optimistic than i've seen him in many, many moons so, yeah, positive on that >> i'll end it just quickly. can confirm that america is a shining city on a hill i just whether you can confirm that for me because i've always accepted that as fact but now some people are doubting that. it is, right >> america is a shining city on the hill this is the greatest democracy and free market economy in the history of history, joe. >> the hairs on my neck are standing up. >> believe me, it is only getting better >> i've got a chris matthews thrill from that thanks, larry. that does it for us today. we go from kudlow to cramer. right now it is time for "squawk on the street. ♪ good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer at the new york stock

exchange chuck robbins joins us shortly u.s.-china trade talks may resume this month. walmart posted the best comps in six months econdata is mixed this morning a couple of big movers, walmart beats and raises, popping premarket. the s.e.c. subpoenas tesla and cramer's interview with senator elizabeth warren you'll hear her plan for new representation at corporations first up, walmart though poised to erase year-to-date losses after posting upbeat results and guidance, e-com up 40%. they raised their guide on eps, on comps, on margin. >> 100 million people shop there. and it is america. those who have been following what they've been doing realize this is the fruits of doug

mcmilllon's labor. he's said he had to change the culture. this is what happens it trades to 100 because people are giving it a 20 multiple. why? because it's got some of the best growth of any company, large or small it's not just walmart. sam's club plus 5 strongest in six years we know that strongest in ten years is part macro. you can't have people not spend on cars and not spend on homes and expect they're not going to shop at walmart. those who go from big followers to walmart and go there, the stores look fabulous they do. >> they do look very good. people may wonder why the split in price action between what walmart's doing today and what macy's did yesterday courtney reagan points out, walmart's up 5, macy's was up 36 >> let's please -- the stock was

up 42% going in. up 45% when you look at pre-market trading there were some people worried about gross margins but they're going to be up year over year. people say the sales are slowing or comparisons are hard. those are people who look at the stock and say i have to come up with a reason to say it is done. it is a longer-term investment not a short-term trade >> grocery comps, best in nine years. in-store pick-up and delivery expansion continues. they say this will be the best gap up on earnings since '01 >> holy cow. i got to hand it to doug mcmillon last month there's fremplnch's mustard for $1.49. that's like a $4 product they always had these products that they sold for less than they paid for them they're underneath their own

price and it puts you into the stores that's the walmart i love. they pay people warn elizabeth warren, segue. you don't have the same turnover you used to. it is remarkable when you speak to store managers, they understand exactly what is happening, whether louisiana, pennsylvania, new york, california this company is rejuvenated. congratulations to them. "journal" today looks at manufacturing and retail growth this summer. this week home depot, macy's stock action notwithstanding walmart today. restaurant spending, at least as records go back. >> i want to emphasize again, people aren't spending on their homes. there's not a lot of turnover. cfo of home depot talked about homes aren't trading

people are fixing up their house not just on groceries but on experience this walmart number solidifies everything that larry kudlow was talking about. the consumer is incredibly strong by the way, the debt numbers from the st. louis fed consumer has the best balance sheet in years these are stories that are not talked about because they are predominantly upbeat i'm going there. i'm willing to be a pollyanna when it comes to retail because i have not seen walmart this good this is the age of walmart, david faber. david. david. >> always on the week he's out >> he's not there -- there's david! this was a remarkable quarter. when you go back and forth, do you know how humble they are maybe it is just that arkansas thing. i mean that positively, razor backs. they're just doing what they said they're not pounding their chest like jcpenney did. >> we'll get to that much different story what happened to the argument that amazon's taking their

lurch? >> this is the quarter when amazon didn't take anybody's lunch, whether it be cvs, best buy, roku. amazon is out to destroy everyone but it is hard to destroy everyone at once we're seeing bouncebacks all over the place from companies and it is because they do omni channel, because they do digital, because they hire people like chuck robbins at cisco, they figure out to do vm ware to get on the web people are going to azure because they're not subsidizing amazon anymore >> stitch fix. etsy >> she's doing a good job at stitch fix the etsy quarter was just absolutely on fire etsy is -- i said something where they were cheering at etsy i said they're sticking it to the man! >> stocks set to rally at the open china says now new trade talks with the u.s. will take place later this month adding it will

send a delegation to the u.s. to be led by the treasury undersecretary last night on "mad money" senator elizabeth warren told jim she has a problem with the current u.s. trade policy. >> i'm worried about trade policy that has been written largely by a handful of multi-national corporations. that it has not been written to enrich americans it's been written to enrich those who play above that sphere >> what did you make of her comments >> those are the same ones that peter navarro would tell you which is that there is large national companies that sold out the american worker. it is really interesting that the left and right come together on the idea that perhaps the worker, the steel worker, has basically been sacrificed on the order of prell the aluminum worker sacrificed on the order of diapers. we wanted the procter & gamble market so badly, they say we'll sell out our own people. because we let them dump steel all over the place

they dump it not here but in places like turkey what happens is there is this bizarre alignment between senator warren and hardliners on trade who generally believe in both cases the worker's been sold out but want to accomplish worker growth in different ways. >> so the argument that we embraced china trade because we wanted cheap china-made goods. is that wrong? >> well, no, because we kept inflation down but what i think that senator warren's talking about is we literally -- the traditional union worker, traditional industrial worker, was sacrificed i think when you look at -- let's just tie it all in you look at the opioid epidemic, it tends to be in towns where the mill was closed. my father worked for paper mills. they were all closed that was something that we ceded to the chinese to be able to have low-cost goods and be able to sell ge engines that kind of thing i just feel like it is -- i

marvel at how much senator warren is like peter navarro who's the hard trade advisor i'm getting hated -- i get a lot of hate mail from everybody. i really like that because i am a masochist of the first order >> there is a crazy sir clarici in some of these policies. when we come back, cisco got upbeat results and guidance giving the stock a booth today the ceo, chuck robbins the worst s&p in about seven weeks, but futures are up big. back in a minute at&t provides edge-to-edge intelligence, covering virtually every part of your business. so this won't happen. because you've made sure this sensor and this machine are integrated. atta, boy. & yes, some people assign genders to machines. & with edge-to-edge intelligence, you'll know your customers love this color, & don't love this one.

