mitigating factor if interest vats were the big pain now treasuries are a buy so it's kind of a different pattern there, guys. >> yeah. one of the things we were talking about, we have been watching about it far while. dollars are moving down. it is starting to see a little more action. maybe it is different than it was yesterday. >> health care which was the leader in the third quarter selling off hard and so are financials it will be very interesting dynamic as we expect big bank earnings come friday >> yes two-thirds right now is in correction territory or worse. >> we haven't had a correction in so long all i'm trying to say is when stocks try to go down hard you have people coming out of the

woodwork saying this is everything it is the worst possible scenario we have ever seen >> if you had bought the dip all along the way you have been a winner so far since the financial crisis >> interesting hour ahead. >> thanks so much for an out dp standing couple of hours of power lunch. we'll pick it up from there. one hour left of trade and things have -- stocks have been tanking. the dow plunged 699 points about 15 to 20 minutes ago more than 2% for the dow is a a buying opportunity that we'll discuss it and president trump lashing out

coming up we'll get more from don kohn i'm excited. he suz number two in the n command when they put in easy money policy you get to hear him on cnbc. >> you'll get to ask questions as well. >> he is the guy you want to hear from today. financials, could the numbers turn things around it will be a big point of discussion here is bob at the nasdaq. >> a lot of cross currents today. very different from yesterday. a number of attempts

i want to put up the spy a lot of trading goes on it is huge and came through around 2:30 east time. i'm talking big volumes. generally the bonds, one of the more active bonds, so an awful lot of buying push up. look at ibm. we were at 141 it drops down to 148 and bouncing all over the place. a lot of stocks were doing that. we were showing you the banks. yields were down we hald a great 30 year auction.

we had some problems today oil, bigger build than expected. shove ro sh chevron, exxon, all of those stories. more weakness in staples when stocks were up. a lot going on here. back to you. >> yes stay with us over the next hour the nasdaq seeing wild swings throughout the session. sitting around construction territory. let get a look at the biggest movers taking us there

and one of the things we saw this morning was strength and technology chips were the leaders this morning but chips now down 15% from their high. it is a drag here this afternoon. couldn't hold on a few names still in the green they are bouncing off of new lows including on semi conductor also bouncing off of lows. they are chinese internet sellers. costco is up 5%. it is one of two nasdaq stocks that with positive as the index is down about 6% the big drag, look to the big tech names facebook is the only one that managed to hold up into the green. but today we are seeing big volumes in amazon as well

amazon >> notwithstanding you >> joining us we have brian and steve from am erand rick let's talk about whether you see it as a driver for stocks. >> i want you to call it a flight to safety if we look at it the flattening is also very important to pay attention to it isn't huge we have slipped under 30 bay sigs points. much is how high interest rates

are a good reason why stocks are doing what they are doing. the fed is also part of that i would like to see more of a parallel shift will that effect it? if it would you don't want to see flattening you would like to see rates move lower. the short end being sticky i think speaks volumes let's be frank here. we are off of our highest yields in seven years it made signals complicated but seeing yields move down i think is a good thing. >> do you think that equity investors or as they wait tomorrow will be by the fact that yields have come off of their highs? >> yes i think they will be void by

that i think bonds and stocks are moving in opposite directions so that what you have got is that decline in interest rates and you better diversified and we will reassure intvestors. >> how do you know if it's safe to buy the dip >> you don't flknow but investos are beginning to of a rising rate environment which we think is good news because it's a normalization of the cost of money and you're seeing that with many companies that haven't been producing cash flee for many years great growth >> do you see it as real >> not necessarily we don't think about it as growth versus value but we think of it as high record of cash flows than those that are not necessarily generating that cash

flow >> tesla is a great product. it's a great company but not necessarily a great investment eventually they will be required to generate and when you look at the space there aren't any companies that have done that. why would it be different? >> growth value, momentum, what bracket are they in? should they be off with the market today >> i think as she pointed out earlier, if they had brought the dips our clients tend to do that. we did see buying today than yesterday. it is similar names but they are not doing it as strongly as they have when we have seen other

dips i think it's pretty telling. >> do we need some sort of response from the feds a lot of chatter about the fed whether it is moving in the right direction, the president calling the fed out for being crazy and too cute what is it in your view? >> i think it's rising interest rates and trade war and higher tariffs and impact on global growth i think the fed stays quiet. the best move is not to rerespondent to the criticism. it is to stay on a very cautious

fact it will prebl dissipate and so much focus. >> hold on kicking off this morning and banks tomorrow do you think we'll liver up to the expectations is that a crucial factor for whether markets can recover? >> yeah. we are seeing a cost rising. wages are starting to grow we saw numbers from costco i think we have had a huge benefit in terms of earnings growth people will start looking to what that growth is going to be. >> sounds like it could really change the mood here >> yes that's correct >> was it on the fed >> no. it's not ton fed actually it's on stocks. one thing we haven't talked

about enough we are in the buy back period. it has ban huge force for the last several years i think it's something that might have made a difference and even small moves could grow into large moves. these things could get a life of their own. >> it is sort of the seasonal effect do you think it's making this plunge feel worse? >> i do think that i know our retail clients will be keeping a close eye on guidance they will see on companies that are providing that i think it will be really important. i think the other thing that's interesting is we have a little bit of that in that the boomers and ones that have been in this

market for a good portion of this run-up are ones that are doing more selling the peec the people that are newer to the market are using it to get into the market you a much longer duration for investing. they are sort of embracing this. >> okay. thank you very much. thank you to all of our closing bell exchange today let's get an update in one similar sub sector >> it is get and i is down this year falling about 15% from the late january level five out of the 11 are poised to

close. consumer discretionary it was hit back in late september. it was one of the few winners in yesterday's trade. >> all right thank you very much. dow is down 450 swinging around here let's take a look at some of the losers in the dow. they are almost all losers the only positive stock is pry owe shoft. you have pfizer, chevron and it follows -- >> and posted for the week to do it that's walmart. certainly an ugly steve has a look at why the market may be getting the fed

wrong. >> reporter: yes raising the question, who got it right? trump or powell? is it saying in one way to answer i looked before president trump took office. a lot of stuff happened then let's take a look at what's happening now. you have core inflation. it was for 2% this year. it came in around 2% gdp was forecasted and coming in above 3% unemployment was supposed to be four and a half. it is below 4. what did the fed do? it added an extra quarter point rate hike in response to the data the thing, the fed made the change in december 2017.

