good morning it is 8:00 a.m. at facebook headquarters in menlo park, it's 11:00 a.m. on wall street, and "squawk alley" is live

♪ good wednesday morning welcome to "squawk alley." i'm carl quintanilla full market coverage this morning across the board with the s&p and the nasdaq having their best two-day stretch in two and a half years it is the last trading day of the month but an october to forget for tech. the nasdaq has a correction, facebook reversing the narrat e narrative, up following earnings our bob pisani following the rally, dom chu with a look at valuations and what's been lost this month bertha coombs will give us an update from the nasdaq and julia tracking facebook. phil lebeau with gm shares sharply higher as well but we'll begin with bob pisani. >> it's been a lousy october but it's going out with a roar i want to show you the s&p 500, what's been happening the last few days we bottomed on monday and moved 118, 120 points since then the dow has moved 1,100 points

since the bottom on monday the s&p is up 2.5% watch the beat and up groups when you see them bounce, that's when you start to see some stability, and we're getting it. since monday's close look at semi conductors up 6%. industrials up 4%. energy stocks up 4%. builders up 6% those are the beaten up sectors, outperforming good sign. metals and mining not really outperforming, that's the one underperformer faang stocks are up 2%, 3% so far this week. how about the month of november? are we going to get a better start to november? i think we'll see it we'll see pension fund rebalancing. we have oversold conditions i talked about buyback activity is on the rise. we saw estee lauder, ibm, maxim, nutrisystem all announcing buybacks the fourth quarter in the midterm elections has been up every time since world war ii, that's strong seasonal flow. how about the big movers for

november of course you've got the elections and i keep hearing -- watching these notes out democrats taking control of the house might be a threat to the tax cuts i don't believe that, but that is out there and floating around of course you're going to get maximum pressure on china for the trade talks with president xi and president trump at the end of november. i keep hearing about this infrastructure bill coming the democrats want to pay for it with higher taxes. the republicans want to pay for it with a public/private partnership but it looks like something is coming the end of november, beginning of december around infrastructure. a lot of discussion about that so a lot to look forward to. for the moment, though, we've got one heck of a rally in the last two days. guys, back to you. >> all right, thank you. the earnings story today, toe, is facebook q3 revenue and user growth short of estimates but the social estimate did most a beat on earnings the stock responding, up nearly 5% this morning. for a deeper dive into

facebook's quarter, we're joined by rob sanderson as well as our own mike santoli guys, good morning rob, you say that despite the way investors are reacting, there weren't a lot of surprises, per se, in this quarter. is this maybe just investors catching up to where you think they should have been on facebook all along the stock is still down quite a bit from where it's been earlier in the year. >> yeah, there's certainly a component of that. i think it's some of the things they did not say in terms of outlook and continued deceleration into 2019 they moderated positively and subtly their guidance for q4 and left the door open to improving the back half in 2019. but some of the comments they did not really endorse in the q & a. so to sum it all up as better than was feared. >> now, mike, it's not just facebook up this morning take a look, netflix having

another very nice morning. what was it, up 7% last time i looked amazon also up google, alphabet up. is this a facebook story, reacting to earnings here on facebook, or is there something else going on that's adding to some relief over facebook? >> i think in the lead-up to facebook's numbers, these stocks were straight down for a month so they were for sale for a very long time. a few things came together i think there has been this hedge fund liquidation of some of the high growth, high value names and that got us right up to the precipice of facebook i look at amazon's bounce today after the decline it's had it's not necessarily that forceful, so i do think that the fact that facebook got some traction in terms of the stock reaction is pretty good numbers, or numbers that reassured some of the worst worries, i think that's an excuse for in a few seasonal days to have a pickup in these stocks. >> rob, i want to get your thoughts on something else that came out of the call regarding

facebook specifically. that ad impression growth from products in the future is going to be from where facebook doesn't actually make as much money and they have going to have to spend more to stay competitive. how is that a good thing for this stock >> well, what you're talking about is the transition away from the news feed into facebook stories. the news feed is a very robust, well established, vibrant auction. you know, there's auction dynamics with a lot of advertiser activity, there's better pricing. when you're transitioning to an environment that doesn't have as much participation, there will be a transition effect now, the company is quite confident that that is as monetizable but you do have this building awareness, building participation, building a bid in the marketplace, and that's a familiar transition that we've seen in other online auction markets so i think it's something that investors have familiarity with in the long term, facebook ends up with two different use cases, one in feed, one in stories, both of which are opportunities