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simple, easy, awesome. in many cultures, young men would stay with their families until their 40's. technology company cisco out with strong results. tremendous guidance, frankly it continues to be more of a software company, of late, than a hardware company joining us from san jose, the ceo, chuck robbins chuck, congratulations on a monster good quarter >> hey, jim. thank you. good morning hello, carl. good to be here. >> all right now let's get right to it. when i listen to the conference call, i said to myself, this is not a hardware company that sells routers and switches, although it still has that this is a software company that manages to have much better

margins and is really on fire. are you more of a software compa company? >> if you look at the quarter, first i think we laid out a strategy a few years ago where we were going to continue to evolve and add more software assets to the company, deliver more of our technology in the way that our customers want to consume it, as sass offers i think clearly that strategy's working given the results that we put out there as our customers navigate this new multi-cloud environment that they're operating in, the product innovation that we have delivered to help them with this next generation infrastructure is clearly resonating with them. we saw our infrastructure systems up 7%. applications were up 10% security up 12%. then the transition that we put in place from a software perspective is working, as well. our total build and unbuild deferred software revenue was up 28% year over year and our product orders were up 7% year over year. overall it was a good quarter

and i think that the strategy's working and the transition is actually moving forward. >> chuck, you made a series of acquisitions within the last couple years, since you took over to me, i was not clear about where they were going but they really did kick in entirely this quarter, didn't it >> well, jim, if you look at what we've done, first of all, i want to just give incredible kudos to the team who's built some amazing internal innovation we delivered this intent-based networking architecture last summer in the catalyst 9,000 which always carries a software subscription on top of it. it is the fast s ramping product in the history of the company and last quart just continued that momentum. our teams have built some incredible innovation. at the same time we've added to that, through these acquisitions, most recently we announced our acquisition of duo, which is going to provide a critical part of our security architecture going forward around identity. if you look at that, and at app dynamics and success we're

having about application analyti analytics, these applications are playing a key role in addition to the great innovation our teams have built >> there was a moment on the conference call where your cfo says i think the environment's very strong. she's speaking about europe but cisco's a big company. the world has to be better not just united states if you're putting up these kinds of numbers. >> well, jim, if you look at what we've experienced over the last few quarters, i heard larry on earlier on cnbc he talked about the economic expansion that we've seen. this quarter from -- it was broad-based for us we saw our order growth across europe, across asia, the americas, was all -- it was 6%, 6% and 12% orders grew, commercial was up our service provider sector came back to 6%

emerging countries was up 12%. so it was a broad-based performance. it is a combination of two things, as i said on the call yesterday when i was asked about this we have clearly created a great deal of innovation with the solutions our customers are looking for, at the same time having the benefit of what we've seen from a very strong economy around the world >> chuck, one thing -- i'm not nitpicking but i am confused you talk a lot about molding cloud strategy from what the customers want but i really don't get an amazon web services aspect. i don't get azure. i see you got a good relationship with google but we know they are a distant number three. i didn't hear a lot about say a combination with vm ware what are you doing to make it so you are more agnostic and less focused on a google cloud? >> yeah, jim, we have announced already a partnership with microsoft. we've been doing work on hybrid cloud offers, into azure we announced support for azure stack over a year ago and our

teams have been working on that technology we are doing security work together by definition when we say multi-cloud, you can assume that we are working on enabling our customers to deliver security and policy from their private infrastructure into any cloud that they choose you can assume that we are going to enable that across any public cloud or sas provider with this massive influx of iot devices that our customers are seeing. so we are going to engage on all fronts >> chuck, i always hate to go macro on you but just forgive me this one time. it's been such a crazy week with the market obsessed with emerging markets and dollar denominated debt i know it is early, but just shine a light on it from your point of view and does it make the current quarter guidance any cloudier than it otherwise might have been? >> well, carl, i'd be shocked if you didn't go there. look right now if you look at the

things that are going on around the world, even in the last few weeks, we certainly see the strengthening dollar which typically leads to some stress in emerging countries. we've seen what's going on in turkey we've seen over the last few quarters what happened in argentina. we've got the trade dynamics going on on a global basis right now. so there are issues out there that we're watching very carefully. and that certainly we aren't immune to. but based on what we know today and what we see in our business we called what we felt for next quarter from a guidance perspective and we're just proud of what our teams have done. >> chuck, we know -- you and i know we are looking for say long-term dynasties, kind of -- like eagles versus the setting dynasties of the falcons i want to just mention "wall street journal" writes, over the longer term, cisco will remain challenged by the mature nature of its largest businesses. how do you respond to that >> well, i think that same article was written a few years ago, as well

so we have made a lot of progress we've brought innovation back into the core network with software subscriptions that are renewable over time. i think we are introducing more predictability into our business model. so i would say much like the resurgent falcons, or maybe even the resurgent 49ers, i'm very confident in the role that we're going to play with our customers in the future,jim. >> look, we do have a lot of noise in the background. 5g was the thing on the call 5g is just beginning to me that may mean cisco's run is just the beginning. what do you think of that analysis >> when you think about 5g, the promise of 5g is to create significant high-speed connections at the edge of the service provider network, which in turn just logically requires a great deal more capacity in the core of their networks which is where we play so we've been having discussions. i've talked about it starting at

mobile world with these large customers around the world, relative to how their networks will evolve to accommodate all this traffic that they're going to see coming on their networks. so we think that's going to be a nice growth opportunity for us i have said that we're in the early stages of discussions and customers will begin to deploy at various stages but it will definitely be a significant upgrade cycle with service providers over the next few years. >> once again, zblacongratulati. chairman and ceo of cisco, chuck robbins. >> no falcons/eagles trash talk today? >> look. i'm ecumenical frankly, he's going to be a graceful loser when we have the homeowner on nbc it would be difficult to travel and be in the box. but it is nice in defeat, he's really admirable and humble >> no chance to retort >> no.

that's why we cut his mic off. >> thanks to chuck we'll countdown to the opening bell in a few minutes. s some representatives here from the u.s. navy to ring the bell eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade i wok(harmonica interrupts)ld... ...and told people about geico... (harmonica interrupts) how they could save 15% or more by... (harmonica interrupts) ...by just calling or going online to geico.com.

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about six and a half minutes until the opening bell jcp is going to have a tough story today.

