesterday. u.s. markets were not. north korea happened over the weekend and i don't think that today's u.s. move down 1% was

about north korea. >> i was going to ask you that are we playing catchup >> the world was kind of like shrugging to some degree it's kind of like the pile-up of issues more to the negative side and positive, not so much one big scary thing. >> the d.r.e.a.m.ers' protection will expire in march unless you do something about it and q1 is the most likely or most optimistic maybe for tax reform so we'll what the president is saying when he meet with people shortly but does it darken the prospects for you? >> without casting any moral judgment on the whole issue of immigration. it's a shame when you look into the cold hard facts of the stock market you're looking at a debt ceiling and a budget and looking at tax reform you -- and an immigration issue is a politicized bickering argument that will suck all of the air out of the rom and it puts all these things on the back burner or delays them,

that's going to hurt the mark. >> dani, real quickly as well, it's not north korea as a risk per se it's that the u.s.-china trade could get hit as a result. is that something that could be on horizon >> it's the global aspect of what could happen as a result of something getting even worse than it was right now in terms of the huffing and puffing politically, but to your point a little bit earlier, everything is becoming politicized and really that's just what we've been focusing on in this market instead of cold hard earnings which, you know, the market continues to expand and the economy continues to expand. we're just a little over our skis right now. >> let's bring yewy in here for a moment as concerns for the ability of getting tax reform done is weighing on the market the president is meeting with key members of coming and his administration to discuss that ilean, you kn -- ylan, the path getting more steep.

>> >> reporter: this is an opportunity for the white house and gop leadership to touch gloves and reconnect now that everybody is back in washington, and ahead of of this meeting senate majority leader mitch mcconnell outlined his priorities for his agenda in september, and they are disaster relief, the debt ceiling and funding the government as for tax reform, he says that the committees will continue working on that issue. president trump is stepping up his campaign for tax reform and headed out to north korea tomorrow and over the weekend he published an op-ed in the "milwaukee journal sentinal calling on congress to deliver him a plan that's pro-growth, pro-jobs and pro-american and all of these things take time and that's why morgan stanley put out a note this morning saying its expectations for tax reform have been moved back into 2018 and that was before the daca program got added to congress' already busy legislative agenda that's why you're seeing

companies like microsoft say that that program and that issue, daca, should be priority number one even if it means that tax reform takes a back seat guys. >> ylan, thanks very much. more from the white house shortly. meantime, we have earnings from hewlett-packard enterprise i think just hpe is what i'm calling interest deirdre bosa has those numbers. >> reporter: i'll call it hpe as well, kelly and mike a beat on the top and bottom lines, the enterprise segments of the old ph, revenue coming in at $8.1 billion versus 1.5 that's better than expected though it's down more than 30% from a year ago, reflecting partly the spinoff of its enterprise services business eps above the 26 cents forecast. guidance for the first quarter, 26 to 30 cents which would be well below estimates, but it's unclear whether the new guidance is comparable to the street consensus. we will look into this take a look at the stock it's up nearly 2%.

hpe shares have been underperforming the s&p year-to-date and on a 12-month basis. we'll be keeping an year out for cost kusts, number and colors around server sales and meg whitman's commitment to the company after she was vying for the role of uber ceo guys >> deirdre, thank you. we look forward to hp ceo meg whitman joining cnbc to discuss these results and that issue tomorrow in a "squawk on the street" exclusive beginning at 9:00 a.m. eastern. mike, shares up a little mohr than 2%. >> yeah. certainly on the top line beat it looks pretty significant. the stock has been very sleepy been a sideways stock and really considered to be not really a growth business anymore, but if they can manage it well and kind of squeeze out a little more in terms of that upside tilt to guide arranges i guess that's hock. >> mark this, wouldn't be one of your dividend picks. >> not hpe until a similar vain, this is a stock that bores everyone to death, too, cisco.