to serve ads to their users. >> mike, i worry a bit about this move to premium that i see across a bunch of different companies. i'm going to try to mix the product strategy with the stocks a little bit here. apple we saw come with a $1,000 phone last year and say, well, you thought that was big, we're going to go bigger pricewise this year. we saw them do the same thing with the ipad pros yesterday we see facebook making a move toward premium in terms of how they're focusing their ad product on stories, on instagram. how much of that is able to happen because we're in good economic times and might sort of wear off for the brands that can't truly sustain it when things inevitably turn down? >> i completely get the concern. it does seem as if it's exploiting both these companies' dominance in their area and they feel like they can extend it and take advantage of it i would say for the advertising side, it's not clear to me that's purely a cyclical thing

we're counting on companies to spend heavily because the market dynamics are such. in fact i think the numbers for facebook, one of the reassuring aspects was there was no real noticeable decline in advertising uptake and no real user flight, so really the stuff that looks less exciting, which is margins, is under facebook's control and ad load is under facebook's control longer term it could be an issue, though. >> we had this discussion after the last time. the pain they're going through is large low self imposed. the ad market is there >> what was the stock price then so there you go. so that's the difference, right? you started out in the $140s as opposed to the $170s. >> rob, with the tech names that you cover in terms of the corrections that we've seen, are you happy with these valuations here what would you be buying, if anything >> i think in this environment you're looking for the most high quality assets first there's three ways to look at it one is the most stable and

steady in the faang stocks, that would be google. the highest quality assets, i would say, are amazon and netflix. and if you want the one that's closest to multiple, it's facebook i tend to look for quality first and would be more inclined to look at amazon and netflix. >> well, at least some of those names are on sale relative to where they were a few days ago rob, mike, thanks. when we come back, is the economy really doing as great as president trump says it is on the heels of janet yellen's overheated warn. our next guest says the next decade will tell a different story with tech stocks as the catalyst. meantime theow i ds up 290 points or 1% we've got a lot more "squawk alley" still to come

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that simplify your experience. my name is mike, i'm in product development at comcast. we're working to make things simple, easy and awesome. welcome back janet yellen warning that more interest rate hikes are needed to avoid an overheating of the economy. steve liesman spoke with the former fed chair in washington on tuesday and joins us now with more hey, steve. >> good morning. in that wide-ranging interview at the charles schwab impact conference, janet yellen urging her successor, jay powell, to keep calm and carry on in the face of criticism from president trump. quote, when the president criticizes the fed, yellen said, i do worry it would undermine the legitimacy of the fed and its policies would be questioned the carry-on comment also applied to a recommendation on

rates where yellen said the fed needs to raise rates at least to a neutral rateto stabilize the decline of the unemployment rate i'm worried we're headed for an economy that may overheat. those remarks, along with a strong jobs report this morning, payrolls grew by 227,000 in the month of october the street was looking for 180 september payroll revised down 12,000 to 218. we had good employment in goods and good employment in services across the board there's a nonfarm payroll of 188. economists degree with the general tenor that says the job market is strong but they're reluctant to pencil in stronger numbers for friday because the two reports handle hurricanes differently. weather job losses are more likely to show up in the bls report than adp, carl. >> that's a big story.

steve liesman. meanwhile there's an op-ed in "the new york times," the economy is great, really, for now. he joins us today to talk more about that, rashir, thanks for being here. >> great to be back. >> people pay attention to mike wilson's view of the market morphing in potentially a bear market it doesn't sound like you're any more constructive on the macro either. >> i feel like the issue is this basically. the only economy in the world which is doing well currently is the united states. every single other major economy in the world has been slowing down i just feel that the u.s. economy is so stretched just now that it is likely to catch down with the rest of the world rather than the other way around, which is the rest of the world catches up to the strength of the united states that's partly because many of the indicators in the united states in terms of the consumer confidence, the manufacturing