>> despite positive -- i thought positive sales comps for the quarter and year-to-date, are you kidding me surprise loss. they are still doing a running back by committee. we don't even have a ceo they talked about markdowns that are big. this is the ultimate share in the mall now that sears is barely a pulse there. i was aghast when they tried to say it was a good quarter. the only hint in this one-page release that things are not that great, they said we took necessary actions to mark down and clear excessive inventory positions. i don't even know what they are anymore. i don't know if the millennials, i don't know if they're trying to seven women -- i don't know what they are. yes children's, jewelry, women's apparel were the top performers. a lot of other things were not this is what happens when a franchise completely erodes. >> they cut their guide badly. this implies a market company of i think $600 million

>> which is incredible >> which is half of a fit bit at this point >> there's tens of thousands of people who work there. they've got to pick a ceo. they've got to -- remember mark nelson went to lowe's. when you're having a loss, people expect you to gain. when you have disappointing comps, you own it. name a ceo, we'll do this right. we've got a strategy this thing was wrecked a few years ago. >> we'll contrast this with walmart's action today e eng lln minute

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♪ come on. come on, squirt. (dog barking) whatever your financial goals are, a u.s. bank wealth management advisor can help make them a reality. talk to one today. u.s. bank - the power of possible. you're watching cnbc's "squawk on the street. live from the financial capital of the world, opening bell in just under two minutes busy thursday as we are looking at the first u.s./china trade talks since they broke down in june larry kudlow confirming that on our air a few moments ago. nice call on boeing over at ubs. this is going to help the dow. obviously walmart's blow-out numbers. now some headlines from the turkish finance minister no plans for capital controls.

no imf plans focus on attracting foreign direct investment. free market principles will be our framework. that's probably going to help a little bit >> i think so. the imf came in there in 1993, pretty much wrecked them the imf always gets its man. they instill a level of discipline that's frankly mission impossible but they get it done. i do think that turkey's side show -- notice last night china opened down very badly our futures were therefore muted. then china came back a little. then as china futures came back then you started see u.s. futures go up. people feel that last half-our move was a sense that some people knew that maybe china talks could start again. it is probably the most important story out there given the fact that much of the nature of our market has to do with the industrials -- >> well said yuan up the most in about six months >> they're trying. maybe xi is sending signals but the stock market is sending a

signal you can have a command economy but you cannot command stocks to go higher. >> there's the opening bell and the s&p, left side of your screen, big board today, the united states navy [ opening bell ] beautiful turnout today. we don't need to remind you of the price weighted impact of the dow. targets 515. >> there are some bottlenecks at ubs. 1 out of 4 planes goes to china. there's been this forget it, it can't work, it's going to be the worst one hit. i have contended over and over again that china needs boeing more than boeing needs china i don't -- i think it is going to be football every time there is a negative

about china trade, it really doesn't matter whether you've got a $500 price target. any thawing and the stock goes right to $400 because the company's in juggernaut right now. it is incredibly well run. woeg h boeing has the right planes. >> they see china tariffs as opportunities to buy their 2020 free flow cash estimate is good >> december 7th the stock was increasingly lower when the ceo came on "mad money." it's obviously been stalled. a lot of people say this and caterpillar, the two stocks you cannot own because of china. i say these are the two stocks you can own if china breaks and china can. i know xi is regarded as being all-powerful leader. what do we keep reading? i don't know how powerful he is.

i know boeing's powerful >> i read every table is a sea of red >> they should never have started a stock market you get a bear market. that is not what the communist party wanted the 10 cent quarter, it was almost like they mandated a shortfall. you play with fire when you go over there and invest in stocks. they're good at being communists, they're okay at being capitalists. >> they a look at tencent. as for the leading dow components, the three names we talked about -- walmart by far the leader, followed by cisco, followed by boeing >> cisco's really a story. cisco had been a company that was very hostage to service providers. in other words, the at&ts. they had been very hostage to whether they had a lot of hardware buyers. they do have a good piece of

hardware but chuck was built an ecosystem that makes it so you really do have a lot of good i like the way he clarified my thought about whether he is doing enough i just don't see amazon in it and i know that it is sensitive because the battleground in the country right now is are you going to use google cloud or are you going to do azure -- that's microsoft -- or are you going to use amazon web services. i like that chuck said we're agnostic, we do all three. walmart has a deal with azure. with all of what retail is about, it is about the strength of the consumer because of job growth, but it is the recognition that they figured out omni channel i think that matters brick and mortar can be an asset is what this quarter is about. it is not just a liability >> the spread between store and non-store sales growth is the narrowest it's been in three,

four years so brick and mortar's trying to figure it out, online realizes they need some brick and mortar. >> we'll hear from target next week i think that will be interesting to hear. brian cornell has said, look, this is something i'm dedicated to i think he's doing it. i think that if you don't do it, if you're not online -- jcpenney is not an online company it takes a tremendous amount of investment to be online and you do hurt your earnings when you do that kind of investment but they've been great i am still marveling by the way. i think home depot was slighted this week. i think home depot is a housing play just because there's not tremendous turnover in housing doesn't mean people don't go to home depot and remodel >> fix what they have? >> i think that stock can come back think it was unfairly lumped in with mortgage rates and unfairly lumped in with housing and affordability. that's a narrative i think should not define home depot >> look at starts today.

.9%? >> i think 10% of the economy is housing. punches above its weight there is a lot of answcillary plays to housing but one thing i'm not worried about is home depot's ascendance versus other companies in the industry home depot is a share taker by the contractors. when you remodel, the contractors go to home depot i am not going to sit here and say, home depot doesn't know what it's doing. home depot had a great quarter, and i am just aghast at how people have turned on home depot because it's got the word "home" in its name. >> take a name like deere today. down 12% for the year. but if china talks really start up again and farmers don't have to worry about their soybean prices and they can afford to get that new combine, do you think a flyer on these talks >> i would buy calls of deere.

when you go overseas and you try to buy a john deere, the tariffs on john deere -- if i were the president -- i know the president is focused on steel and aluminum but we don't make a lot of aluminum in this country. if you just focused on john deere and the taxes on the tariffs on deere -- everybody knows they make the best farm equipment. nobody wants them to come in to their country because they are superior the president should be making that the issue larry kudlow should be making deere the issue. yes, i would take a flyer if he if elt th felt that was a possibility. remember, everybody tries to go after deere. deere is like boeing, like caterpillar. if we had a level playing field deere would be doubled right now. yes, the farmer needs more money. the farmer is being hurt it is true by china. and if china solves, farmers solved, deere solved >> president made interesting comments regard being steel and the future

