>> pete? >> i'd agree you know what, i think you have to look the entire composite of what you're looking at, and not one single area. that's why i think jim's right i think they're going to crush it >> all right good stuff that does it for us. november is under way, and thus far it is a good one we're up 230 on the dow. "power" starts now >> see you soon, scott i'm melissa lee. good riddance, october hello, november. historically one of the best months of the year will it be a november to remember the five things that could decide where the markets go from here and it is the earnings everyone is waiting for apple reporting after the bell the three key metrics to watch for that could fuel the stock higher from here and the failing "new york times" actually on fire strong earnings, growing digital subscribers, and a stock that's ral l rallying today, up 50% this year alone. ceo mark thompson joins us first on cnbc. "power lunch" starts right now

and welcome to "power lunch. i'm contessa brewer. the dow rebounding after dipping earlier in the session all three up for a third straight day, something the s&p 500 hasn't done in well over a month. oil prices, though, sinking. crude taking a leg lower this hour materials and industrials the best performing sectors today. utilities and energy among the biggest laggards the mattress retailer missing estimates and cutting its outlook. hanes dropping on missed results. fitbit soaring, topping expectations >> well, the bulls getting off to a strong start for the month. if you're hoping to recover your big losses before october, this could be the month for it. bob is at the new york stock exchange with the staggering stats. let's look at the five key things investors need to watch for. hi, bob. >> hello, melissa. this is a seasonally strong

period of the year, thank evens, after what happened in october it's the second best performing month of year. we're up an average of 1.5% since 1950 more importantly, it's up 45 of the last 67 years. do the math on that. that's a pretty good odds that we'll be up in november. and also starts that best six months of year period from november through april when the market tends to outperform finally, the most important thing, midterm elections year, invariably the fourth quarter has been up since world war ii, 17 out of 17 times that's a great record overall. finally, you want to see what the market really cares about? just take a look at the action in the middle of the day here in the s&p 500. we had the ism services report come out a little disappointing the market was drifting out. suddenly, a little after 10:00, president trump tweets about a nice chat with president xi of china. market turns around. that clearly influenced the way our trading was going. not only did it influence our stock market, look what it did to chinese stocks. alibaba is going to be reporting

tomorrow alibaba was trading around, oh, 130 something, 138 i think it was. look at this straight up. that's almost a 10% move from the low to the high in alibaba that was on the president's tweet as well. again, alibaba reporting tomorrow finally, you saw what was going on with oil there, this breaking tech technical patterns we have oversupply issues. bolton was talking about giving waivers to india and south korea. look what it's doing to production stocks. this is one of the few poor performing areas energy another laggard, now going into november. back to you. >> bob, thank you for that what needs to happen for this to become a november to remember for stocks dominic chu with the five things you need to watch. >> so the first thing is the big jobs report coming out tomorrow. beyond just those headline numbers, we've been watching for trends in how much we make in our paychecks. average hourly earnings have been stubbornly stuck in this little range, but can we see a

little upside trend continue for average hourly earnings? the jobs report is going to be key to that november trade also what's going to come up here as well beyond just the jobs is what's going to happen with the earnings season so far. we've got 70% of companies reporting in the s&p 500 blended earnings growth, if everything goes as expected for the rest of earnings season, we could see growth of around 26% blended revenue growth rate is going to be around 8%. not too shabby in terms of market fundamentals. that's going to be one to watch. also what's going to happen with the midterm elections. what's a congressional change possibly mean for the dynamic for markets? right now according to the betting site predict it, dem house, gop senate is a likely scenario the odds there right around 67%, according to that betting website. gop house, gop senate right around a 32% odds. that's going to be one to watch as well. also, another one, you heard bob

mention it, president trump and president xi, that big meeting at the g20 at the end of this month will be huge one other place to watch is the market volatility picture overall. remember, we're elevated but not nearly like what we were back at the beginning part of this year. we're still right around 1920. that's the long-term average all of those will be drivers for the market in the month of november >> all right so dom, thank you for that will it be a november to remember for the bulls let's bring in joe quinlan and bruce bittles, who's the chief investment strategist at baird joe, i understand you're feeling bullish. is there anything that can stop this bull market from continuing to run you think this rally has legs. >> we do we think it has legs it can always be stopped by a more hawkish fed thank god october is over. everyone just talked about the good number there is, seasonality. good economy, good earnings,