surveys, the small business indices, these are at multi-decade highs you know, it's very hard to imagine that they're going to improve further from here. so my basic narrative is for the u.s. economy, it's great for now but this is as good as it gets. >> and then i'll go on to say when the next bull market begins, you think international takes the lead why is that? >> well, a couple of factors here first in terms of relative performance. the performance of the u.s. stock market relative to the rest of the world today is at a 100-year high or close to a 100-year high. like about the highest it's been since the great depression of the 1930s or so when the rest of the world got even more pulverized than the united states and even valuations. the valuation of the u.s. equity market relative to the rest of the world are at multi-decade highs. possibly the highest in post war history. so the gap is incredible between the u.s. and the rest of the world because this has been

america's decade america came out of this downturn or the last downturn really sort of in a much more dynamic way and it was able to cure a lot of its problems much quicker than the rest of the world. but now some of the excesses in the united states are coming to the fore, whether it's corporate debt or the government's debt. those excesses are coming to the fore so therefore, i think the next decade you should expect some of the economies which are cleaning up their act just now to do much better the basic thing is this gap between the u.s. and the rest of the world is at unprecedented levels and i don't think that this gap lasts. >> i want to push back on this idea that maybe this is as good as it gets for the u.s. economy, because i get that you have all these economic indicators here that are at multi-decade highs even if they were to come off just a little bit. case in point, gdp, we saw 4.2% in the second quarter and the first reading for third quarter that's 3.5%. i know that's coming off but it's so much stronger than the past decade. why can't we still maintain

strength here even if you've seen peak growth >> it's possible that we can maintain some strength, but here's the sort of countercyclical forces which are coming to work one, i think the higher interest rates will gradually start biting we're seeing some early evidence of that in the housing market. secondly, i think the strong dollar the dollar has been really strong i see that hurting exports, which is the opposite of what we were seeing for the first half of this decade at least. the third thing is that we still have an anchoring bias we still think that 3% plus economic growth is our natural trend line but what has changed is that the demographics of this country have changed like the rest of the world. the population and labor force are not growing as rapidly as they were for much of post war history. so i think that that's really what comes back to slow the u.s. economy down then, of course, there's an argument about tax cuts. how much do these tax cuts begin to sort of roll off next year in

terms of the fiscal impact, and what happens with that as far as economic growth is concerned so i think these combination of factors come here to basically roll the u.s. economy or push it back down from these very high growth levels we've seen the past two quarters. >> although the white house would respond it's not just the tax cuts, it's the repatriation, it's the deregulation that will feed cap ex, the current charts notwithstanding, and bring us a productivity boom that will allow us to grow and keep inflation in check are you not a believer in that at all >> i do believe in some of that. i do believe this country needs the deregulation, but i think there are limits to how much it can boost productivity immediately are possibly overstated these are very long playing factors. also the fact that we are in -- this is turning out to be the longest economic expansion in america's history, orat least it will be by the middle of next year and then at that stage,

productivity begins to decline because a lot of the resources have been used up. my basic argument in the op-ed was the fact that this gap between the u.s. and the rest of the world is as wide as it has ever been. to expect that the u.s. will remain an island unto itself and the rest of the world will keep slowing down is something which i find very hard to believe in so yeah, maybe the u.s. doesn't roll over much, but then the rest of the world will start catching up. i don't think this gap is sustainable. there's one stat which captures that the share of the u.s. economy and the global economy today is about 25%. the share of the u.s. equity market in the global equity space today is over 55%. that's a 30 percentage point gap. i think that gap to me is very stretched. >> just to wrap this all up before we let you go, you've got a stat here in your "new york times" op-ed, it has only

reached twice this level in the 1920s and 1990s. i can't help but think maybe where you're arguing that we're currently in a bubble and that's potentially going to pop with stocks is that the point you're making? >> the point i'm making is that the market cap to gdp in this country today is very stretched. that was my other point as well. i think that we do have to expect equity returns to be strong from here in the u.s. is rather unlikely because the gdp needs to catch up for the reason this is the same argument that wall street has done much better than main street because of the easy money that we have had here so as the easy money policies roll off, i do think that wall street will take it more on the chin than main street. >> finally, on the fed, people hope they back off you really don't see that happening unless something really big happens what do you mean by that >> yeah. you know, like i really feel this argument that the fed needs