it looked like the tax cuts were going to be passed let's look at everything that happened, 1% more growth, less unemployment, tariffs a surging deficit and they were at all time highs the fed can change the economy it is as well from the president. i'll talk about all of this tomorrow you a pretty smart guy you want to talk about with coming up next i think >> we do we want to continue to discuss with you for a few minutes to what extent has the president brought this on himself? >> you know, i reported it was

going to have consequences guess what's happening that's one piece of it you certainly have a situation where there's a tremendous need to borrow more money tariffs can't be helpful what if he decides the trade war is starting to hurt the economy a little more? wouldn't it look very political like he was responding to president trump? >> i think powell does his job he is remembered for creeping

interest rates too low it may recall less the presidents who were there when they were urging them to keep rates low. so this is something -- burns is one of the people you can ask about mr. burns. it is somebody who is remembered at the fed it helped ignite the 1970s inflation. i think everybody inside the fed remembers that chairmanship. i think he will do his job in that regard. >> just note we are well off session lows the dow is down only 317 points. you were talking a but we got aheadline saying president trump has agreed to meet at 320. >> that's another piece of it. >> i'm with you, steve

the trade issue is something that also spooked the markets. >> thank you >> for more on this let's bring in donald kohn he joins us now in his first tv interview. >> so aagree with much of what steve said i think the fed is doing what it needs to do in a very strong economy. so the economy is growing at an unsustainable pace we are creating 200,000 jobs a month. the unemployment rate is coming down at some point it will add to inflation pressures. we already see a little of that but not much as we saw today the feds got to raise interest

rates to contain inflation pressures. >> so given that you think that i guess you disagree with the content of the president's comments what do you make of the fact that he made such comments about federal reserve policy whatever the content was >> so i think it's unfortunate i think the policy that was initiated under clinton and extended to bush and obama of the president not overtly entering into monetary policy gave the fed a little more breathing room so i think powell

has said very clearly that they are focused on the legislative mandate they have been given for maximum employment and they will do what they need to do to adhooef that that's what responsible public servants do. i don't expect the language of the president and attacks of the president to effect the fed. i worry about bringing the fed into what's really a pretty toxic environment and underpi undermining confidence >> it wouldn't be the first time i wanted to do back. you're a co-pilot during the financial crisis put in place this sozero intere rates for years that helped the economy and markets get back on track, is what we are seeing

today and this week a reaction to that or the consequences of that it will be painful and tricky. is this bill finally coming due? >> i don't think so. i think the fed has done a good job making it less painful than it might have been by being having transparent about their objectives and how they see their policy feeding into their objectives so i do agree as i think i said a few minutes ago that to some extent the market has revised higher its expectations for the path of interest rates and i think that revision is appropriate in light of the strength of the u.s. economy, the fact that interest rates are rising is in effect the tribute

to the strength of the u.s. economy and the need to have some what higher interest rates and some what morenormal interest rates in order to have a sustainable continued growth to put more people back to work. look, we are at about a 2% funds rate and 2% inflation. that's a zero real interest rate at a time when the economy is at or in the neighborhood of full employment and inflation is at the feds target. so i think what the fed has done has if anything helped to sustain the expansion and it's done in a very measured transparent open way to reduce the pain >> don, what's your take on how soon the rest of the developed world will be to remove their own similar very loose monetary policies how much influence is their

policy currently having on the shape of the curve >> that's hard to say. i think the ecb has said that it's getting ready to wind down and move towards normalization at some point at the end of the this year and next year. so if the euro area economy continues to expand at a decent space i would expect and i think ja span another. i think they are all in and will remain all in but, you know, it's good news that central

banks think they can move towards a more normal policy stance, slowly and gradually >> thank you very much for joining us today we hope you'll come back soon. >> you're become farmer sies charm will be meeting on the federal reserve the report coming from the washington post that they have agreetoday meet during the g20 later this year. so the question is what, if anything, will they be discussing this might be a reopening of sorts. it has sort of broken down we have seen some very hard line rhetoric over the past couple of weeks and days we saw the president accuse the chinese of trying to medal in

the upcoming midterm elections we saw mike pence give a scorching speech they were unsealing an indictment of a chinese intelligence officer extradited to the united states a very very rare move in intelligence circles where they extradite them to face trial that officer allegedly involved in an effort to steal data from american companies the meeting between the two leaders is on. white house officials told me they weren't able to confirm that meeting was in fact set larry said he couldn't say for sure that meeting had been pinned down just yet