share buy backs. we see more upside for this market, at least for the next two or three months. >> what do you think, bruce? do you think we've broken the downside momentum? >> well, i don't think we've broken the downside momentum typically that requires a day where -- or two days even where upside volume exceeds downside volume by a ratio of 10 to 1 or more we haven't had one of those days all year long. yet, we've had seven episodes where downside volume overwhelmed upside volume. the momentum is still to the downside, in our opinion with that said, seasonals are very strong going into year end. the market has a history of rallying post midterm elections. it wouldn't be too surprising if we mahad about a 50% retracemen, which would take us toward 2800 on the s&p 500 with that said, i think the environment certainly has changed. i think that's what the market

responded to in october. one, we had rising interest rates where they went up to levels we hadn't seen in several years. in some cases, now our competition for stocks two, the growth race of earnings, while they're exploding in the third quarter, i think the markets are looking to 2019 for perhaps a deceleration in earnings growth, and that would be a big, big deal >> and bruce's position defensively, utilities, consumer staples, and health care joe, i noticed in terms of the sectors you like, it looks like a growth theme here. automation, global health care, defense. >> yeah, we like that, melissa really, when you look outside the united states, look at the long-term trends, global is a huge issue automation, here in the united states we don't have any workers. our worker shortages so anything that helps companies substitute labor for capital is a winner >> are you worried about some of

the pmis we've gotten out of china as well as europe, that maybe the global growth is worse than what we're seeing here in the u.s. >> no doubt we're growing faster than the rest of the world, but i think the european union can chug along at 1% that's a lot of output china is slowing down, no doubt about that but this is already baked into the price. think of it that way we know this it's expected. i think we go into 2019 with lower expectations but more upside for a lot of these sectors that are out of favor right now. >> bruce, blackrock's larry fink says a full-fledged u.s./chan trade war could happen if things don't change within the next few weeks. how much weight are you giving the concerns over trade war? >> i'm not giving that too much weight i think that's a short-term problem. i think it's a negotiating situation on the part of the president. i think long-term if we can get a tariff agreement, which i think we will, that would be very bullish for the markets >> all right

thank you very much. well, as bob mentioned, the dow lost all of its big gains earlier in the day but jumped suddenly after president trump's tweet about china. the president tweeting, just had a long and very good conversation with president xi jinping of china we talked about many subjects with a heavy emphasis on trade those discussions are moving along nicely with meetings being scheduled at the g20 in argentina. some still remain concerned, though blackrock ceo larry fink spoke about his fears with our andrew ross sorkin in new york today. >> if the path remains the same in the next few weeks, we're going to have a full-fledged trade war. >> you think a -- what does that look like? >> the $200 billion tariffs the president proposed i think china is a very strong, very proud nation. i would have -- i think they're going to stand pretty firm i think privately, they will negotiate, but i don't believe it has worked for them at the moment look, we had similar problems

with our negotiations with mexico and canada. that was stalled and stalled and stalled until we came to a resolution let's hope i'm wrong let's hope that china and the u.s. come to an agreement. >> let's bring in jimmy. great to have you with us. moments ago, we understand, from chinese state media that the phone call was at the request of president trump. i'm not sure if that changes how you're thinking about this conversation this is what president soxi sai about the meeting. mutual benefit and win/win are the target and the two countries should strengthen contacts he's looking forward to meeting trump at the g20 where do you think the truth is? >> right if i was a deeply skeptical person, and i'm only a modestly skeptical person, i would say this is a stunt to juice up the market a few days before the