>> the earnings have done quite well but -- u.s. steel, letter x, is nowhere near the caliber of nucor, the largest steel company. i find it is fanciful -- wrong -- that nucor is where it is at $61 i think that's a buy i've been right -- and then wrong. it is astonishing how poorly the stock acts in an environment where they are the winner with tariffs. >> let's do our daily tesla check. stocks down .5%. you got these widespread reports of an s.e.c. subpoena. additional reports of a would-be whistle-blower with information about safety and waste and fault. >> right two issues here. we started to hear all these stories about how there are lots filled with tesla. i have no idea tesla bonds sell back to $90

the bonds are a better, more accurate tell of tesla's actions than the stock an interesting report this morning about the stability of mr. musk pass a very tough article and it basically i felt questioned minu mental state obviously i think the man's a genius he's mortified me. that's okay. who hasn't i just find that jim's piece was questioning whether i think he should be running a public company. >> inappropriately harsh in your view >> i went back and forth with jim on this. i've known jim since 1979 so it's not fair-weather friends here boy, i'll use a term that -- the rich aren't happy, it's their own fault. i read this and i felt bad for musk he's working really hard and he

seems very fragile, was the way. now if e's watching -- who knows. >> i don't think he is >> probably not. he's at the factory floor because he works 120 hours a week this piece was about the fragility of the man and frankly how close he is on the precipice. i found it just sad. i thought it was sad i hope it's not true >> we look forward to checking in with jim on that piece in a little while >> you going to have one >> i think so. if not today, tomorrow one last point on twitter. jack dorsey talked to the "washington post" and "nbc nightly news" about the way in which he is thinking differently about the platform take a listen. >> do you have regrets about how you acted in terms of some of the sandy hook allegations, that it was a hoax? >> i do feel terrible at what the parents had to go through. i think we have felt behind and we have felt that we have moved too slow in a lot of our actions. >> now he's thinking of ways to

label a bot account, for instance, or surround false tweet with context or correct information. >> i think he is actually struggling, and on point with the struggle now remember, i would hate to transcend -- look, i'm -- the quarter wasn't so good a lot of people feel perhaps the momentum had to do with some things that are either untoward or not honest in terms of their daily advertisers. i think twitter's doing quite well it is very much in the mix they want to be on twitter but they really want amazon and they really want google that's where the money's flowing. i think there are some people who say twitter -- until twitter gets its act together and gets rid of this stuff, we'll hold back some spend but we will still spend there. >> you would take the same stance with the shares >> i like the shares i think it is inexpensive. jack dorsey has two companies, i like square where they are doing

everything right it is just a financial tech story that's just -- knows no bounds really fabulous. >> we're up 283. best day since july 7th. do you think we have effectively suppressed em concerns >> no. >> it doesn't go away that quickly, does it >> no. the bears can't just roll over like this. interesting, amazon is only up 15 points. it is up on a percentage basis far less than walmart because a lot of people feel it is zero sum. i don't think it is. by the way, nvidia tonight i think nvidia's got a problem in the quarter in terms of going up against the cryptos my view on nvidia is long term you bet on jensen wong

if it does have a quarter that looks weak, it has a lot of noise and the stock goes down, that may be your chance to get in to something that most people haven't had a chance to get into it jensen wong being a genius >> it's locked out buyers for a long, long time. >> jensen is a humble wild man in that he comes on, he wears the leather jacket, he talks a real interesting game. but the man is a visionary he is a 20-year visionary. amy grove, the late ceo of intel, had a vision. this man's vision is transcending most of us. i like to have a glossary next to me on the conference call because he's just smarter than everybody else and by the way, i don't know an executive in silicon valley who would disagree >> that's good insight dow's up almost 300, obviouslyo losses dow outperforming the s&p 100% walmart opens up $10 and cisco

opens up, what 2 f $2 or $3 boeing up $3 the dow dramatically outperform being the s&p. speaking of china talks, look at futures overnight. we are getting word about these what they call low-level china talks around 10:00 last night. we moved immediately 10, 12 points on the s&p futures. that's a sign that what really still moves the market here in terms of market issues, let's put the list up here, is still china tariffs and concerns about slowing growth around the world. that's what moves our markets. yes, we are still concerned about emerging market contagion and a little less liquidity out there. money comes out of emerging markets and the question is is it confined to emerging markets or does it spread? we don't know. certainly i think the china tariffs is what moves the markets here in the last two weeks we have seen very ugly emerging market trends on the stronger dollar

and contagion issues and commodity stocks it is very unusual to see just a couple of weeks china internet stocks down 15%. miners, steel stocks, copper miners down 15%. this is two weeks! emerging markets dropped 8% overall. very rare to drop that fast. they are usually not that quick to move around the relative strength index measures how quickly the speed change of price movements are. when you are begoe low 30 you ae oversold below 20 you are really oversold but low 10, that's like four standard deviations away china internet, gold miners, steel, copper miners, emerging markets. you rarely see such selling. but that's a clear sign that the markets very much overreacted. you see today what's moving today, guess what. it happens to look exactly like this chart so there's what -- we had the global markets here but you see some of the sectors like metal to mining, china internet

stocks, gold miners and steel stocks they are the ones that are all moving my key point about all this, there have been individual sectors of big damage in the commodity space and emerging market space but overall if you look at what's really going on, this is why the u.s. is still the place to be. global contagion concerns are still largely confined to international markets, not the u.s. the russell's only 2%. s&p only 2% from its historic highs. you can see there we're more than 20% off the recent 52-week highs in some of the big global markets, particularly china, brazil, even germany is still 10% off its highs. united states still the place to be 300 points up on the dow carl, back to you. >> bob pisani, thank you let's get to the bond pits, rick santelli at the cme in chicago. >> good morning, carl. i was very happy that bob showed the futures with respect to how they bounced on headlines regarding talks resuming between china and the u.s. because as you look at a one-week chart of 10-year, you

really don't see that in the fixed income markets now i'm not saying that wasn't affected, but not in a huge way. as you look at the 1-week of 10s, realize that we've spent a lot of time in 280s, right here we hover around 286. the point being there definitely was, maybe still a lingering effect and flight to safety, it is just not a huge one you can even see it in the yield curve, about 26 basis points, 10s to 2s. and many say that one of the things you may see as these trade talks move through the system and maybe you seat the barometer ease back a little bit on some of the nervousness regarding those issues and their effect on the psyche of investors might actually be a steepening of the curve. think about it will it be possible that the fed will take this more into consideration? i'm not saying it is but i think you can make a case for that now as you look at a 10-year, realize that we are hovering

yesterday at the lowest close since around july 19th when we ended that run of the 2.80s and started the 2.90s be with foreign exchange had gone through a long period of time where it wasn't super volatile it is volatile again look at the dollar verses the yuan everybody's been paying close attention. a bit of a reversal today, from a level we haven't seen since the very first trading day of 2017 which was the 3rd of january for china. maybe what's more interesting is yesterday when we were at that level it really wasn't very far from a 10-year low of the yuan versus the dollar. so we want to keep a very close eye on that. when you look at commodities -- and everybody is -- remember that all markets have moved in an opposite direction, obviously today. it is moving from a level we haven't seen since december of '17. finally the last chart is the dollar index you can see one week

i do believe that some of the quicker appreciation dollar index was driven by the notion of nervousness regarding finding those dollars to service dollar denominated debt in some economies that were the most volatile since last friday that doesn't mean that the dollar index has to go down for all this to go away. it really is about the speed at which it was moving higher carl and jim, back to you. >> rick, see you in a little while. rick santelli in chicago mpl a look the dow jones industrial average back in a minute hi, i'm joan lunden with a place for mom,