>> thanks very much for all that we did see a little bit back for the markets. the dow is down just 1% now just 266 points it was down close to 700 points. as you can see there five stocks down we did have microsoft but others joining it apple there and intell as well >> it's the losers that are getting bought on this sort of buy the dip kind of move kpluchb cases services is now positive and the s&p just gone positive >> exxon and chevron on the bottom as oil prices slipped energy had been the more resilient sectors. let's get a summary with just

over half an hour left >> 2:30. circle this one. put up the spy we had a cell program come through. it was massive we'll do five times normal volume remember, prices down, bonds are more attractive. how about that value versus growth debate? stocks generally are out performing today they are down letss it is consumer staples,

underperforming energy so it's not over yet back to you. >> nasdaq is off a third of 1% let's get another check at what's moving. >> some of those big names that were beaten down are perking back up. they are well off the highs of this morning that's one of the things we are watching here. we are seeing selling on high volume we are seeing buying come in it looks like right now every time you have got wuchb of these rallies it is a little bit suspect. a lot of names that have been the big momentum losers are really getting hit hard here take a look at facebook. it is the cleanest shirt in the laundry hamper, if you will.

amazon looking at the worst month since january of 2016. n netflix down about 15% so these are the ones to watch it is a bid to the upside. >> let's dive into a couple more sector moves to focus in on. fns one of the worst performers today. the langs with -- bangs are suffering -- banks are suffering today. >> huge pressure to most important thing, we'll hear from the likes of jamie

diamond. if they have to come on this and say yes, there's a risk but we haven't seen credit costs or delinquencies rise at all. it is a huge positive. >> jamie said we are not seeing it yet we are not seeing the impact on business >> and they could not be better priced week to date looking at the banks there they are all down close to 5%. morgan stanley is down you look at year to date it is the index down 4%.

>> it jumps on a year they benefitted more. they were paying high taxes the most they do come in with pretty encouraging set up if they manage to disappoint that all bets are off. >> the reaction is -- >> i'm watching the consumer discretionary sector check out xlyetf it is trading higher a big chunk of this index. we just saw it is amazon which is already having a pretty tough week it is very volatile. under armour is positive >> we'll see what happens in the close. can we make it past the 3:30

mark we are not down 700 but still -- >> nike had some big moves >> the whole sell the winners theme. >> right so it was one of the momentum names that got dumped on this fear of rising rates along with technology stocks and others that were loved. >> we got comments earlier today as well. >> never a dull moment >> never a dull moment indead. mike is looking at ford for us >> yes you were talking about sol of the stocks that were up today. i decided to look at it. as we have been talking about it has been profoundly week ford has been some of those. while there's no magic secret indicator, it might be a hint of something like that.

here you see ford. it was up about 1.5% this is only one day it only counts as a bounce in a very very oversold stock sar a mentioned whirlpool has been unup all day too. it could be buying some of the deepest losers >> maybe a search for value underway there thank you. health care stocks among the biggest losers today among the biggest winners. we have a look at the sector and whether it can continue the performance we had seen all year >> yes we had seen performance and oftentimes health care is seen as a bit of a self-haven if you take a look it is off

some in the market to date the health care sector down about 4%. take a look at the insurance stock. year to date some of these insurers really outperformed aetna up 51% all of them with double digit gains. they are down less than 5% in the pull back we have seen contrast that with the tools and life sciences. these rb some of the big momentum names like edward life sciences and they are all down double digits here since the month started. we are seeing a real rotation out of some of those real momentum health care names the ones usually seen as safe

and boring have held up relatively well. back to you. >> thank you very much for that. let's dive into health care. thanks for joining us, jared i think two distinct areas, first of all, do you think they are being by the high growth tech stock brush at the moment >> yeah. i think that's probably right. i think you have a sector that is very growthy. you know, the dynamics are different especially given the election and upcoming earnings season i think we would expect this to be very volatile on a day-to-day basis which is what it has been showing over the last week >> what about this whole notion of the safety trade? which part of health care and are you seeing any flows into it >> we have definitely seen flows

over the last three months i think if you look from july through september it was some of the most dramatic as a sector that we have seen in quite some time i think the sectors that have benefitted the most from that have been med tech and managed care would be one of the stocks that has performed very well i think time will tell what happens to the sector broadly. earnings next week kick off with j and j followed by the midterm leks as well so a lot going on. do you think it will make it

well or are comparable again >> i think it's one of the most interesting debates going on in health care. we wrote last week on this topic in the context of the ten year moving above the average dif tend yield in the pace i think a couple of dynamics going on one is fairly positive fundamentals in the group when you look at pfizer and merck you this so if you're a new investor looking at income generating stocks does that produce any pause? we think it probably will. it is a little bit too early as the interest rate talk, no one has really discussed for years is coming back into the forefront. >> can you name some names for us the overall sector is down 5%.

how do evaluations look? what looks cheap >> i think the large cap space, it is very attractive stock. it is trading at a multi-point discount to pretty much every other with improving fundamentals cig that is twn territory currently involved in a deal potentially. we want to make sure we are a little bit careful there it is another one we think has been very attractively evaluated. >> thanks for joining us >> thank you today's selloff creating opportunities for johnson research chris johnson he joins us on the phone now

talk us through on tech. that's bold. >> you know what this is one of those situations where especially in the small cap area, a lot of these -- short interest a lot of investors has been built into it just talked about health care. the company still above the 50 day moving average it has been presold and it's a leader these are the stocks we are looking at it is for what we are looking to buy right now.

a strks s, the company right now around $67 we continue to see strength? energy there's a story there which makes sense. when the dust clears people are going to realize energy trade is still in place this is a little bit of a buying opportunity as long as you're picking stocks correctly >> i'm surprised to hear you're buying energy. oil proiices are getting hit it is to talk about lower global growth isn't that a risk for a sector >> you know what when we look at it you hit ton point i'm trying to avoid. it's what it's doing today should not be caring us away the last two days have been

terrible but it's hard to look at those in a vacuum and say you know what do i really want to sell based on this one move yes tlchlt has been a short term here it pulled back but the longer term view when i look three to six months out, i still look at crowd oil prices and where we are forecasting those to go. right now you're seeing a reaction to headline news. from tariff tantrums to global growth you're seeing everybody act right now. that's what creates the big -- >> well -- >> you'll find some buys here. >> have you sold any sectors or stocks aggressively in the last couple of days >> over the last coupleover weeks. we saw this because the small cap trade was coming off the table a month ago.