midterms the president has focused on the market in the past as a sign of success of his economic policies i'm still sort of confused if we were going to strike a deal with china that just involved them buying more soybeans or sorghum or something like that, we would have done that in the spring what it comes down to, does the president believe that the problem is just the bilateral trade deficit and we need to get a better deal and now we have china on their back heel, or to what extent does the president accept sort of the navarro theory that we're in a long twilight struggle with china for economic and technological supremacy? if it's the latter, then no deal. >> and there may not be a clear resolution it may be step by step, and this could last for a decade or so. it might not just be g20 in terms of how this thing escalates, let's say there isn't a clear resolution like that we're faced with potentially

another round of tariffs that will hit all the other imports from china then the tariffs that are already in place on imports of 10% will go up to 25% come january 1st. do you feel like that's a likely scenario at this point >> listen, i still do. i think this is different. the u.s./china trade relationship is different than nafta, which was really about getting a so-called better deal. i think this is really about us competing with china on the global stage, being a strategic competitor yet, it would not surprise me at all -- not only are there tariffs on the full amount of trade, but they're there for a long, long time. i think we better get used to them if the president bails on that and strikes a better bilateral trade deal, i think there's going to be a lot of negative feedback from congress where they really do view china as a

long-term military, political, ideological threat >> how much of what the president tweeted today plays into midterm elections and trying to give his base what they want? >> right well, listen, the president sold himself as a deal maker. so this would be opportunity one to make a big deal if people think the deal is going to mean china buying more agricultural products, energy, maybe some sort of superficial promise on tech transfer and ip, then it looks like the president has won. he's beaten the chinese, at least in the short term. it'll mean china buying more of our stuff. yeah, that would be a win, at least in the short term. i imagine particularly folks in the midwest like that. >> all right jimmy, good to see you thank you. >> you bet up next, we're counting down to apple's earnings. the trillion-dollar behemoth reporting in about three hours everything you need to know to

get ready. and we're joined by the ceo of "the new york times," his company a frequent target of the president. but does this look like the stock chart of a failing company? up 150% in two years since esentrp s ecd. we'll be right back.

the countdown is on to apple earnings after the bell, about three hours from now the stock holding up pretty well

in october selloff, down just 3% during the month, where we saw pretty big tech wreck there. josh lipton joins us with the three things we're watching for in apple's report. hi, josh >> reporter: here are some big themes to watch for when apple does report after the close. one, initial demand for the new xs and xs max. bulls betting they're going to be a hit, driving average selling prices higher from here. two, q-1 revenue guidance. that tells investors the level of confidence apple has in the xs and xs max, as well as indicates how that new xr is performing three, it won't just be about the hardware services, also in focus. the street expects that business to jump 20% in the quarter to more than $10 billion. another hot topic certainly today, mainland china. apple is a top five smartphone vendor in that country

how do chinese consumers feel about these new iphones? guys, back to you. >> thank you very much, josh so should investors bet on apple ahead of earnings? let's bring in the senior technology analyst at bernstein. great to speak with you. >> thanks, melissa >> seems like key to the quarter will be asps in terms of how that impacts margins as well as revenue. you're looking at, what, $813? so what kind are you thinking for the xs and xs max? >> so i think the story about apple is that we think average selling prices for the phone will be richer, both this quarter and for fiscal '19 we ultimately believe that will translate into higher rcevenues and higher earnings, both for this quarter and fiscal '19. the key metric is going to be what's the revenue guidance? that's the first quarter where all the new phones are available.

it really typically dictates the strength of a cycle. so if december is good, you typically see a pretty predictable fall-off from there. that's really the number investors are going to be focused on the consensus number is 93 billion for december quarter revenue guidance that's really the bogey and the most important metric. >> long term, apple bulls want to look to the services numbers, sort of the handoff for growth when it comes to hardware to services what are we looking for? the competitor on the street, bank of america, said they saw app downloads and revenue down quarter on quarter so it was up to 11% year on year growth in the month of october versus, what, 20% in september that could then impact services as sort of the fly wheel are you seeing any evidence there's a slowdown in app downloads and revenues >> well, you did have ten cent report their gaming revenues were off pretty substantially last quarter so i think that's a real