3.7% dividend yield. not a great looking outlook right now. 22% of the market cap in cash and they have raised the dividend 38% in less than 14 months. >> so you think that's pretty exciting >> i think it's a company in transition i think if you have patience, 12 to 18 months you'll make money hope flip it's the microsoft, oracle kind of transition from the old world into the new world. not positive, ugetting paid pretty nicely to wait. >> if you're specializing in the dividend areas, do you say i don't mean the selloff, i just mean the interest rates going lower and lower and think this is amazing >> yes. >> when you look at at&t. >> the whole trade was supposed to be long over and done with. >> absolutely right. having difficulty finding it in the banks because the yield curve has flattened so much. hard for them to make a lot of money. elsewhere look at at&t 5.2% dividend jacobs fieyield, k the fcc loosening regulations, it's almost 2.5 times the tenure

and the stock sells at 13 times earnings looks pretty good to me. you're right i think there's a lot of opportunities when you look at the ten-year treasury yield and dividend-paying stocks right now. that's what we're trying to do. >> from the broad market perspective, the s&p 500 market is equal to the ten-year treasury yield, around 2%. >> give or take. there's nothing magic about that relationship, but any time they have crossed and the dividend yield goes above it, it's been a pretty decent risk/reward. >> when you consider amazon doesn't pay a dividend. >> if you look at the dividend yield only of s&p stocks that pay a dividend, it's well above. >> way above. >> lots of opportunities out thereto. >> as we look at the selloff today, what are the opportunities that you see right now? >> tremendous amount of opportunities in travel stocks i would even say in insurers, you know, despite what's going to happen. those insurers for the most part will be in business, some of them paying very nice dividends as well so there's picking you

can do what's happening now and they will always be that way, kelly. no matter what the markets do, there's always going to be opportunities to make money in the markets despite what's happening at the top line level where the s&p is going higher or lower. there's lots of places to find value. >> michael, just finally, circling back. the only major earnings this afternoon were the ones we just talked about, hpe, so we're taking a leave from what exactly? does this come down from the thing we might hear from the white house shortly about the prognosis? >> there was a headline also, the congressman saying they are going to attach harvey relief to the debt ceiling and the fact that the market found its footing, i think one of the big issues with this morning's trade was that we had this very light volume, levitation towards the old highs on nobody being at trading desks last week, and you had to test it to see if it was for real you know, we'll see. i don't know if you can predict

exactly what the cat lifts will be tomorrow. >> we won't try but hard to put all these things in context. >> mark spellman from alpine fines and dani hughes from devine asset management. trump is holding that meeting with key members of congress to discuss tax reform we'll bring you the comments from the white house as soon as they are out but more first on today's big market selloff we get a read from mohamed el-erian and you can contact the show via twitter or e-mail us. you're watching cnbc, first in business worldwide your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered...

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welcome back the dow shedding more than 200 points today on worries of north korea and delays in tax reform and joining us to parse through all this move is mohamed el-erian welcome. >> thank you >> do you agree with what we were talking about a moment ago? look, obviously the major concerns about north korea are a part of what we're selling off today but there's a lot else going. what do you think is contributing to today's downward

spiral >> so i agree we have to keep it in perspective it's not surprising that we sold off over the long weekend. we had yet another brazen act by north korea. we had a reminder that the u.s. is looking at all options and it could drag in other countries that trade with north korea and then put on top of that wealth-destroying hurricanes and put on top of that uncertainties about the debt ceilings and uncertainties about tax reform to me it's not a surprise that we got the selloff the question is do we get a bounce back that they bide on dip mentality. >> what's the main concern there about how that would play out and damage activity? >> the main concern is that this would damage global growth at a time when global growth is picking up in asia, in europe, so you don't want to damage the underlying fundamentals because you need improving fundamentals