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madonna. let's get to jim at "stop trading. symantec is down 29% for the year, jeff smith's star board is proposing a slate. this is a terrific company that's been performing poorly. it's got an incredibly cheap valuation. if we listen to chuck robbins, it's an amazing industry if they let jeff smith do it, this may be the cheapest stock in the s&p and should be bought, right here if they let him. >> they've got a few candidates for that >> symantec, i was so glad that somebody took a stake in it. >> how do you follow up last night's "mad money"? >> there's a terrific guy, people like income who watch the show, we have a lot of people who are searching for fixed income that is safe and that's nick akins i like nick because he's got the best view of the economy, because he's the largest

i just like the stock so much. i really want people to have a balanced portfolio, some income and some growth. >> how do you want to leave people feeling today, given this gain, after yesterday's loss >> >> i always think there's more shoes to drop. there is always a risk to the shorts, because of turkey and the trade talks we're going to have with china. and larry kudlow comments today, is giving you the signal that we're winning the trade war and it's very tough to be sure if we win the trade war. >> it's pretty even couraging words about e.u. relations >> wasn't he >> nafta, these are things that if they go right, you're going to regret that you're not more in but like i said, let the shorts do another attack, another raid. then you got to buy. i said last night on "mad money," you got to buy the dips.

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good thursday morning. welcome back to "squawk on the street." i'm carl quintanilla we're watching china-u.s. trade talks and boeing and making waves in the battle against amazon, walmart reporting blowout results. the retailer has its best growth in a decade. we'll tick through the report straight ahead quote, our economy is doing better than ever, weighing in on inflation and business optimism, stocks are surging this morning. >> and the ceo of twitter on why he's rethinking the core of his company. let's get straight to the

markets this morning stocks surging on renewed hope that a resolution in the trade talks with china could be on the horizon. larry kudlow addressing this on "squawk box. >> america is crushing it right now. the world is investing in the usa. judging by the weakness in the chinese currency, the world is not investing in china my point is a simple one, give us market openings, take down your barriers. stop trying to capture and steal technology from the u.s. and western countries. give us a chance to compete, we will sell a ton of exports to china. that's the key point they know what our asks are, perhaps, let's be optimistic, they'll fall through and some good will come >> president trump echoing the strength of the economy in a tweet this morning, writing, quote, our economy is doing better than ever, money is pouring into our cherished dollar like rarely before. companies' earnings are higher than ever, inflation is low and

business optimism is higher than it's ever been for the first time in many decades, we're protecting our workers. joining us now, jeremy siegel at wharton business school. jeremy, do you agree with that >> the economy is doing well, there's no question about that, and i heard larry kudlow and that's what he was emphasizing i mean, the biggest issue facing the market is the trade negotiations with china. i actually thought larry sounded more optimistic about the nafta part than the china part the china part is the biggest thing that's going to affect the market in the remainder of this year >> is the market right to celebrate? i mean, yes, we do have walmart and sysco earnings helping the dow, but is the market right to celebrate sort of this idea that they're at least going to come to the table and have talks in light of the threatened $200 billion worth of chinese imports

that president donald trump wants to tax >> it's the first move, and larry did say it was a small move he didn't want to overemphasize that we need that movement. if we could get resolution with china, this market could pop 10%, there's just no question. however, on the other side, if we get a trade war with china and we get those tariffs on, wow, i mean we could have a 20% drop so we really have these two scenarios going forward and i think the market is trying to sort that out. but it is encouraging. you got to start with talks before you're going to have any resolution >> professor, in light of that, and given the fact that you do have these uncertainties that could swing either way, what do you think about these u.s. stocks until the end of the year here >> there are some challenges i think the fed is going to

raise rates twice. i think we're going to end the year on the 10-year at 3 and a quarter. so i don't think this is going to be a super great year for stocks i mean last december you had me on, and i said zero to 10%, and we're in the upper part of this range, and a lot of this does depend on what was with chandlechandleina. if we don't get trade wars, i think we're flat for the rest of the year but i think the trade negotiations and hopeful solution is going to be the big mover with the fed, you know, being the second most important factor here. >> what about turkey did that shake your confidence at all in this market and in this global economy? and especially the contagion factor, we saw, not necessarily an all out emerging markets crisis, but certainly there was spill over >> there was spill over, and we have argentina, we have the

ruble. however, i think turkey is a unique situation in a sense that i do not think that we're going to get contagion and i think, you know, a month from now, six weeks from now, no one's going to be talking about turkey they're going to all be talking about trade, and of course we have the midterm elections coming in november, with the democrats, at least the odds makers saying retaking the house, that's going to make for some stalemate, not a bad situation necessarily as long as the gop holds the senate but these uncertainties with trade, the election, the fed being on the aggressive side i believe toward the end of the year, i think are going to keep a cap on any really summering stock market we have but resolution, obviously, you know, we can see a really nice pop in equities. >> professor, maybe we're not talking about turkey so

specifically, but as we do seem to move forward in this period or the shift i should say away from quantitative easing to quantitative tightening. >> a lot of people, for instance, a lot of people say what can china do? well, they hold well over a trillion dollars worth of u.s. government debt and they could say we're going to place our money in the euro or countries that have been more friendly to us then we see the 10-year pop to 350. that's going to put a lot of downward pressure on stocks. i don't think trump wants it to get that far but don't think there aren't things that china can do if trump takes a very tough position on his negotiation.

so i still regard that as the big uncertainty. as far as, you know, the debt is concerned, certainly a surging dollar does increase the dollar denominated debt of foreign countries, but at this particular juncture, i don't think we're anywhere in the situation we were two years ago with the collapse of commodity prices that we saw at the beginning of 2016. i think this is a temporary blip on turkey and refocus will come to the trade negotiations. >> are you under estimating the boom as larry kudlow says in the u.s. economy and that 4.1% growth last quarter, it looks like we're going to have another strong quarter, i know it's early, but after that retail sales number, gdp is tracking in the 3%. and i'm surprised, because you've usually been, professor, pretty strong on the u.s.

market i'm not sure that this better sustained economic growth has been built in. >> okay, first of all, you know, i don't think we're in a 4% economy. i do think it looks like we have ratcheted up to a 3% economy the -- you know, the forecasters i look at are looking at 3.1, 3.2. by the way, there's been reports in the second quarter, some actually have that from a 4.1 down to a 3.9 economy. i think we're at a 3, i think that's a big improvement over 2.25% that we had before and that also means a higher interest rate, so that means the fed is going to be a little bit more aggressive on that side still, with the labor market, we saw jobless claims again very strong this morning, labor markets creating 200,000$200,00