question going forward broader china is, but certainly we estimate that china gaming could be, you know, between 5 and 10, probably closer to 10% of all app store revenues. so when you have ten cent come out and say their growth rate declined substantially from the prior quarter, that's clearly an issue we're going to be looking at the bogey for tonight in terms of q-4 services growth is about 17% or 18% they have a tough compare because they had a big one-time gain last year when you adjust for that one-time gain, it's about a 27% growth rate. that's really 17 as reported, 27 is really the number people are looking for. >> you had a very interesting note in terms of the ad services business for apple being the next multibillion dollar business sort of like what we saw for amazon, signs of life in that business as apple tries to transition to that business for a bigger

catalyst for growth, will it be more exposed to this data privacy issue that it's been able to take a high-ground stand on when it comes to other people's shortfalls on data privacy? >> yeah, it's a great question i think apple is really trying to walk an appropriate balance between protecting consumer privacy, yet providing advertising. so the principle source of advertising today is on the app store, where let's say you're searching for, you know, a particular app and you type in restaurants, apple is really not using any profiled user data they're just using the fact that you typed in restaurants so it's trying to -- you know, it is preserving that privacy around not collecting any incremental data it's not saying you last looked for food or indian restaurants or whatnot it's just responding to the keyword that you're putting in so the trick for apple in building this business -- and amazon does this to a certain degree as well -- you type in a search query for a product and

it responds with advertisements to that. so the trick for apple will be really to be transparent in how it's providing that advertising and underscoring it's doing so without collecting the kinds of information that it has accused, quite frankly, its f.a.n.g. competitors of doing >> tony, we're going to leave it there. thank you so much for your time. >> thanks for having me. google employees across the world walking off the job today in protest we're live at the main campus in mountain view, california. what have you seen >> reporter: hi there. that's right in less than an hour, we expect workers to come out those doors here at google headquarters in mountain view in protest of the company's handling of sexual misconduct claims. lkt images worldwide of this waouare pouring in from asia and europe and europe we'll bring themment advisor.

as fiduciaries, they live by a simple rule: couple minutes visit findyourindependentadvisor.com

in a little less than an hour, many employees at google's main campus will walk off the job, protesting the company's handling of sexual misconduct claims we're live in mountain view, california >> reporter: lye there, contessa in just less than an hour, we expect a flood of people to walk through those doors here at google's headquarters, but we've already been seeing some very powerful images throughout the world. the last one happened in new york take a look at some of these pictures hundreds, several hundred, actually, pouring through the doors of google headquarters in

new york, in chelsea, actually they gathered, marching to hudson river park, chanting "time's up." we saw workers at the company's d.c. office also walking out, as well as those in chicago they're documenting the day through the #googlewalkout on twitter. overnight, we have seen images of the walkouts in singapore, tokyo, berlin, dublin, zurich, and london globally, google has close to 95,000 employees all of this, of course, prompted by last week's bombshell report in the "new york times," which revealed that android creator andy rubin was given a $90 million exit package in response to a credible sexual harassment claim. the company then acknowledging that in the last two years, 48 people have been terminated for sexual misconduct, including 13 who were senior managers and above. we sundar pichai is supportive of the walkout

we'll hear from him firsthand. we'll be back here again at 11:10 local time as we expect to see hundreds if not more than a thousand people walk out those doors. >> all right thanks it's been nearly two years since the election of donald trump. since that time, the quote, failing "new york times," has been one of his favorite punching bags. but it isn't all that bad. the stock is up 15 sce0%in that time is being a targts of tet of the president good for business? we'll talk to the ceo.

hello, everybody i'm sue herrera. here's your cnbc news update for this hour. wisconsin's governor scott walker getting a helping hand on the campaign trail from house speaker paul ryan, who called walker the best governor in that

state's history. >> scott walker looked at wisconsin's problems, and he said to wisconsinites, here's an agenda to fix these problems if i get elected, i will do this well, he did just that that's what's great about our governor he said he would do what was needed to do to fix our problems, and he fixed it. a final government report shows radio frequency radiation may cause cancer in rats, but there is no evidence that cell phones cause cancer in people. researchers say the exposure in rats was higher an longer than what people experience when using their phones and starbucks unveiling its cups and beverages for the holiday season and will begin selling them tomorrow. that's a week to ten days earlier than in past years and the new offerings include peppermint mocha and toasted white chocolate mocha, among others it'll also sell a reusable red cup. and i heard the first christmas music on the radio this morning. it's too early that's the news update this hour melissa, back to you