to back off is so premature. this equity market has tripled in value from its lows and all we have had here is a correction of less than 10% to think that the fed needs to back off i think is rather sort of premature i think we have had this discussion before, carl, that the fed has been too late in terms of normalizing its policy. and the fed too is now getting much more conscious of the fact that it's not just inflation when you have to care about, you also have to care about the financial excesses that develop after you have a prolonged period of easy money even people like janet yellen are saying the same thing now, which is a change in review in some ways compared to when she was the fed chairperson. >> yes. >> but i think that the entire point here basically is what's the biggest thing can that happen the biggest thing is china the chinese economy is slowing down and they need to ease monetary policy but they're between a rock and a hard place because their interest rates and u.s. interest rates are the same

level. so the negative thing to watch out for the next few months is that the chinese currency goes in for a large fall because of the fact that they need to ease policy so desperately to stabilize their economy. >> that's going to be a huge thing to watch as we get closer to g-20 and beyond that. a provocative piece, appreciate you sharing it on our air. talk to you soon >> ure, thanks and the nasdaq rallying this morning, up 2% at this hour, but wrapping up in october in which the index is on track to post its biggest monthly decline since 2008 here's a look at some of the october's laggards on the nasdaq 100. we'll show you some of the leaders after the break. "squawk alley" will be right back

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tech bertha coombs is at the nasdaq with some of october's biggest winners and losers bertha. >> if today's move holds up, it will be the first back-to-back gains for the nasdaq all month, pulling the nasdaq out of correction territory and some of the major indices out of correction as well, large tech communications are leading today's rally. that includes facebook and twitter and not surprisingly facebook, those strong earnings helping the stock see its best gain since april, cutting its losses for the month, making it one of the best faang names for october along with apple netflix is the best gainer today, yet that's still down about 17% for the month. t-mobile up on the halo effect from strong sprint results and shareholder approval of their $26 billion merger adp higher on an earnings beat amazon's gains today are really responsible for the most upside, about 40 points of upside on the nasdaq 100 when you look at it on a monthly

basis, it's the worst month since the financial crisis, responsible for 130 points of downside, although it has cut it down to about 20%. but amazon's losses are ten times the impact of the best gainer in the nasdaq 100 this month, which is tesla, seeing its best monthly gain in about five years elon musk among the buyers this week his trust buying about $10 million worth of shares. he's buying them at a premium compared to last month jon. >> all right, thank you, bertha. with that, "squawk alley" will be right back (humming a lullaby)

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facebook is up this morning after a beat on earnings although revenue and user growth fell a bit low of expectations julia boorstin has a closer look at the quarter hey, julia. >> carl, mark zuckerberg laying out challenges and transitions ahead for facebook he warned that growth may slow as it did while the company transitioned from desktop to mobile now it's working to move its ad business away from reliance on ads in facebook's news feed to ads in stories >> another challenge is that we're earlier in developing our

ads products for stories we don't make as much money from them as we do for feed ads we're following our normal playbook of building out the best consumer products first and focusing on succeeding there before ramping up ads. >> another transition facebook is chasing and working to build revenue around, the growth of messaging on whatsapp and its messenger app. plus there's the challenge that time spent watching video on facebook is less profitable. >> beyond the mission challenges of video displacing social interactions, there's also a business challenge, which is that video monetizes significantly less well per minute than people interacting in feeds so this means that even though we've made individuvideo more cy oriented, as video grows, it will still displace some other services where we probably make more money >> zuckerberg saying that 2019 will be a significant investment

yore as it ramps up safety and security as well then it says margins will increase again in 2020, which seems to be reassuring to investors and analysts shares are up nearly 4%. back over to you. >> thank you, julia. now let's get to contessa brewer for a news update. >> right now what's happening? secretary of defense jim mattis hosting a parade outside the pentagon following the event the two leaders went into the pentagon to hold meetings. a suicide bomber struck outside afghanistan's largest prison in kabul killing seven people the attacker targeted a bus carrying prison workers. the prison holds scores of taliban. heavy rain in northeastern italy flooded a river, caused the collapse of a bridge that bad weather has killed 11 people across the country over the past two days. thousands of homes are without power. it's said to be the tallest statue in the world. india's prime minister unveiling a towering bronze statue of the country's key independence

leader and its first home minister after british clone s colonialist. the statue cost $4 million let's get back to "squawk alley. >> that is a big statue. thank you. taking a look at faang all rebounding today so where does facebook and the rest of the stocks go from here? let's bring in larry glazer, who last month said don't expect faang stocks to keep carrying the rally. great to have you on the show today. thanks. >> my pleasure. >> whitney, i'll start with you. you're invested in google and facebook -- >> and amazon. >> and amazon. we've seen a rally in those shares today, yesterday. but in general they are taking it on the chin this past month why do you remain so bullish. >> your question supposes because they have taken it on the chin why would i remain