we started to see thet so the risk trade, investors are getting a little bit nervous we were getting out of this kwiend of. it is what we are looking at. >> erm congresswoman pining we are seeing buyers dip into these. there are people willing to put risk premium to work in the market i want to see them come back and then consequently back below the 20 level it will be a sign of strength. i can tell you when you test the

50 day moving average breaking below it on a day the enter to i think next week if with any buyings report >> so you mentioned the so called fear gauge. i think it's at the highest level since february what do you think is the main culprit driving it >> well, it's what we kind of hit on a couple of times right now everything is down it is really easy to start running for the doors when you see stocks moving. when you see them moving 3% it

is easy? >> but is it interest rates? >> no. when i look at the actual volatility it was very low leading into this pull back. so right now this is people that are out there. it's what people were willing to pay for protection what are your insurance premiums going to be? i think it is reflecting what it was mebt to do which is what people are willing to pay to protect their portfolios a couple of down days people are willing to pay out through the

nose you need to remember we are down 6 to 7% here >> yes >> we have been at these levels before. >> absolutely. >> we had a great summer and now all of a sudden a couple of bumps in the road. we'll get over it. the trend will continue to be our friend here. >> chris johnson, thank you for jumping on the line. dow down 387 chinese interflet stocks have made a big move. >> all right chinese b chinese internet names shafrp that president trump will meet at the g20 summit in november.

it is happenine stocks trading positive territory after a big trade off. on pace for the first day in 6:00 back to you. >> all right with the dow down 400. let's get back to bob. >> a lot of movement and activity a big approximaproxy for trade. so boeing dropped to 355

it rolled over a little bit since then the volume has been titanic. i want to show you the name etf. we will do five times normal volume today flushed out around 2:30 eastern time what were they doing with it a lot of turn around bought the treasury tlt which is one of the most active treasury bonds a little more interest in bonds today. it has ban very very interesting day. >> and interesting to hear about

the volumes, bob shares up. snap up higher cnbc has been following the social stocks, julia >> after social stocks fell yesterday snap hitting an all time low this as investors look for buying studenting ahead of earningsreports sit possible i snap oos largely any management team can execute on product efforts. facebook bouncing back after losing 15% over two months security recommending they buy facebook after earnings coming up on the 30th saying it is the

most controversial stock with midterm elections slowing growth with twitter higher today as well after yesterday's 8.5% drop across the sector investors are watching about headlines or privacy breaches back to you. >> thank you wilfred made his way down to the floor. ten minutes to go here >> yes ten minutes to go. you're on the show earlier in the week you suggested it was going to spike. >> we could see with the news on tariffs and international trade episodes coming up and throwing it up to upcoming earnings

season we knew it would be a volatile week. it is heating up it is not hot yet. we have to keep an eye on it >> relative to history is still quite low. we had a 4% selloff. can it go higher still >> i think so. we heated up a little bit. when this thing gets above 30 we know we are not spot where people are really on both sides. >>. >> you listed why you listed that pick up in volatility today interest ralts falling down will people will slightly relaxed? >> the fact of the matter is we did have a selloff we sort of stemmed that. we do see some interest there going into the bell. the fact that we stopped the

moves it predicated a little bit. >> how significant is the selling? >> people sort of pulling back and fading i think they were looking to do that right now >> i think we have to get back to your work the banks tomorrow they reporting how important is it that they come out and sort of stabilize this >> extremely important we think earnings will probably be okay. with that being said we will be looking at what guidance is going to be. we have to get a handle. we are happy to be here with you. >> as you can feel it is an energy down here we don't always have now at the moment

huge volumes as we approach the trade. i'm going to send it back to you. we have seven minutes left >> it is very suspenseful. we keep moving south we are down 485. just a few minutes left in the session. he mentioned the focus on international. take a look at the turkish nbc reporting they have reach add deal to release american siting sources familiar with that deal says it would include a commitment by the u.s. to ease the economic pressures on turkey and the chinese with a look at

how the recent plunge could spell trouble. >> they tell us a couple of thins. one is the market is responding and a softer doe mesing by selling the currency they have chosen not to intervene despite the over 3 trillion some say it could boost china exparts. they say it would drive up cost of commodity imports and lead to problemings for foreign debt repayments and european luxury retailer have fallen after rn ks continue to rise steve rch said he is watching the currency closely and we will get the latest report on currency goldman sachs does not expect china to be give than label but it's not ruling it out

>> the shanghai fell another 5% overnight. we have more about what's going on in terms of the economy if you follow the market it's not looking too good >> the shanghai composite is down about 9% for the week some type of trade deal if will come out >> yeah. we'll seal how they react to those headlines. thank you very much. let's go back to wilfred >> we are down 1.8% or so on the dow as we approach the close i said we would find me another trader finally i found someone that would speak to us.

talks through it it is still for sell ton bell. i told you we broke on the s&p which was significant because now you see it kind of fell. it is struggling to get back it only sets us up people should be careful at the moment >> it fell like the selling was completely >> is that a concern >> no. i don't think it's a concern at all. i think it goes to that. you have to understand, once you break those levels the rules set on the automated trading systems. they are not married to a position they are going to raise cash it's what you saw. you could feel all of a sudden the flush in the mashlgt when it happened today you could feel the flush in the market