to validate asset prices so anything that damages the fundamentals would be a major concern. >> meanwhile, mohammed, we have plenty of central bank talk coming in the coming weeks we heard a couple of dovish voices out of the fed. the market seems to be repricing any chance of the fed tightening path picking up again well into next year so where does that leave markets. >> i think what the market is listening to very carefully is the dovish talk on two things. one, on low flakes, that inflation is too low we heard it again today from governor brainard of the fed and, two, that the ecb is delaying the announcement of the details of its taper program that is what the market has focused on what the market hasn't listened to is the concern about financial stability that is alive and getting louder within the central bank community bottom line, it is repricing way

too far out the next fed hike. >> okay. so i'm glad you raised this because a moment ago we were talking begun whether those hikes might be pushed off, so let me ask you something, mohammed what about the fundamentals have changed at all asking about the global trade, that seems a little bit on the margin otherwise you have europe strong and pmi readings at multi-year highs. u.s. strong, same stories. those don't sound like reasons to delay major tightening moves by global central banks, right >> absolutely. i think that if the market were to look at the global economy as a whole, it would not be pushing back the rate hike what it is concerned about is all this talk about low flakes we can have a very long discussion of how much is structural and on the economic side it's balanced and what will tip the hand in the earlier hikes that the market has priced in and is concerned about financial stability.

>> mike, i want no know what you think about this as well if we've gotten to that point now where it's, okay, asset prices are looking too toppy and on a day like this, doesn't seem like the biggest concern, maybe bond prices and they start to think should the ten-year be at 2% how do you think that traders are kind of reacting to all of of this? >> traders i think are -- have this premise, look, weak dollar is -- is a high liquidity indicator. weak dollar is lose financial conditions all half is in the backdrop. i think mohammed is correct. i don't think it's focused on the prospect that central banks will knock markets back on their heels saying things have gotten too frothy that serves as a potential excuse for central bankers to change their tone a little bit because if the inflation thing, it's a matter of whether you want to pay attention to your target or not and if they feel you need another premise, that could be financial stability. >> maybe i could put it this way and it's not where they are coming from but it's the same

end result look, inflation never got to our objective, if you will, but we think that some assets prices are too high so we're going to raise anyway. >> we think financial conditions are too loose and mike is absolutely right inciting the dollar we think it's too loose and we have a window and we're doing this because we worry about the potential for future instability. you won't hear this. you will not hear this on thursday i suspect the ecb will not disrupt markets, but you'll hare it in the weeks that follow that. >> mohammed, thanks for your insight as always. >> thank you >> mom el-erian, up next we'll take a look at other market stress and the cleanup from hurricane harvey continues and ora.ican irma takes aim at a live report from the texas coast coming up.

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>> house speaker paul ryan and the two leaders of our tax-writing committees, chairman orrin hatch and chairman kevin brady, who have been working on tax reform for months with our sent of the treasury, steven mnuchin and gary cohn, our national security council director since the day i took office we've added 1.2 million private sector jobs and a lot more than that if you go from the time we actually got elected november 1th, including 125,000 manufacturing jobs, and we just had another good month for manufacturing and the jobs, you probably all saw that, but if we're going to keep this momentum going and allow the economy to truly take off, as it should, it is vital that we reduce the crushing tax burden

on our economies and our on workers. we paid highest tax of any country in the world on businesses, and we can't keep doing that last week i repeated my principles for tax reform. first we must make the tax code as simple as possible. it's extremely complex it's not fair, and it's extremely hard to understand, so we want to make it as simple as possibility. second, we most provide tax relief for middle class workers and families third, we must restore our competitive edge which we've lost we're doing fine and lost the competitive edge you see what's going on all over the world so we can have real job growth throughout america. we can't be the jobs magnet of the world if we continue to tax our industries at rates 60% higher than companies in other