>> i feel like you got to give thanksgiving a chance. it's really unfair to the thanksgiving lovers out there. >> i'm one of them >> me too. sue, thank you let's get a check on the markets. stocks are rallying once again the three major averages are up for a third straight day, session highs for the s&p and nasdaq both are on pace for the biggest weekly percentage gain in almost eight months the dow is upby 0.9%, 218 points it is on track for its best we can since early june boeing, home depot, dow, dupont are fueling the index's gains. look at opiniil prices, they're taking a hit, down by more than 2% right now big day at "the new york times" deal book conference. cnbc is the official broadcast partner, so we'll bring you the big news from the big names. lachlan murdoch speaking a short time ago julia boorstin has the details >> that's right. explaining his family's decision to sell fox to disney, saying it's because of the challenges on the horizon for the industry, saying fox's assets could be stronger and more viable

now lachlan murdoch is focused on new fox, which he'll be chairman and ceo he said they're open to acquisitions of regional sport networks, which are part of the sale to disney, as they build out new fox's business >> it's an american company. it doesn't have any international businesses, at least to start from day one, it's very strong in live news and live sport. last week during the major league baseball world series, but also in a heavy news cycle, we had 50% of the audience in prime time, the live audience. we have four nights a week on our network. we still have to program with entertainment. we'll still be investing aggressively in entertainment programming. >> when asked, he was interested in rehiring former fox anchor megyn kelly. just last week her show was canceled by nbc. murdoch said while he looks

megyn kelly a lot, he's happy with his current lineup and has no plans to hire her back. >> julia, thank you very much. let's stick with media shares of "the new york times. sharply higher and on pace for their best day since early february on strong third quarter earnings they added 203,000 new digital only subscriptions in the quarter. total revenue grew 8% from the same quarter last year and digital ad revenue grew 17%. since president trump was elected, shares have jumped 150% has the president's relentless bashing of "the times" and other media companies been a good thing for the bottom line? here first on cnbc, mark thompson, the ceo of "the new york times." he joins us today from "the new york times" deal book conference in new york city mr. thompson, good to have you on nice to see you today. >> yeah, good afternoon. >> donald trump the best thing to happen to your paper? >> well, what i'm pleased about with this quarter's results, i think the trump bump, that initial surge after the

election, is actually largely over what you're seeing today is what growth looks like. yes, we've got a good news cycle, but also we're getting our marketing right. we're launching new products they're doing well we're pouring money into journalism we're investing more in investigative journalism in great new features and improving business journalism. i think, although, of course politics in the news cycle is part of the story, it's a bigger story than that. it shows we can sustain it long after the whole trump phenomenon comes to an end. >> sure, but can you quantify in any way, and have you tried by study or otherwise to know what mr. trump has meant to the number of subscribers you've added? as we said in the intro, his seemingly relentless bashing of your news organization >> well, i mean, quite apart from the free publicity and

marketing boost that the president continues to deliver through twitter, we know that in the last quarter of 2016 and the first quarter of 2017, we probably got, you know, 400,000, maybe a little more of additional subscribers than we'd expect because of intense interest and indeed anxiety about the election but that really petered out by, i would say, the spring of 2017. what you're seeing now is something, i hope, is close to business as usual. we have a model delivering strong digital subscription growth but also very encouraging digital advertising growth our digital advertising, as your chart showed, grew 17% year of year in the quarter. what we hope is we've got a sustainable model for rapidly growing out a digital business out of journalism, which is growing much quicker than our print business is declining. >> speaking of delivering, how

far away are we from you no longer delivering a paper at all and going full digital >> the great thing, scott, is our print newspaper, our print platform, if you like, is still a wonderful platform and will be for many, many years i believe that we've got more than, maybe a lot more than another decade of positive cash flow out of our print platform so we've got a good long runway to build a digital business. i believe it's likely that eventually our print platform will no longer be cash generative and we'll stop printing it's possible it will plateau, but i believe that even if it does ultimately prove no longer economic, that will be so far in the future that by then, "the new york times" will have an enormous and still growing global digital business. >> digital subscribers were up 24%.