>> which sector have you seen the most >> financials have come under a lot of pressure. you have seen utilities come out. it is certainly in the dome of today. >> okay. i'll leave you two to close. we have got just under three minutes left to trade. we are down 490 points that's shy of 2% we were down 699 points at the low of the session we are well off the lows joining me now the bob >> we had a an interesting open. it dropped the yields. it made people very happy ch. >> is that that question r key

factor >> we you. >> absolutely. >> there are a lot of comp lip kated things to do >> then in the middle of the day of course we had an enormous -- i have to tell you this. this was the biggest program i have seen. i'm talking a lot of sell orders came through they turned around and bought treasure bonds at the same time. i thought it had the smell -- the volume was so big it had the flush out. with that kind of volume you would hold it a little bit better >> i'm disappointed it didn't rally a little bit more. so much selling it had the bit i think the important thing is your microsofts, they relatively outperformed the rest of the market

your pfizer's were the worse performers the low yield stories hurt the banks. >> could be fears on earnings tomorrow >> you know dimon will have some way of saying folks, the economy is doing really well i think that's his attitude. >> and they will know if they miss in terms of earnings. >> no. a > >> and oil that, we got a bigger bill than expected oil stocks sort of fell apart. we had oil not helping and tech is a little bit better all of the value was terrible and the growth was a little bit better so i think the only important thing about today is i don't think we could say we have a

decisive bottom. >> and as we approach the close it is down about 5% for the week still have one day of trade. jefrm any down about 5.5%. ringing the bell here is a reminder that apple will always be the most famous stock phone cellar we are down 548. that does it for the first hour. back to you. welcome back to the closing bell let's take a look at how we are finishing up another session on wall street with declines across the board. the dow closing out with a loss of 546 points.

it is another decline of about 2% here. s&p takes us back to july levels on the s & p 500 technology actually faired better in today's session. the nasdaq did better, down 1.25%. it is down also almost 2%. it was financials and energy that were hardest hit today. another broad based selloff with all 11 sectors banks urn it's performs. coming up we'll discuss whether it can help jump start that sector and the broader market. joining us to talk about this market is michael and chris from bank of america, rick, the worst performer was pfizer

i mentioned it was less indiscriminant it is a little bit apprehensive. they said it was less indiscriminant the market was slightly better than it was the other day. and signs that people are trying to be discriminating i think you have to kwesquint fr that a lot of people were looking at that as a potential level. so it seems like there's traitors out there

we bounced off of there hard and we closed just below it. again, everybody becomes a technician at these times. if you bought the last three months you don't feel very smart today. >> are you a buyer or selling today? >> buying cautiously here. i have been a little more mark i am watching 2692 which is a late june level i still take growth over value i'm still worried about the banks. they are a bit beaten up here.

>> but you don't like the banks other than that? >> no. we heard about wells fargo saying commercial lending. i think capital markets activity we are not seeing revenue drivers. i don't think we'll see a lot of margin expansion here. i think margin compression is here for. >> we are showing you can is higher yields are you optistic if what is on the bond market will help. >> over the next three months wild kpgs, you have them and saying we have a lo of are hair. if you get fig mike talked about

that so the way i look at it is this. heading into technology is in many of the high. >> you mentioned j.p. morgan and wells fargo. which do you like the most >> we are very favorable across the board the consumer names in the banking sector and watch consumer discretionary if it starts to bounce can't.

>> a lot of peep people habit impact so it's the longest fchl some times you get the moets volatility it retraced a bit. i thinking that the 30 year bopd would response you 30 you're

probably a pretu champ i have heard people audiocassette about p we you testimony adds risk goes up you dope put ipgs town m fp say fp i is not going testimony listen, the greatest thing in the pli temperature --

where you spend the moets type is where where wp so some of these big support levels you really need i'm loolk ago after industrials and materials are both down tebl ity do testimony it is interesting that if you look back at january and february it had been attributed. you know what's gone up and then they peaked and came down. the stock market wasn't out of

the woods. you essentially had a lot of crowding the fact that we hadn't had a 1% day in three months causes people are wlo are concerned say i have do give it a benefit of the doubt. once that is off the table your reason for hanging in there is gone >> it is the first time since nofr 2016. >> right it is not necessarily at all >> the befrm mark did fall he what is noble that bl did we

see the lotszs take a look. it is one of the highly washed energy etfs. re let's show you where we saw the losses a lot of it being pegged shove ron dossh several chevron down about 3% a number of stocks in the communications services sector rebounding today netflix on track for one of the worst days yesterday. it paired its losses closing down by about 1.5 back to you. >> thank you

michael, kmucommunication sec sectors. >> yes look at where the stocks are going. the regulators are going to go get them you want to find growth you'll find it there. you won't find it in industrials country. you'll certainly find them these are still the ones we want to own here. >> and sea of losers up 1.3% >> and these we need to wait a couple of months >> throughout the day we talked

about the technical triggers my point is as earnings start to get announced people should start focus on the solid base of this economy and also the fact that we are not flattening the curve as much as we were earlier. if it continues to get weak it becomes a liquidity argument right now it's more of a hypothesis focus on the fundamentals and look to own people that have just gone to 20 10 to 20% on sale >> have the fundamentals change? >> i don't think they have you could say how much did the fundamentals change? i mean stocks are going to move

faster i do think that as we get closer to third quarter earnings season and next year that's greater sensitivity that earnings power will decline and last time buying yields the stock market was a lot cheaper. it doesn't mean you have to go down from here it is a lot more push-pull >> let's bring in nick with a look at what historically happens after a big market plunge like this what are you looking at to find the answer >> we just had a large downtown.

the tip so the long-term looks pretty good but the short-term feels very choppy. >> and factor in for us what we have also seen this year, the fact that we have had a big pull back in june you consider those factors does it alter your expectations for the rest of this year? >> it has ended up blg this year is -- being this year is more volatile than most we had one in february yesterday was the second one we are a little more volatile than usual so it does show me that now is much more volatile than the average even though volatility remains on average >> you're nodding at some of that is that why you think we have pulled back enough