countries, can't do it, and finally we must bring back trillions of dollars that are currently parked overseas. we have, in my opinion, $4 trillion $4 trillion. massive amounts of money that can't come back to our country because of our tax code and because of the rates and -- and this is more than just tax reform. this is tax cutting to put it in a very simple term we're going to cut taxes we're going to reduce taxes for people, for individuals, for middle income families well ear going to reduce taxes for companies, and those companies also going to produce jobs tax reform that follows these principles will create millions of new jobs and ensure that more products are stamped with the very beautiful letters and words made in the usa. it's time to lower our taxes, bring back our wealth and make america the jobs magnet that are it can become and pretty quickly. it's an expression

i don't know if too many of you have herd it, it's time to make america great again. has anybody heard that expression i don't think so, so that's what we're doing. we're making america great again. you see it in numbers and you see it with jobs and you see it with companies moving back in. they are moving back in at very, very big numbers they are coming back into our country, and you haven't seen that for a long time, so we're very proud of that so we're now going to discuss tax reform and tax cut and i appreciate you being here. thank you very much. >> mr. president, how is the daca -- >> i have a great heart for the folks we're talking about and great love and people think in terms of children, but they will really young adults. i have a love for these people and hopefully now congress will be able to help them and do it properly and i can tell you, in speaking to members of congress they want

to do is right we have no choice. we have to do something and i think it will work out very well and long term it will be the right solution >> thank you very much, everybody. thank you. >> president trump meeting with top congressional leaders and members of his cabinet on tax reform let's bring in ylan mui with a little more. some of the headlines, bringing back and repatriate the trillions from overseas, but how much of of this depends on meetings like this how much of this is happening with groups behind closed doors and how much progress is being made right now. >> these types of relationships will be critical tone sharing tax reform, if and when it does happen actually gets passed. back in 1986 treasury secretary james bake worry personally call republican lawmakers to try to get them on board behind this effort, so you might see treasury secretary steven mnuchin having to replay that part of history as this moves

forward, but you also heard that that the president and big six are still talking in very broad brush stokes about simplifying the tax code and bringing money back it's important to highlight one number that the president threw out there. 4 trillion is how much it could be repatriated and the last estimate was there's only about 2.6 trillion sitting overseas. that could be really important when you look at how much money there could being to pay for lower rates and what the economic impact of bringing some of that money back might be. >> the details of everything in this kind of tax reform effort thank you now. again, the president meeting with top comingal meetings with cabinet. sometimes posted their one-day drop and maybe in part over concerns whether that will all get done a look at some of the market stress points. >> those include many of the concerns out of washington, d.c.

like you were just talk about, and they are manifesting themselves many different places in the market. if you look at gold prices, it's something that we've been highlighting now for quite some time with regard to geopolitical concerns you can see gold prices up another percent. highest level that we've seen for some of the market prices and as we watch what happens with gold and that's going to be a big one. dollar/yen, risk in the marketplace and as you start to see the value of yen rise, dollars fall and as you can see here we've been on a downtrend over the past year in terms of dollar/yen, dollar losing strength versus the japanese yen. ten-year yields, highlighting it, 2.70%, some. lost leaves that we've seen this year 2.07% maybe means there is a concern about inflation or growth going forward those are all the stress points. however, if you look at the way the markets have played out so far today, yes, it was a bad down day and we did finish off the lows of the session. two places that you want to watch in terms of whether or not

we see a broader-based selloff or more stress in the marketplace, haven't seen it yet. looking at, first of all, high-yield corporate bond, the corporate bond etf has held pretty steppy and then check out corporate investment grade bonds. this etf ticker tracks that. actually up half a percent today so as we look for broader issues of stress in the marketplace, those credit markets and bond markets are going to be places to watch, not just treasuries, something certainly, guys, to keep in mind back over to you. >> for sure, but, mike, i was going to say, based on what mohamed el-erian just told us, markets are going to sell off and what indicators are involved and he's talking about, no, no, no, from the fed's point of view everything overheated and they will raise rates and if that's the case does that is mean the ten-year yields start to jack back up or does it mean that