i'm wondering how many print subscriptions do you sell standalone, or are many of the print subscriptions delivered today packaged up, bundled with a digital subscription >> sure. >> i'm wondering how strong the demand is for the print only >> it's really interesting so we don't sell any print-only subscriptions, really. if you buy a copy of "the times" on the newsstand, i guess that's print only but every print subscription comes with digital access. the overwhelming majority of print users actually use their digital access i would say -- we announced today we have 4 million total subscriptions. my estimate would be of that 4 million, probably only 200,000 subscribers, maybe even less, are print only so the overwhelming majority of our subscribers are using our digital assets some of them love to have the convenience and pleasure of a physical copy of "the times" as well >> what made the difference for you in getting people to subscribe digitally?

was it just changing their kp s expectations about that pay wall >> honestly, i believe the single most important thing is the work that my colleagues in our newsroom and editorial department do. moments in the last quarter like the coverage of the kavanaugh hearings, like the article by anonymous, the op-ed piece about life inside the trump white house, we can see it in our numbers, those having a big, big impact on the daily numbers of people who want to subscribe journalism first that's why we're spending more money. we have more journalists now than we had five years ago, ten years ago. so invest in journalism, but of course try and get the product right. try and really figure out how to make serious journalism work on a smartphone then the whole customer journey. as i said in our earnings call, we're continuing to experiment with how do you price the products or the range of products how do you think about introductory offers? how do you encourage people to register and to go down the

funnel towards becoming a subscriber how do you retain people how do you think about taking different products like news and also crosswords and cooking and other new products we're still developing and bundle them into more valuable, more cash generative bundles so we're trying to optimize all the way through, but very much with a thesis that what matters most -- you know, what matters most is simply the quality of the journalism the old bill clinton point, it's the economy, stupid. for us, it's the quality, it's the distinctiveness, it's the specialness of our journalistic offer that matters most. >> are you worried in this environment -- i mean, we've seen the killing of jamal khasho zbr khasho -- khashoggi. are you concerned about the quality of journalism losing its luster among the american people >> i think you raise two questions. one, do we worry about the safety of everyone who works for

"the times," and in particular do we worry about our journalists' safety? i chair the committee on safety and security at the top of the organization in many ways, it's our biggest single priority. this board is to make sure in every way we can, we make the business of what "the times" does, which is finding out what's going on in the world, make that as safe as it possibly can be i'm confident that we can really do a lot to ensure the safety of our people i want to say, though, that i think what we're seeing -- and you can see it in our numbers -- that public demand and public support for high-quality journalism, certainly from this news organization, is very strong and growing i think it's also growing around the world. we live in a world which is very frightening and hard to understand i think in every country in the world, we have readers in every single country recognized by the u.n. there are readers who really want to understand what's happening, and they want to

support independent weithout fea or favor journalism. >> it doesn't bother you, though -- there was a poll out within the last 12 hours that said, you know, some 28% of the public blames the media for the divisiveness we've seen in this country. more may blame donald trump, according to this one particular poll that's a high number though. >> we're living in an incredibly polarized, very controversial time with so much mud flying around, of course i understand why people are looking for someone to blame, someone to pin the blame on what i want to say is we're just trying to do our jobs as journalists and editors and marketers and all the rest of it, which is we've launched a campaign called the truth is worth it with tv spots this week the heart of that campaign is the idea that serious journalism takes time, takes conviction, it takes money actually, but it's worth it if you want to understand what's happening to your world >> yeah, mark, it's good to talk to you today thanks for being with us