>> yeah. if you look at the past ten years volumes are not what they used to be it could mean more volatilities on days like this where there's no natural circuit breaker there's no desk coming in and buying things for committing capitol. it doesn't exist anymore you know, everything sort of changed. we need to get ready >> and you're talking about the market structure >> yeah. market structure >> since we were showing that chart. we closed under 25 there is one kind of rule of thumb that traders follow if it closes 3 points be we low the high of the day, which we did. you to have one of those it is one of those that say

maybe we can tentively say we are getting washed out >> what are other signals? >> you want to see the percentageover stocks. all of these oversold readings when you get to these stages you want to know are people trapped? is somebody forced to lick by liquidate? >> i want to come back to the move we saw. to what extent do we think it was influenced by that slightly softer than expected and if it was that if it could change expectations as opposed to being a generic move >> i think that inflation and the fed get exaggerated when you see stocks weakening up and all of a sudden everybody that liked the economy is now half empty

it has been rather aggressive. >> yeah. i was going to say rick has talked about this for years which is an element of high frequency data it tends to come at the wrong time it confirms things you're worried about until the fundamental data it comes in one is earnings. the other the productivity you talk to companies out there right now. their biggest worry is we can't find the worker. if that's the case then the productivity cycle which is yet to hit about to hit. if you can't find the workers you're about to find more out of the current work you have. >> or aud mated. >> yeah.

the thing is it's easier said than done. the problem is how do you get it higher that sets the big issue. >> we want to get your take on this breaking news having an impact on ipos let's get to headquarters. 10 sent music is delays due to market conditions welated to global sell off. it was expected to be one of the biggest ipos this year 25 to $30 billion. it's decide today hit the pause button until at least november >> thanks very much for that >> it has been hit pretty hard >> yes the reason to do this is because

you think that the market is going to give you a generous evaluation on that and make it look better. totally understandable why you would wait unless you desperately needed the capital >> and in terms of whether you want exposure, does china concern you or is it priced? >> i am very concerned i have been hearing over the past cup ofouple of weeks, they not use it as a weapon they are thinking about it quite as bit how can they retaliate on tariffs? it is by making them more competitive. >> do you think they are devaluing for a trade advantage? >> i think they will send a message to the u.s whether it is going to work or not remains to be seen what other weapons do they have? they are running out of weapons

to put tariffs on. everyone is waiting to see how midterms turn out and hoping everyone gets to the table and make trade deals as for 10 cent music, this deal was considered one of blue chips in the pipeline. this is significant and big news in a normal day the market would have rallied -- >> we have been on that for about 15 minutes >> yes what worries me is china has a time frad and the waiting game is longser than anybody else.

so it's very much like august of 15 heading into early 16 it was a double whammy we are not getting that side of the equation we are getting one risk area and it's leading to another. >> we'll give you the final word if chinese markets, the currency continues to fall can the u.s. market continue to decouple? are we fwound play catch down or catch up with them >> historically we have done much better than the chinese market if the current environment they are not that they could decouple from around the world it feels like a more core latded draw

down >> thanks all very much for joining us we are going to stick with china. stocks briefly coming off that you are lows last hour it is on the eve of earnings to discuss the strad tensions with china. we have flick here thank you for joining us how encouraging it that is two will be meeting? >> well, talking is always a good thing i think it has been expected for a long time. this meeting has been ton

azwraen. if you're in the cross hairs it has been very material impact to your business. the overall impact to the overall s and p 500 profit blt has been immaterial at this point from the tariffs >> what's your view on what's happening and whether it's something they could lose control of >> i think they are looking at it very carefully. i think they know enough to know if they do something pushing against the market they are more likely to do damage to the

economy. so your previous session talked about how they may be thinking about competitive devalue kwags. i think that's exactly wrong >> you think they are -- their currency is under pressure from the market >> that's exactly right. >> so nick you said it's not a material impact on u.s. earnings maybe that's because the last batch of tariffs didn't go in and until the end of september eventually it has to have an impact adaughters or sons the globalsupply chain skbr okay thank you very much for joining us let's get an update on how we

finish trade we are back to join us from the floor with a sam marry >> and way to look at this is through -- etfs. >> my heavens was there self-taking volume i haven't seen this since february four times normal volume what were they doing? we didn't end that way they were buying treasuries. another big etf on treasuries. very very active that's where a lot of volume went jp morgan reporting tomorrow this drifted lower and then after that we hit the lows for the day. technology stocks okay semi conductors were generally

on the upside until we hit that. still better than the rest i want to know what was going on with energy stocks they didn't help us. the worst performer of the day consumer staples and another sign that people were saying okay maybe this whole let's sell tech and go out and buy consumer staples was over we don't know for sure bottom line is consumer staples were the worst performers on the day. >> thanks. the nasdaq dipping into correction territories we are at the nasdaq market site with oo look >> it looked so promising. up 1% ton day only to close down sort of a mirror image of where

they started the day as far as the nasdaq we saw a 228 point swing ton theday. the big tech names were negative we saw some chip names also. a little bit of bargain hunting and held up at the end of the day. apple, which had been in and out of positive territory at the end ocht day proved to be a drag we'll see if we can find some constructive buying again. a lot of these tech names it's going to be a struggle back to you. >> thanks very much for that

now. the dow falling more than 1,300 points over the last two sessions mike says the charts show we may be on the chance of a come back. it shows what their exbyty exposure is. these numbers are exposed to stocks the key thing right here is this lying down which was in the latest week. they severely cut their exposures down to in the 60% range of net exposure. this was the january and