they are too tight >> we're not at the strongest levels in terms of financial conditions so, you know, if the fed was going to be concerned that junk bond markets are way too frothy it seemingly would have happened. high yield has softened up a little bit dom mentioned it's only a small decline in the junk bond etf, but treasury bonds were rallying all day so that does represent a weakness of high yield speculative debt relative to treasuries, so i think implicit in your question, kelly, is that it's a very small margin of difference between, geez, markets are nervous and markets are way too gidy >> don't you agree, dom? we've hardly seen a selloff big enough to see whether the markets are too hot right now. >> and you're right. you guys have been hitting on this idea that, remember, the markets -- there's a fine line between panic and -- and seemingly better markets at this point. we're going to find out a lot over the next couple of days

because the m.o. for the markets has been every time that we've seen a 1% to 2% bull pac, the last time we saw prior to this past nuclear test from north korea, we did see that intermediate missile flight over j.p. and the markets pull back .75 of 2% hand that's held true pretty much over the course of the past year any time we've seen a real bit of stress in the marked place or perceived stress, the market has seemingly found the bottom here so as we watch the trading tomorrow and the next day it will be interesting to see if the market buys the dip. >> absolutely, dom, thanks very much >> time now for a cnbc news update let's flip it over to sue herera. >> here's what's happening at this hour. u.n. ambassador to the u.n. nikki haley says the u.s. will not necessarily withdraw from the iran nuke deal if president trump says iran is not in complies

the deal is flawed and iran has violated it multiple times. >> i'm going to pre-judge in many ways what the president will decide. while i have discussed it with him i don't know what decision he'll make it is his decision to make and his alone. >> a spokesperson for china's foreign ministry called on all sides to de-escalate the tensions on the korean pens latch the comments come as south korea expands its military arlesial with more powerful missiles to deal with the north korean increasing manulife threat. the ice bucket challenge was honored with a day half him. a rally was held for pete frates whose challenge has raised a.l.s., lou gehrig's disease. >> that was such a brilliant idea nothing has ever been like it since. >> absolutely t.resulted in some

very good research, so fingers crossed. >> exactly. >> sue, thank you very much. >> you got it. >> our sue herera. more after-effects from hurricane harvey property and casualty insurance companies taking a big hit in today's selloff. take a look at some of the declines with all state and travelers down nearly 4% we'll go live to houston where adjustors are at work to begin the claims process and we'll talk to a claims adjustor to talk about hurrican irma's financial impact as it approaches stay with us not reacting to market downturns. focused on what you love, not how your money will last through retirement. let us help you with those decisions, and get on with your life. we make it easier to plan for retirement with day one target date funds from prudential. look forward to your 401k plan. marcopolo! marco...! polo! marco...! polo! marco...!

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welcome back insurance stocks were having their worst david year the index itself down 2% and some of the names were down nearly 4%. hurrican irma is now on track to hit florida next week and recovery is under way in houston mean time. insurance adjustors are heading to texas to assess all the damage morgan brennan is on the ground with a look at potential auto losses which could be major. morgan >> hey, kelly, that's right. with an estimated half a million vehicles or more expected to be damaged by hurricane harvey, the auto insurance losses are coming or auto insurance claims are coming in and with them car buyers so take corrine hill, in a clear lake infiniti dealership

earlier today. >> i was on the way home for work and got off the beltway 8 and i just came up on to high water so it -- it literally completely submerged the car >> so she quite literally had to claim out of her sun roof to escape that car. it was a brand new infiniti. it had just been purchased back in february. as she's waiting for the insurance money from geico which is owned by beth away to come through she was in this dealership today shopping for a new up same make and model though she did note the price seemed to be a little bit higher. as far as she knows her damaged car still sitting on the highway because the exit is closed but as we've seen firsthand it's almost certainly destined for a salvage yard, a salvage yard on the outskirts of houston which took over a racetrack which has been accepting thousands of cars from insurancers over the past few days but that's just the totalled cars.