bullish. it's because they have that i'm more bullish i put my kids college accounts in those three stocksplus a bunch of berkshirehathaway and howard hughes. this was not a short-term call this was my buy and forget about it portfolio just yesterday i was talking to my parents they're making some decisions with their retirement portfolio and i'm putting them in the same five stocks. i think these tech stocks are long-term winners. the fact that they're down quite a bit makes it a more attractive entry point. >> there are antitrust concerns, digital tax proposals in places like the uk, china and trade headwinds, rising rates, none of those bother you >> all of them are factors to consider, but i think long-term they're winners. their valuations have actually come down to facebook and google net of cash, if you look one year out at earnings, they're trading at 20 times earnings amazon is a little harder.

you've got to look a few more years out to look at an earnings multiple there but these insanely great companies with a lot of growth left in them trading a little premium to the s&p 500 multiple for massively better quality businesses with massively more growth opportunity than the average company in the s&p 500 strikes me as pretty attractive long term. i make no near-term calls here >> okay. and, larry, last month you had actually said that you didn't expect that the outperformance we've seen on some of these faang stocks to continue given the correction we've seen on some of these shares in the past month. is this what you participated or do you think there's more pain from here? >> there's no doubt we're seeing a halloween rally and that is driven by investors embracing their fear they're looking past some of the spooky headlines, about a slowing economy in general i think that's a good thing. look, we came into october with too much of a sugar high,

pulling forward, too much good news now that's dissipated and gone out. what's really relevant is this idea of divergence where you could have one small segment of the economy doing so well. it turned out to be a fairy tale and the market is correcting that there's so much more to this economy than a handful of big tech names the s&p 500 which investors have been buying recently turned out not to be the s&p 500, it turned out to be a handful of tech names driving the market averages as the wind came out of there, it is overdue and in some cases it was overdone. in basketball terms, it's a jump ball the sugar high is gone and we can start to look for some opportunities because there are more treats than tricks through the end of the year for investors who can have a strong stomach. >> larry, are you putting all tech in the same basket, though? we call it tech, but apple's business is very different from amazon's business. >> no doubt, no doubt. >> from netflix's. do you think the sentiment has

gotten out of hand equally on all of those or might there be some so-called tech names that actually are acting more like value than some others >> sure. look, again, everybody is afraid of something, right? i think a little bit of fear is a good thing it prevent us from doing something really irrational, something irresponsible and something we'll regret later many of them were trading as a basket because of irresponsible indexing when you buy an index fund, you don't get a handbook or rule book that tells you what to worry about, how to use it unfortunately, investors have embraced it as a basket approach they shouldn't have. they should be doing more due diligence. they should be doing more stock specific research and looking at valuations, where are there opportunities. look, if you really, really, really want to get ugly with tech, worry about chinese tech a lot are going business in the united states and globally, but that stuff is so out of favor. so you can't generalize on tech. i think it is a company specific approach and hopefully towards the end of the year investors will realize that and they won't treat them as a basket because

they have individual qualities, different leadership, different cyclicality. >> it's going to be hard to unwind the wave of passive investing we've had. despite all the good things you're saying about going ogle d facebook, does that make trading harder >> the last ten years have been hard for value investors because we've been in a steadily rising bull market. i've been waiting for some turmoil, some opportunity to get into high-quality companies that are down 20%, 30%, sometimes more than 30%. so getting an opportunity on some super high-quality companies, that's what i do. buy high-quality businesses when there are short-term hiccups and short-term turmoil, when i'm convinced the long-term story is still intact. >> great to get both of your thoughts today. >> my pleasure well, we haven't had to hunt for the red in this october, at least not for tech stocks, with the market's five largest companies seeing dramatic declines in market value