$210,000 per month that continues the fed tightening, that's the thing the market has to look at. i'm overjoyed at this rapid upward growth, but it isn't something i think will make the stock market by itself boom for the rest of the year >> especially if the fed goes forward as planned, jeremy siegel, good to check in with you, thank you with the dow up 324, and walmart, up both on the top and bottom lines the comp store sales well above consens consensus. walmart raised it's sales and guidance for the year and it's making head way in its battle against amazon because e commerce sales jumped 40%.

those are just a few of the highlights sam's club very strong, comp stores increasing 5%, that was double what was expected the only thing to explain about is that margins declined it still costs a lot to get this kind of growth >> and walmart has increased it's growth and you have seen some analysts say there's some margin pressure as we go through the end of the year. the consumer is alive and well, at least here in the u.s., you have strong economic growth and it's playing out in the retailers, except maybe jcpenney >> the narrative seems to be amazon and walmart are finding ways to co-exist at the expense of a lot of other players, whether that's j.p. penny today or nordstrom at the end of the week >> keep in mind, grocery sales

are such a big chunk of walmart's overall sales. i was talking to courtney reagan about this, grocery sales rising the most in nine years, and a growth toward fresh foods, pa >> hasbro, cody, there's no halo coming off of walmart today because walmart is the one sticking it to them. >> and there's also the setup difference because walmart was down .8 going into this report, macy's was up what, three figures. an interesting thing to look for, in terms of how to invest around retail, look at where their products are made. if they have a lot of supply chain imports in china, for instance, he said tapestry does not. you would think that all of retail does, but that could be

one point of differentiation of the trade talks with china >> our economics reporter steve liesman joins us now with the country's rates moving higher, hey, steve >> several big central banks continue to ease, the direction of global monetary policy unmistakably toward tightening take a look at this map of the world, blue is tightening and red is easing and white is neutral. you can see there's a lot more red than we have had the past several years, argentina up 5%. earlier this month, the uk went up, the reserve bank of india and the checks all follow the federal reserve. it's been a hot summer for the central banks, ten in august, in

this period of time from the summer, cannot find it easy, turkey went up 1.25% to $17.7 5 the world is in tightening mode for different reasons in terms of the developing world, the fed is having a significant impact on countries with the weakest economic growth. let's go back, september 2012, minus 9.8, where minus 10 is max global easing. just a couple of years ago we were still negative, but now we're positive it's not the rate level, it's t economic level you have to get asia back here but it's clearly unmistakable that we're going towards

tightening we're going to have to get europe here and japan to go along if we're going to have a massive global tightening. as we go to break, tragic news out of detroit today, musician aretha franklin has died she had been suffering from pancreatic cancer, she was 76 years old. alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. you might or joints.hing for your heart... but do you take something for your brain. with an ingredient originally discovered in jellyfish,

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this wi-fi is fast. i know! i know! i know! i know! when did brian move back in? brian's back? he doesn't get my room. he's only going to be here for like a week. like a month, tops. oh boy. wi-fi fast enough for the whole family is simple, easy, awesome. in many cultures, young men would stay with their families until their 40's. take a look at walmart this

morning, up almost 10% stocks boosted by an earnings beat let's talk about it with the managing director of raymond james. good morning, good to see you. >> hi, carl. >> bud, let's put the price action today in some perspective, because it's been argued at least that this has been long deserved, but they haven't been rewarded, at least since the last print enter they post >> well, they posted an absoluteliesy s astounding compr percent, the earnings were impressive, and they continue to invest in e-commerce, they continue to invest in other parts of their business, and yet the consumer seems to be responding favorably so it's very nice to see for

walmart. >> have they answered concerned about how much that investment is going to weigh on margins in the next half of the year, at least? >> yeah, price investment will continue to be a major factor, carl, and that is a factor, because the consumer continues to look at strong value, but walmart using physical assets to their advantage in terms of curbside pickup, delivery to 40% of the country in grocery and adding a lot of convenience, so we're seeing a lot of factors here, but value is very important, and walmart, they pioneered low prices, they will not be undersold investors today are looking at top line growth at comps as well as e-commerce, and we got that today, with very nice traffic at 2.2% it's very impressive to get that traffic in a tough retail environment. >> bud, to dig into the

e-commerce piece of this a little bit more, i know that acceleration is definitely a stand out in this quarter. how about flip cart, how is that going to factor into the e-commerce story for walmart going forward? >> that is going to weigh on the results on the earnings going forward, they talked about 25% to 30% if they closed at the middle part of the year, so it's a couple of weeks beyond that, so we'll have to prorate that depending on when they close we asked that question on a call with the investor relations department earlier today and they stuck by what they said in their prepared remarks that they will close as soon as practicable, whatever that means and we don't quite have a date on when that will close. it will weigh on results in the second half, and probably next year, we'll get more information on that in october when they have a meeting for the investment community at headquarters or at the home office in arkansas

>> oliver -- >> i would go with what bud said i would echo what bud said wall martin mart is focused on markets like endsindia, as we du research here, 80% of shoppers who shop at walmart also shop at amazon they're still losing money in e-commerce, so this is something we're watching in the terms of the long-term growth algorithm we like the stock, we rate it outperformed and we think this stock can hold it's own over the long-term. >> eaveryone's trying to figure out, what does this number mean for broader retail, customers tell us they feel better about

the current health of the u.s. economy as well as their personal finances. does a better walmart customer mean a better macy's customer, tapestry what does it break down in the overall economy? is it defensive or it is quite bullish? >> that's a great question, walmart has typically been a great stock. we think it's good to own the u.s. consumer. and a lot of it is grocery, it's over 50 percent grocery, when you think about what's unamazonable, costco, walmart, we also think target will have a very strong top line we also like tiffany's and lvnh and souther ee eers ca eesouth. what you have at walmart is a

great grocery business which is difficult to replicate, you have an organic business and you have a food supply chain and you have leverage versus vendors, handbags have generally had a broader market, we're generally impressed with what tapestry has done again, buy low, buy value, buy luxury >> one final question, sort of to oliver's point, how do you square the strength we have been seeing this week at macy's, home depot and walmart, without concern about housing and autos? what is the consumer prioriti prioritizing here? >> i think the concerns about housing may be overblown in terms of the impact on the retailers, particularly the impact on home depot, because much of their business has really correlated to the stock of housing and the value that housing has, as opposed to the turnover, so i think you can

overweight that concern, i think what you're seeing retail is those companies have got very good modes and good cultures and good execution, and really focus on the consumer, those are the retailers that are winning and will continue to win over a long period of time >> certainly being reflected today, guys. >> i agree with bud. >> interesting story, guys oliver, bud, thanks, we'll talk to you soon. when we come back, jd.com adding to china's tech stock selloff, what if anything will cause a turn around for the big tech pyelars we'll talk about that after this break. i love you, basement bathroom of solitude,