for the cars that are possibly salvageable, they are coming to this dealership, hand by the way, the dealerships are also dealing with their own losses. this one suffered $8 million in inventory losses when it flooded, too, last week. back over to you. >> oh, my goodness looking at that photo, it's amazing they can even do the work now morgan, thank you. hurrican irma then is now the strongest storm ever recorded in the atlantic it's bearing down on florida, and insurance stocks are taking a hit as i mentioned as a result you can see some of the florida insurers there with double digit and 20% declines let's bring in paul newsome here an insurance adjustor. i don't know if you cover those companies in regional but those are huge drops. >> we cover a couple of them you're right, very large drops, somewhat expected given the potential for hurrican irma. >> is it because those companies don't have as much capital as major runs that are able to absorb the losses?

>> that's exactly right as well as the concentration of risk a lot of these companies are essentially specialists in florida and a majority of their premium can often come from just florida and that's a lot of concentration of risk where a big company like an all-star, for example, will have a much, much more diversified business. >> how big is the loss number, insured loss number for hurricane harvey >> that's a great question we actually don't know i think it's probably around 15 billion from insured losses, but because of the nature of hurricane harvey, the extent of the flooding and the length of the storm itself, i think it's quite a volatile estimate at the moment and i think we actually just don't know yet. it will take a while. >> no, that's fair, but 15 billion insured losseses is not a huge number. certainly something that the larger players can swallow we also know that was a very sort of flood-specific, water

specific issue where a lot of homeowners was picked up by the national government and when it comes to irma, which is a huge strong powerful wind hurricane, what kind of exposures are we talking about to see the likes of travelers and all state down nearly 4% today? >> well, you know, it's even more uncertain obviously it hasn't struck yet we don't really know where it's going to strike, but it can be anything between zero if it doesn't strike parts of the u.s. to, i mean, the numbers keep going up, well north of what we've already seen if it strikes the wrong place in some place like florida. >> paul, before we have to go. let me ask you ironically because of all of this being the case are these losses let's just say that irma does, you know, tens of billions of dollars worth of damage, does that push the industry into a harder situation where they can raise prices how much are they exposed, even if they have terrible back tore

back storms. >> it real depends on the quality of where it hit, what it hits and how it hits if it's an usual event, not in people's underwriting models then it will have an impact on pricing you'll see potentially higher prices if it changes how underwrite is done if it doesn't it, k have a minor impact on price. really depends on what happens. >> so much uncertainty paul, we appreciate you joining us to sketch it out a little bit, i should say. thank you so much. >> my pleasure >> the that's paul newsome bitcoin hitting a new high over the weekend and falling after china announced a ban on crypto currency crowdfunding effort still a look at it now up 2%. and attorney general jeff sessions announcing the trump administration's plan to end the ata.e.a.m.ers act, dac wh it could mean for the stock market and the job economy straight ahead

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most rogue securities markets china is going to ban icos, u.s., canada, hong kong, can't be far behind. >> i think they already spoke. the s.e.c. said if this is a security, we already have a rule, that deal with security. to me it's not necessarily surprising you know, china, the pattern that china usually does is they ban something first, and then they slowly start to get, you know, loosen up the rules a little bit and get their arms around it, but, no, i don't think icos will be banned in other countries. frankly it would shock me after what the s.e.c. has already said for them to come out and do a blanket ban? >> michael >> i guess i wonder what it says, brian, that the market is so sensitive to the possibility that these, you know, highly kind of speculative reward point auctions, which is what i think we're talking about here, the icos are buy something of value and maybe later in product form. what does it say that the market is so sensitive to these things

and the regulatory groulgs wlin various government >> i'm not sure i would read too much in it but there are rules of offering currencies and when it's a cryptocurrency or stock or bond and if you issue a currency that does not follow the law it should be banned and go to jail in the short term it's pain and in the long run, listen, there are bald actors in every market. there are bad actors in this market i for one welcome this h.let them clean it up get anybody out of it that's doing things illegal i think that's the best thing. >> brian, paris hilton is backing is it liddion? what's the deal with this coin >> there's not a shot that i would buy that coin whatsoever these are the things that you see when things are frothy there's no question there's froth in the ico market.