february zone. it's not if you go way back and necessarily washed out some times you get back below 40 it is one of these straws in the wind you look to collect to say maybe we have enough people defensive enough this is pretty abrupt. >> yeah. this was a quick one actually it is coming from a lower high this is how far out on a limb. >> and i get that. it would feel pretty low like they would want to change direction again. yours is quite basis where do we get? >> you would be well below 40 or -- >> below 40 down in the low 30s at certain times exactly. what are we 7% from the high right now? you wouldn't expect it to get to

those rock bottom levels when the market has not given you that much reason to panic if you're selling it is cash, short term treasuries. >> a big competition now >> yes it's more comfortable. >> all right great stuff. let's see where it was sharply lower making it six days in a row and -- >> six days in a row of sales. s&p is down about 5.5 fk the

week it was technology. >> and volatility today spiked significantly. all three of those indexes were each of them green for parts of the day. >> all of them were higher earlier in the morning and clearly couldn't -- >> it was positive at one point. >> yes >> so we mentioned banks got hit pretty hard today. financials slipped into correction territory it is down since the recent sector high in january kicking off earnings since since tomorrow joining us is tommy and david. jason ls joins us can bangs turn

around this entire market? >> that's a lot of pressure. i'll tell you, i think there's a lot of bad news in these stocks. tomorrow is a really important day for earnings j.p. morgan kicks off the earnings season. we think it will be amongst the highest quality earnings out there. i think it's an important one to listen to. i think they could bounce off of this in my opinion what's the key factor you'll look for that would prove to you they are a beneficiary of rising rites? sure there are only two of the

margins went up they expanded and we look to expand again in 2018 including the third dwarter into next year if the fed continues to hike. so while the feds raise rates you have seen banks earn more and they have lagged in terms of repricing and we think that trend will carry into the third quarter as well as the fourth quarter. >> what's your take on what to watch out for? >> i think they are going to tell us that the last three months in september were fine. what i'm looking foris some of the conferences after labor day the companies have been telling us lone growth hasslowed

you'll maer from the best in terms of how the overall economy is doing they will tell you what to expect i'm not sure it will be enough to help the market. >> yeah. what are your expectations on one in particular? i think you're optimistic. >> so we think that it's going to be for the biggest bangs maybe two to 5% lone growth. there has ban slow -- been a slow down in the third waquarte. also we are looking for flat net interest margins this quarter may not be as robust as other prior quarters have been. we do think it will be the eight quarter in a row the banks have

produced double digits and the stocks are off a lot if you look at the stocks the large regional banks on a relative basis they are cheaper now than they were before the election they have already embedded a lot of this news i think they are generally going to tell a story of a weaker growth but i think they will tell a pretty good story overall. >> what's your top pick? >> we are constructive we think we are 4 cents ahead. i think that's the most upside i think overall we are generally constructive as well we think overall trends will be good it is resulting in double digit earnings growth. you know, basically up highs >> do you prefer banks which have got classic exposure of

retail banks as it was the guys that morgan stanley? >> i like the traditional banks. i think the money movement guys or the brokers, nobody is paying for that sit a one off open sodic business i think you want to own the good deposit franchise es and hopefully build on, you know, cost efficiencies, technology platforms in the future. >> it sowns like all -- sounds like all of you are saying the business is in good shape. does any of it matter if you see a big move in treasury yields? >> i think the bank stocks out perform as a ten year backed up.

so it does appear to be that the macro factors kind of on the day-to-day basis i think time to time a decent performance coupled with a regulatory roll back fee, you know, should allow stocks to outperform overtime. >> what's the big risk what would spook you from being bullish on the sector all of a sudden tomorrow? >> i'll tell you >> would it be provisions and credit costs >> if any of theme start to see them in the numbers that's something that might change our outlook. the reality is we don't see that

happening. >> it is one that's pretty good and you'll hear them talk about what potential risk could be the hear and now will be pretty good i would like to reemphasize that one of the prior speakers mentioned. there will be a lot of share repurchase it is not the revenue number i think we all believe that's going to be weak watch the expense number there is terrific expense control going on and i think the two you want to watch the most there are wells fargo and bank of america it will be good for shareholders >> as you say -- >> and tomorrow. >> which i'm sure will kick into gear we'll leave you there. thank you all very much for joining us

>> thank you it will break down his results tomorrow here on the closing bell at 3:00 p.m coming up we'll speak to a financial planner about how you can protect your time and nest egg from this market we are back in a couple of minutes.

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welcome back we have a deeper look into what's ban very rough week >> it has. we are dealing with a lot of issues all at once that's the primary problem that we have got. let's just take a look at two sectors. how about industrials and materials. remember what we are dealing with now we are dealing with number one china trade issues and currency issues you can see materials down there are a lot of other issues. we talk about the fact that we are transitioning from a low growth low yield world now where you bought tech because it was the only growth you had to a higher yield world where perhaps technology is not as desirable stocks are also down 7%.

maybe something else is more designable we have had that for several months now it is not clear if that is going to work. i will tell you that consumer tape staples are down only 2% for the week we have had problems overall with fairly anemic lone growth today just with yields in general going to the downside financials have been down. throw it all together, tomorrow earnings start it is a complicated picture. how would you assign the various values here? you're dealing with higher raw material costs weaker foreign currencies. you're dealing with potentially a weaker china out there how do you -- where do you sign the rates here i predict it is your beef, jp

morgan will come out swinging and make it very optimist k. he will say calm down. the world is not in bad shape and if the numbers hold up for him he has to have the internals to support it. >>. >> and i think one of the key things will be on the core consumer and business banking if lone growth isn't too bad and i'm not having to provide for bad creditlosses by the end of the day we were quite close to the lows again. >> they have been setting the context of this reevaluation for the market but i do think that it's kicked off this process of people doing this radical reshuffling and getting chased