dom chu is back at hq with a closer look. >> so you guys have been focusing so much on those faang stocks as we talk around the $2 trillion worth of losses that the s&p 500 has sustained on a month-to-date basis entering today's little rally trade, we wanted to take a look specifically at the largest companies in america for purposes of "squawk alley" we figured it would be appropriate to take a look at just the faang stocks, the ones that encompass technology, communication services and the discretionary side of things let's focus on how much market value they lost because we speak in percentage terms often. how much in shareholder wealth has been dissipated, at least through the month of october so far. take a look at this. amazon, no surprise there, being as large as they are, the declines that they have seen so far in october have driven $163 billion worth of shareholder value away from its market cap that's roughly the size of a

pepsico. alphabet, the parent company of google, $74, $75 billion of lost market cap since the record high on the 20th of september that's roughly the size of a morgan stanley or a cvs health or a walgreens facebook, $32 billion of market cap lost netflix around$26 billion. apple is the real standout here. amidst the market turmoil, it's only lost from a trillion dollar plus valuation, around $8 billion worth of market cap overall. so as we talk, jon, about some of the market values that have been destroyed, we speak oftentimes in percentages, but maybe some of the things that some investors are looking at, like whitney tillson and larry glazer, are the ideas here that maybe with this kind of a discount valuation there are some bargains to be had. we'll see if the market plays out that way in november and december, guys back over to you. >> that's a smart take thank you, dom chu. and coming up, why shares of gm are surging this morning, up about 7.5%

but first, rick stan tellantell are you watching today >> i look up at the board and interest rates have moved out of their slight funk to the upside. but the dollar index, no funk there. it's been moving higher for weeks. we're going to talk about how much higher it can go after the break.

i'm scott wapner he's what's coming up top of the hour on the "halftime report." stocks posting their best gain in two and a half years. does that mean the correction is over and we're primed for a late-year rally? we'll debate that. plus is general electric poised for a recharge after the stock's worst day ever we've made it our call of the day. both jon and peter will tell us which stocks are about to move because of unusual activity in the options market it's all coming up at noon we're about 15 minutes away. carl, i'll send it back to you. >> all right, scott, we'll see you in a few moments let's get to the santelli exchange and go to chicago hey, rick. >> hi, carl. you know, we had lacy hunt on earlier today and he talked about how the dollar index strength of late has really put some pressure on servicing debt globally and productively servicing debt the higher it goes, most likely that will add to what is a

divergent relationship between our economy and many of the other large economies on the globe. indeed, the dollar index settling roughly around 92 has had a good showing as we're speaking right now, it's actually close to unchanged, hovering right around 97 so i always like to take a big view, because big views kind of let you know in the macro kind of the major trend that you're dealing with, as many traders look at smaller term charts and like to hold their umbrellas and think they can move between the raindrops. now, let's go to the dollar index chart. this one basically a ten-year chart starting in 2008. what's interesting here is the big areas. 100, 90, 80, especially this move that we have here because i'm a big believer that when you get these very gappy moves where there's hardly any action and it's mostly just straight up, midpoints are very key it doesn't take a rocket scientist to see that there's been a lot of activity here.

but the fact that it's sort of held and it's moving up, well, it certainly seems as though most technicians think 100 is in the cards. does that mean it happens straighta w straightaway absolutely not it is biased to the upside you think that's a long view, let's go to the way back machine and start at 1980. i actually started in business about a year before 1980 and so i sort of remember much of this. you can clearly see from 120 levels how the dollar index has moved. really, forgetting this for a second, that is the one area we want to pay attention to, because there's some symmetry here, but the key is you see how going to 100 sort of disappears and becomes almost obvious when you take a long view that's actually quite important. it will give you the psychology. maybe you're not supposed to buy every rally or buy strength, but certainly if you see setbacks getting to 100 would be critical the scary thing about this chart

is most technicians believe that going to 100 might just be the beginning of a much larger move. jon fortt, back to you. >> rick, we do want to share with viewers the way in which you've gotten a head start on halloween. actually you and phil lebeau can we show this picture >> okay. >> the riddler as a slice of pizza. >> you guys are having way too much fun out there in chicago. >> i can't see the picture we do have fun at halloween in chicago, that's for sure >> very nice, phil >> i'm not sure that's a chicago style slice of pizza but it's a big slice of pizza. >> it's not. it's not a chicago style hey, look, rick is better than frank and i'll take him any day as the riddler >> i didn't have any good riddles. everybody was asking me to riddle this. riddle me where interest rates are going to go, but i took the