>> thank you, guys >> mark thompson, krerceo of "t new york times." let's get to the bond market rick santelli tracking the action >> good morning. or good afternoon, i should say. the treasuries have been really firm not so much today. look at intraday 30. we extended, almost reached 3.43 look at one week of 30 year. it still looks pretty lofty. it has been the solid performinger performer. if you open up to the beginning of october, it really jumps out at you, how firm it's been why is it weakening a bit today? look at the dollar index look at a two day. it's down down 7/8 cents let's get to the punch line. maybe both these markets are down because tomorrow we have the big employment report. it has fed implications, whether it's wages, hours worked, all of that plays in. so we'll continue to monitor, but at this point, the dollar

index may be holding 96, but it certainly is getting there darn quick. >> rick santelli, thank you. it has been a wild three months for tesla's stock it soared after the funding secure tweet, sunk as the s.e.c. investigated you may look what elon musk is working ron right now. we'll tell you about summon mode when "power lunch" returns

time now for the power rundown. a trio of auto topics. we want to start off with october auto sales phil, how were they? >> it's a strong month the sales rate is going to be

somewhere around 17.3, 17.4 million. any time you have a sales rate over 17 million, it'll be strong even though you see the individual automakers, whether it's fiat-chrysler up 15% or toyota up 1.4%, ford down 3.9%, we're comparing with a strong october last year. overall, strong auto sales in october. what's interesting, when you look at people in showrooms, they are now taking out auto loans with the highest interest rate we've seen since 2009 on average, 6.2%, according to edmonds. take a look at shares of toyota. they will be reporting earnings next week. those higher interest rates, guys, they are not keeping people away from taking out loans on more expensive vehicles >> i didn't know 6.2%. that's high, phil. gm ceo mary barra speaking off the heels of a strong earnings report and a huge surge in the stock yesterday. what did she say >> one of the big topics andrew was talking with mary barra about is monetizing its

subsidia subsidiary cruise. they plan to have an autonomous ride share service they'd like to launch next year. andrew said, when do you start making money off of cruise here's what mary barra had to say. >> you don't have anything to monetize until you actually have the technology that's capable that you can deploy and take the driver out of the vehicle. so once we accomplish that, and we think there's multiple business models of how we'll deploy, then we'll look at what's in the best interest of the general motors shareholder on how to monetize >> coming off of 3q earnings better than expected yesterday, we saw gm's stock pop yesterday. it's given back a little bit today. it's generally holding on to the gains that it got yesterday. guys, this is the best week since june for general motors. >> lastly, another tweet from elon musk. uh-oh, but this one is about the company's auto park feature. >> and summon. if you were somebody who thinks, boy, i want to have my car do things that i never dreamed it

would be able to do before they already have this summon feature on the vehicles. elon musk sends out a tweet saying for those unfamiliar, this uses tesla auto park/summon, slightly smarter version, hopefully ready soon. by next year a tesla should be able to drive around a parking lot, find an empty spot, read signs to confirm it's valid, and park look, that sounds great. and the technology, look, i think the technology is coming along. that's not the issue the question is, when do we actually see this technology becoming a reality melissa, back in 2014, elon musk said we're going to have auto pilot and we'll do a drive from seattle to california. they never did that drive. 2017, they were going to drive hands free from new york to california or cross country. that never happened. look, this technology will be developed. i think that people need to tone down their expectation that right around the corner they're going to be able to park their car, you know, and move around remote control on their car without being in the car

>> all right phil, thank you. merck ceo speaking in new york he spoke moments ago about health care costs and drug prices >> we have a problem in this country with respect to health care and how much it health care and how much it costs before i get down to the drug price problem, let's recognize that we spend about 18% of our gdp on health care there was a health affairs article recently that said a trillion dollars of that is wasted a trillion dollars just to put that in context, that's twice as much as it takes to run all of medicaid it's more than we spend in america on education so let's start with the fact that health care is expensive. now, few want to talk about drug pricing. the fact of the matter is if you look at the part b, the where they want to index prices, it has grown over the past few years. a lot of new important medicines have been brought to the

marketplace. as far as drug transparency, i would argue one of the challenges the industry has is it's the only part of health care where the prices are transparent. everything else is pretty much opaque. >> when i go to the doctor he writes or she writes the script i go to dwayne read or cvs, i don't know until it goes up to the cash register what i'm going to pay. >> that's what i'm saying the list out my door is the only transparent thing in the whole system i'm making exactly your point. >> it's not transparent to me. >> no, no, no, i tried to make a distinction between the supply chain. you mentioned dwayne reed. i don't own dwayne reed. there's lots of people out my back door and the consumers. thing a gre ga/* aggregate dischounts is 50%, 50% is the aggregate net discounts i'm