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dow's up 327 >> we are watching those shares of e-commerce company jd.com we're just about flat on the report this morning. investors are trying to see what

that price action says on whether it's worth trying to dip into these chinese beaten stocks because things have gotten bad enough where there may be a value situation argument into waiting for long positions the large cap chinese ticker xfi, it's up on the day after four straight down days, as is the crane shares chesapeake bay internet etf, that ticker kweb those four biggest holdings of that fund is allibabalibaba, bad net ease that industry, broadly speaking is worth buying given all the weakness we have been seeing at the beginning of this year as you can see, it's still down on the day, it's an argument given the sentiment is mixed

right now. >> what a story that's been for the past few months. when we come back, rethinking the core, jack dorsey rethinking how twitter works, what he had to say about that platform with lester holt last night on nightly news. dow hanging on to an average up 325 points "squawk on the street" continues after a short break.

good morning, everyone i'm sue herrera, here's your cnbc news update at this hour. former cia chief john brennan says he will not be silenced this after president trump revoked the security clearance of brennan another set back for the

keystone xl pipeline, a federal judge in montana has ordered the state department to do a full environmental review of the revised route. transcanada which hopes to build the pipeline wants to begin the second quarter of 2019. new zealand has cracked down on people buying homes that are not residents. there are some exceptions including people from australia and singapore. and a former librarian from utah will spend 10 months in jail after he blue $85,000 of city money on a video game of the he apparently used city credit cards on a mobile app purchase on a game called "game of war." we are watching natural gas prices trading at $2.90 off a

few pennies off the report of this stock this is slightly less than we expected in line with the five-year average. the bottom line is this, it has been warm out so demand for natural gas has been high. we are going to see those bills as we head into the fall season, you're not using heat, you're not using air conditioning but this is a little bit on the high side, not going above 3 all summer it so a little bit of a sea change in the natural gas business >> good contacts, jackie thank you. welcome back, everyone to "squawk on the street. live from post nine at the new york stock exchange. we're seeing a pretty strong rally here, dow's up 343 walmart is a big part of that story, boeing is having a strong day, as is sysco

and dow is seeing its best day since the end of june, and the nasdaq, up .8%, the financials doing well, and the dollar weaker, even the chinese currency ended higher today. ceo of twitter jack dorsey sitting down with lester holt on nightly news he discussed his decision not to suspend alex jones from the platform and he also discussed accountability. >> which do have a clause within our terms of service around public service and around newsworthiness we believe it's important for the world to hear directly from global leaders how they think and how they treat the people around them. >> to discuss further, we're joined now by "newsweek" deputy editor and former facebook news cure rate for, along with cbs news chairman.

you've been the ceo of a media company, i'm sure you've had to deal with leadership issues in your time. how would you grade jack dorsey based on that interview and the actions he's taken in recent weeks? >> i actually admire jack dorsey, i've been a critic of the way twitter per conveys hatd disinformation but jack's interviews both with lester holt, "the washington post" and the hill showed somebody who's willing to get out there, provide some thoughtful leadership, and really most importantly question the very basic premise of twitter, which is that it's supposed to provote you to be more engaged and he's saying we have got to find ways to make the foundation of twitter less divisive and less uncivil

that's a difficult job and i applaud him for getting right out there and saying we're rethinking things. >> we're not talking about social media and the role it plays in terms of content curati curation, one of the things about twitter, and we make the same argument about twitter as well if you cut down on the trolls, you cut down information from the bad actors, you cut down on revenue? >> i think more serious changes need to come i think it's laughable that dorsey is getting up there to say he's putting alex jones in a time-out alex jones is not going to change his tinfoil hat i think how the news media is using tech to talk about this is very different the people behind us in the exchange, the stock pullers, the people who are invested in these

companies, they want to see more users, if you put crazy out there, you're the loudest voice in the room. it's hard to be the loudest voice in the room on twitter and jones has successfully done that and similar people the way we're judging the success of this is that facebook stock didn't go down because of facebook news, they went down because they didn't immediate their goals. if we're going to talk about changes, more serious things need to happen than a one-week time out for alex jones. zplt >> he said to get battle ready for the media. it feels like they're just making it up as they go along, and they don't have a handle and i say they, because it's not just dorsey, it's zuckerberg and others, who don't have a handle on what they have created. >> i think there's a deeper

problem than alex jones, i think he should get kicked off because he's p ee's purveyoring is weir conspiracy theories. if you're going to be really responsible, you would hold all people somewhat accountable for their actions and probably not allow pure anonymity, you would allow people maybe to use handles or aliases, but you would know who they were, by getting their cell phone number and making sure they responded to it, to make sure they're real people and you know who they are and make them accountable. those kinds of rules would collapse the number of users and that would be bad for them on

wall street. >> it why do it? i mean how can you change the train midstream and not damage engagement, not damage time spent and not deal with the after effects of what wall street has to say about it >> you're right, it's difficult, which is why i admired jack yesterday saying to the hill, and lester holt and "washington post" saying we're going to have to reexamine everything. maybe you just say, we're going to maximize profits, we're going to allow hate and incense weird engagement the way we have been doing. or maybe you say that's just wrong, and we have got to do better as a company. we'll see which way he goes. i mean, jack dorsey is a deeply interesting person and he may surprise us by saying i'm going to take some hits, just like facebook took some hits by weeding out the worst hate on the platform, not only in alex

jones, but just th pervasive use of trolls and bottls on the platform >> what's interesting to me and what these ceos seem to be struggling with, is how we decide what is right and what is wrong. and in germany, they just imposed these online hate speech rules, they're having a hard time in courts there, determining what defines hate speech and what doesn't. >> if we're going back to the bottom line of these companies, this is only the latest ceo from social media companies trotted out and saying mea culpa if you're using all of these metrics, these type of things are not going to work. if you take these to court, and

use a legal way of judging these companies, you need to take the time to use the accountability these ceos keep coming out with these rules, but it's the news media that are pushing them to address them i think it's the news media that's been badgering jack doherty fdoo dorsey for the past week and he's reacting. government regulation could be some type of thing as far as holding the companies accountable as far as on a grand scale. but these are companies that can do what they want. >> companies have to have a conscious in this day and age. apple pulled the content, that wasn't under pressure from investors or anything else. >> you can bring zuckerberg out in front of congress and he can be like we're evolving, we're constantly going to be evolving, i don't see how this comes to a head, though >> he said the algos are going

to weed some of this out presenting false information >> if people are getting riled up in watching these call to arms from people like jones, i feel like that gets people back on there, they want to see those dramatics. and if those things continue to go on, these companies' numbers are going to do well >> have you found more traction through twitter lately as opposed to a year ago? >> as a publisher? >> yes >> facebook dominates that, but twitter is slightly up, but the stories that do well on there, these are typical the social type of stories, like the ones that people click through twitter, they're doing it because it's wilder, it's more engaging and if you have some straight news story, that's not going to be on twitter but i would say the traffic has increased somewhat on twitter, but facebook has held pretty steady