fifth amendment. >> then it's really halloween. >> fantastic moving on, one of the worst performers of the month has been amd, down more than 40%. the biggest laggard on the s&p however, the stock is still up more than 70% year to date, to put that into cop tentext. i spoke with lisa su yesterday about being a technologist who became a ceo and why security will play such an important role in the company's future. take a listen. >> in our case it has caused us to think very differently about security we have a responsibility to think much, much broader and there's a reputational aspect to our jobs, and security is one of though things. you've got to do everything you possibly can because it's such a reputational issue for the company. >> that was a great event and as you see, amd stock faring a bit

better today than it has year to date >> wow that's a tough month >> month to date, i should say done very well year to date. well, let's take a look at shares of another stock as well, gm coming off a big quarter saw it blow past forecasts in revenue what the ceo told cnbc this morning about what comes next. "squawk alley" is back in less than three real-time analytic, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. is my competitive edge. it senses our movements and automatically adjusts to keep us both

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shares of gm are up after the automaker posted a big beat on earnings. phil lebeau spoke with the cfo on "squawk." what a quarter, phil a heck of a quarter, carl. when you look at shares of general motors, let's point out this is a stock that's on its way, if everything continues the rest of today, its first profitable month or up month, i should say, store the stock since may. and what's driving it? north america. this is the engine for all of the profits or the vast majority of the profits for general motors and the change, look at this, average transaction price in the quarter up $800 per vehicle while the average incentive down $500 per vehicle you put that together and with a richer mix out there, the profit per vehicle up $605 in the quarter. here is the cfo of general motors talking about the strength in pricing. >> we're seeing continued demand

for our full-sized pickups is driving the pricing record you just talked about. we've seen no negative reception to that and we're going to continue executing our plan here and the launch cadence between our full-sized pickups and crossovers has certainly helped. >> take a look at shares of general motors, we should point out the company is announcing a buyout program for salaried workers. they are trying to continue to trim down those white collar workforce in terms of total number of workers there. no designated number how many people they're looking to buy out. >> phil, thank you for that. let's bring in morning star equity analyst talking about the quarter, david, and these average selling prices well above industry average where is elasticity for the consumer at gm

>> well, it's sort of a -- i hate to use the word stereotype, but americans love their big trucks, their big vehicles and it's true. light trucks, pickups, crossovers, suvs, minivans and gm's product cycle is well timed. the truck just launched in august you can use that for the escalade, chevy tahoe. for now at least there's quite a bit of pricing power interest rates aren't hurting demand yet >> china seems to be an emerging sore spot globally why have they been able to withstand that better than others >> that's a really important point. they're able to avoid the head winds because of mix and pricing. in particular cadillac cadillac is doing extremely well

in china i don't think they get enough credit for that. to your question, gm doesn't get enough credit they and volkswagen were really the first two western automakers to go into china and they're seeing the upside to that now >> are you near peak material cost inflation >> i think you have to ask the president that question the way he talks about aluminum tariffs. i'm hoping this year is the worst of the head winds and by the middle of next year it will at least be flat you never know with the way things are eventually we'll get to a more peaceful resolution. it may not happen in 2018. at that point the auto industry does better. i'm not too worried about that now. they seem to be doing a good job cutting costs and generating cash flow. the results today were all earnings there's no gimmicks in those numbers. >> david, to what degree does

gm's technology approach get any credit for this? the carmakers talk about the importance to the consumer experience did that play a role here? >> things like on star and all the work they're doing in avs are, i don't want to say, it's somewhat unique. all their work i don't think they get enough recognition for it over time it's going to be several hundred million dollars in incremental profit and what you can do once we have an av society or partial av society it's exciting. their marketplace initiative but also the partnership with amazon where you can get a package delivered into your vehicle without you being present. >> the world is changing quickly. david, appreciate it david, appreciate it a big day for gm o

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"the new york times" deal book conference some big interviews from google interview, gm ceo, snapchat ceo, peter teal all day tomorrow only here on cnbc >> and we can get ready for apple and starbucks and go pro and shake shack. let's get over to the judge. all right, i'm scott wapner. after the worst month for stocks in eight years is your money still prime for a run to the end of the year? it is noon stocks are rallying. this is "the halftime report." is the bottom in tom lee says yes we're debating his note that has wall street talking today. plus, the wild f.a.n.g. trade as facebook tries to rally the group. and the big, aggressive call on ge