out of the areas that have had undue indexes. china didn't sell off anymore than we did today. >> all of the sectors down more than 1%. how regularly do we see that >> very rarely >> and today you saw something really really rare at 2:30 resaw a program come through. >> you can see the volume. it is probably the number one volume that we see that had the smell of a flush out. it is very disappointing we rolled over at the close we didn't at the low that's the only bit of good

news ip don't think we settled it >> trump mentioned how well 401ks are doing. he meksed highest stock market ever >> now this downturn is the worst since his presidency began. is it time to do are you getting a lot of questions? >> not as many questions as you would think. >> i have tried to do a lot of educating. it is pretty insignificant it is what 401ks are there is a 5% correction three

times a year in the stock market it's nothing to be worried about. for the most part people are staying the course most realize it doesn't pay to have a knee jerk reaction and move all of your money to cash it seems they could do to shuffle things around a little bit. u.s. investors have a little too much in their home market and things like that so they are holding an

allocation for those we consider do it yourself investors the everything percent is 75%. ploes right where they should be >> what are you telling people >> i think it's a terrible thing to waste when a correction happens. it is a great time to get reinvested i have seen a lot of millennials have come to us which most are thinking are doing a great job but are really dconservative get reinvested it's a great entry point >> how are cash levels >> they are fully invested we want a really balanced portfolio. i'm seeing a lot of cash on the

side lines there is still a lot of cash people could put to work here. >> are you telling people to put the cash to work in the equity market >> that's right. it is really about shock observers for your 401k. it is about really getting close to retirement. now that the market is down it's a good time to buy >> okay. thank you both very much for joining us two days of selloffs could also mean two days of opportunities. we'll tell you where they are looking for market as this market plunges >> and we have a warning from investors, don't buy this dip. investors, don't buy this dip. she'll explain why coming up well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman?

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up next, we'll take a look at this wild day and week on wall street. and where to look for opportunities tomorrow and be sure to tune in tonight. cnbc has a special on the selloff, 7:00 p.m. eastern, right here on cnbc. >> some great anchors. >> the best.

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let's check in on how the etfs tracking the major averages are trading here after hours after another big selloff on wall street. we see some green on the screen in the after hour expectation. the qqq tracking the nasdaq 100 tracking higher by 0.8 of a percent. s&p 500 etf trading right now higher by 0.7 percent and dow etf trading higher by 0.9%

nearly 1% gains across the board. this time yesterday they were all negative futures this morning were lower. and ultimately after swinging between gains and losses that's what we have another 545 point decline on top of the yesterday's. >> just in context s&p futures over night the was 27045. not far below the last night's low meaning today's action was really getting us back below last night's low not incremental weakness. >> it's important to watch what europe does and asia shanghai down 5% and if that sort of decline happens again, i'm sure it's hard for the u.s. to shrug off but at the moment anyway of course the -- those etfs trading high sfleer what can we expect tomorrow is this a good time to buy the dip. >> joining us quickly for comment is david from the dancen group and john from point view

wealth management. david what do you make of the action we saw today, six days in a row, what does it tell you about where we go from here. >> i do believes in the early stages of the long-talked about transition from growth to value. i think that -- the idea that all of in is just related to higher interest rates doesn't make a lot of sense. bond yields dropped of course over the last 24 hours market prices have dropped substantially. i think you see the fight into treasuries not out it doesn't strike me as inflationary induced panic i think you had incredible froth in what we call cool tech, the big growth, high growth, high pe space. the soft relatively speak soft selloff in more defensive sectors i think continues. we love picking up the dividend yields at a higher place than we could have gotten two, three, five days ago. >> john all three of the big indices were positive early in

the morning but sold significantly from the levels. is that a concern? >> yeah, i mean yesterday and today is all about china i mean china did quantitative eastin on sunday evening why if you are economy is growing at 6.5% would you stimulate the economy? you are seeing the fear trade kick in. this is not interest rates if it was, why would treasury as gold rally and utilities rally three assets typically negatively correlated to rising interest rates this is all about china and the fears of the economy buckling. >> what are you looking for ahead of tomorrow -- druj is now leading with the stock market. >> you're seeing a lot of signs of a short-term excessive panic. i look at those things but really what you want to see on rally attempts do you see most stocks participating? does it seem more than just a little bit of a dead cat bounce? also, by the way the credit markets held together. it isn't right now much of an

economic message about impending weakness in the u.s. economy, at least not from other markets if that changes that would be a concern. but right now it's mostly stock market event. >> john, do you think china sells off again overnight. >> i would expect china to sell off again overnight. not as dramatic as last night into today it's a good sign we see green on the screen for u.s. market so you know let's see what happens in the next couple hours. >> david, what about earnings? are you looking for signals from guidance or margins that could change the narrative here for the market. >> yes, yes, yes as the earnings season goes, the market always follows. i believe that you're going to see a robust earnings season and see an awful lot of cap x announcements, a lot of dividend increases. and ultimately the margins continue to expand you have growing top line revenue. the fundamentals are solid i agree with john. there is fear. you see some degree of movement

in the fear defensive assets that helps explain some of that. i think gnat fear is china-related and just high valuations it's a really healthy shakeout happens all the zbliem david and john we will leave it there. thank you both very much full lineup coming up at 7:00 p.m., a special that sarah and mike and jim kramer and "mad money" as six but first. >> "fast money" begins right now. to you guys. "fast money" starts now with breaking news. stock slammed again. the dow now down more than 1,000 points since yesterday the worst two-day streak since february although the market closed well off the lows the s&p 50 oh down 6% from the highs. the nasdaq dipping into correction territory before closing off the levels while the russell the only marilyn index to close in correction territory if you are a retail investor watching at home tonight you have two questions how much worse could it get? and how do you know when it's