>> how do you know it's froth? >> the people involved in it are not let's say the most savory so to me that's a no touch when someone has had a background -- >> well, you knew that how is the typical person supposed to know that or is that why they have to talk to you to know that or is that why they talk to you. >> there's a thing called google. it's fantastic. you can find out all this stuff out there. >> can't trust everything you read on google. >> you can't, that's true. the point is that investors without question have to do their research on that. this is not just free money. this is as serious as any other type of investing out there. if you don't do your research, you're going get burned. >> i know. trying to make that point with you there. thank you for joining us. >> my pleasure. trump administration ending a program that brought in immigrants illegal as children. despite opposition from business leaders and lawmakers. impact of that decision coming

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welcome back. if united states rescinding its deferred action for childhood arrivals or daca program. business leaders coming out to defend the dreamers. mark zuckerberg, microsoft president brad smith saying in a company blog in part, the administration has given congress six months to replace daca with new legislation. this means congress should adopt legislation on daca before it tries to adopt a tax reform bill. joining us, with the economic impact of this decision, we're so glad to have you with us. maybe it would surprise people you would support the president, but you actually think this could be deaf devastating.

that's right. a study we did looked at the economic and federal government cost of repeali ining daca and estimated the cost to the federal government alone would be about $60 billion over the next ten years and overall economic impact would be a little over $200 billion. the main thing that happens if you repeal daca is that all these workers most of whom are in their 20s and hitting peak earning years would end up not finishing college and taking jobs in the underground economy earning much less and probably not paying taxes at all. >> that certainly accounts for the loss of revenue to the fram government. i wonder if you were able to gaunt if i it all, the cost on business. especially a time when a lot of businesses are saying they're having a hard time filling open positions and things like that. >> so it's a difficult thing to capture. one of the things that we did point out in the study is if

your main goal is immigration with timing immigration make sure you don't hurt the more vulnerable people. what you're doing is taking the people who are more likely to create jobs and work jobs and occupations that maybe are having problems filling positions and you're pushing them in the illegal underground economy where they're going to be competing against unskilled workers. the other thing is it's really unrealistic to assume the federal government has the capability or would spend the amount of resources it would take to deport most of these people. >> it was interesting you framed this as the repeal of this act as basically costing the government the same amount as hurricane harvey. just again, topical issue right now. so let me ask you this, what are the options, the president in a way has said to congress, fine, this is your issue, you deal with it. you've been given a lee time on this. even the republicans that disagree say fine, take this through the legislative process

and go where you want to go. what would be the light outcome from your point of view. >> >> so one thing they might want to try instead of saying we're not going to do tax reform until this is accomplished is to ask the office to replicate the study we did and come up with their own estimate nor the fiscal impact. if they got somewhere where we did, $60 billion over ten years, use that to pay off some of your tax cuts that would be in the tax reform. it might be worth looking and seeing. >> do you think this -- this doesn't strike me as a budget issue. don't you think it's much more of a campaign sort of platform type issue do you think they're going to make this on a dollar to dollar basis. >> everything is done in politics. what worries me is a lot of republicans and democrats want to get this done. my worry is each side will see this as a campaign issue and refuse to do a bipartisan bill and let this thing die.

>> that's a good point. hyper partisan environment. thank you for joining us. >> my pleasure. parting word of wisdom >> i wonder if this is going to be an abutting issue or one more node of saying big business and the administration are at odds over certain things. that does it for closing bell. fast money starts right now. fast money starts right now. nasdaq market looking new york city's time square. tonight on fast, sea of red for the market today. something in the charts that could spell more trouble for one hot sector. plus the destruction from hurricane harvey is not over yet. now u.s. is bracing for what could be an even bigger storm. irma. bring you the details and stocks moving off of it. later wells farg