>> it feels like walter, they're damned if they do, damned if they don't, this whole facebook twitter environment, bots, how does it end and what is the solution >> i think mark wallace and those in europe trying to step up with government regulations so to me that's the last resort, you do not want that you make a good point, companies probably should have a conscience and if not they can be shame or pushed into it we're in a world where only the bottom line for investors seems to be driving things, but i think we can push back a bit on that and i think people like jack dorsey are going to say, do i really want to be somebody who messes up democracy, messes up our civil society or do i want to try to contain this platform? i think zuckerberg is doing it, i think dorsey is doing it but, you're right, they're

caught when thbetween them and r investors, but i suspect they're going to keep getting pushed by forces other than just their investors. >> i bet they're going to get pushed by advertisers, quality control is going to incentivize those ad dollars as we go to break, taking another look at the markets, the dow at a session high up almost 350. shares of walmart up almost 10% after that big beat. and closing in on amazon h.q. 2, scott jones in los angeles with what might be coming up next hi, scott. >> it's the big guessing game, amazon could decide any day now where it's going to put its h.q.-2 project, 20 cities are finalists, including where i am, l.a., does the city of angels have a prayer of winning a $5

billion development? a record card coming up, "squawk on the street.

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emerging marketing sinking into bear market territory one analyst says a key factor could trigger the next drop. more "squawk on the street" coming right up.

let's get to the cme group in chicago, rick santelli at the exchange >> i would like to welcome you from bonham this week. and everything happened since with regard to emerging markets. but in our offcamera discussion, this is really just about price, isn't it >> yeah, you have had obviously very sharper pricing in the currencies but one interesting thing we were talking about is the retracement we have had for

monday and for tuesday, mexico's currency is back below 19. >> interest rates are? >> basically unchanged and so you have had this change in the emerging markets and so that's r ee's reflective of theo some extent. >> really when it comes to trade, it really is about price, when it comes to investors, the people you work for on portfolio management, so currency -- >> the cost of dollar funding is going higher, that impacts long-term rates, it impacts emerging market currencies and interest rates but that dynamic, that the fed raised rate from 0% to almost 2%, and it's just changing the whole financing diynamics for th whole system. >> let's say nothing in turkey

really changes, let's say a lot of these hot issues don't really change, will the markets get focused on something >> because the new prices are going to attract new investors. >> do any of your clients have money that they just don't care about? would you say that these times more than any times in the past, margins are leveraged fully as they haven't been in the past. >> particularly on the emerging markets, how do you take advantage of what's happened rather than, say, panic and deciding to exit the space, it's much more on the other side. >> the turkish lira improved, does that mean that their management has improved or they have come up with good solutions? >> they're trying to raise the

speculation. >> the price adjusts in many ways. >> the price adjusts and they will realize some capital. >> the yield curve definitely flattened a bit. the fed could be deal with this with global volatility even if it settles down because of issues with the dollar and policy >> this is one of the big things for second half. we saw weakish feeling fed, weakish housing starts it is whether dollar strength and the u.s. economy, we're going to see a slow down and skull back and how the fed deals with that, it is going up is an issue for the market. >> watch the yield curve interesting to talk markets with you. sara, back to you. >> rick santelli interesting to hear from you as well. send it to jon fortt with what's next on "squawk alley." hey, jon. >> walmart up 10% on earnings. jcpenney down 22%.

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welcome back amazon could be about to tighten its short list for its $5 billion hq 2 project

scott cohn is on the road, and today is in los angeles. hey, scoot >> reporter: hey, morgan los angeles hasn't exactly been at the heart of the hq 2 conversation, but boosters say it should be with a great work force and the scale to absorb 50,000 new jobs. remember, amazon says it wants a metro area with a million or more population, a stable business friendly environment, the ability to attract top tech talent and creative thinking on locations. we have been grading all finalists with the help of the 2018 america top states for business data and other government data. we have report cards for all 20 finalists at cnbc.com. no surprise, austin and dallas do particularly well, they're in the top state for business this year, texas. so does atlanta, boston, northern virginia. l.a.'s bid includes a number of sites. nine sites to be specific, including a former aerospace plant in the san fernando

valley the city council member representing that district says l.a. could be as business friendly as the next guy >> i don't think we were the token west coast city, we were put in because we have the basics that they want. proximity to major airport we also have proximity to major port of which 40% of the u.s. economy goods flow in and out of that port. >> reporter: our report card for los angeles shows some strengths but also some weaknesses it has the population and talent but is not known for business friendliness although it has lax and the metro rail and the port, it has the darn freeways. later on closing bell, we talk to the person behind the bid, someone with a lot to win or lose, depending onamazon's choice los angeles mayor eric garcetti, that'slater today on "the closing bell." guys >> when is this decision made by

amazon, scott? >> reporter: they are not saying all that they have said publicly is that they plan to announce a decision this year now, there's a lot of speculation they could narrow that down to two or three, possibly as soon as this month that's based on doing math there were reports they notified finalists in june they would do that in a couple months. that brings us to now. amazon famously is building up the suspense which is a very hollywood thing to do, isn't it? >> it is and it is a lot of suspension. feels like it has been going on a long time. scott cohn, thank you. coming up, besides that story and the l.a. mayor on "the closing bell" bill simon with us, weighing in on the company's blowout quarter, what it means for the rest of retail also earnings from high flyer nvidia and nordstroms.

and andrew sore kin is with me today. >> split shift. the 12th employee at tesla will join us as the company reportedly receives a subpoena from the sec, former director of engineering at the company will weigh in on "squawk alley. dow up 326

good morning, it is 10:00 a.m. in arkansas, 11:00 a.m. on wall street. "squawk alley" is live ♪ ♪ ♪ ♪ our thoughts with the family of aretha franklin this morning as the queen of soul passes away at the age of 76 good thursday morning. i am carl quintanilla with jon fortt, morgan brennan. with us this morning, in