paying across my portfolio you are talking about, where does that money go >> yep >> we have to have a rational conversation about the supply chain. how much should be kept by pbms, how much should be kept by pharmacies how much should be kept by insurers by the way, how much you pay is largely a function of how your insurance is set up. so this is a complicated issue i jut want to say, the first thing i want to say -- >> we have been listening to merck ceo interviewed by andrew ross sorkin talking about drug pricing saying the only transparency in the whole system is the price merck sells that drug at. after that, you don't know how much each part of the supply chain will be paid i think that's a really good points you go to as andrea mentioned cvk or caremark, the price could be different consumers don't know that's a big part of the problem. casino stocks are getting a big boost benefiting from news

that gambling revenue rose 2.6% in october that was more than expected. at wynn los vegas, sands on pace here for their best dates since february 2016. so what does this mean for the gaming space going forward let's bring in david katz. he covers the casino stocks. good to see you today. i'm looking at wynn. it's up 12.5% on the day as all of the u.s.-listed exposure tell me why 2.6% is a great gaming deal in macaw? >> we have to take today's number as you pointed out in expectations also in expectations of the casino stocks and wynn have done over the past 45 days. you know, they have been down well in excess of where the market is. so i think they're taking back some of the losses that they've given up over the past 30 days they have been trading below ten

times eb that. i can't recall them trading at that kind of level since 2008 and 2009 and that clearly was overdone, i don't have sold, so they're taking some of that back >> okay. if you take wynn, for instance, you have a price target on wynn of $170 bucks. it's been hovering around the $100 mark or so about a week or more what do you think is going to drive that upside? >> well, look, i think we've set that price target after their most recent second quarter earnings as we did all of our other price targets. and if you looked across all of the price targets that we have, they are way above water and so everything looks like they're streaming by as i look across casinos, particularly those domestic, but macaw as well, they all look attractive for a trachltd when we put it in the context of the longer term fundamentals and when the market settles in, i think that will lead to

differenciatie which is not thes now. everything looks cheap >> china just opened a new bridge from hong kong to macaw it cuts by about you know something like 75% the commute that it would normally take someone to drive there what's that going to mean the these mass market gamblers who have been the driver of gaining revenue growth in macaw? >> it is a positive and i would only suggest that the mass market is the long-term future of macaw because of their driving the profit growth in macaw when we talk about top line ggr growth, that's really much more of a vip issue we're looking at china and macaw, in plarks is a very complicated place. we have a china macro. we have concessions that are expiring for each of the operators over the 92nd two or three years, which poses a big risk so we're at an important moment to define what's going on in that market and how much

macro will drive it. in fact, jeffreys is hosting a conference next week i'm sure some of my colleagues will have interesting data po i want to talk about what's going on in that mark. >> i want to talk about casinos we don't talk about. penn, it acquired pinnacle it has 40 nationwide eldorado and churchill downs are the only ones positive for the year and you have been a big proponent of both? >> we have we have had a neutral rating on churchill downs. i would say a category, which includes else ra da, includes penn, is domestic regional gauge has proven itself over a very long time, including through the down turn as a plus or minus 2 or 3% market so we consider it to be a very safe top-line business and what's more attractive is, there is a revolution going on for cutting expenditures and profit growth and that's

happening across the group with eldorado as a leader, with penn as a leader and churchill downs has executed xtremely well >> thank you very much. coming up, we will get you ready for the big earnings report after the bell. apple and starbucks are both on deck. plus, are high interest rates turning house flipping into house flopping? can you still make a quick buck by fixing up a fixer upper and google employees walking out of the job for now we will take you there live on the second hour of "power.

i'm melissa lee. here's what's on the menu. stocks putting october in their rear view mirror putting wall street in the back plus, apple on the clock, we're just a couple hours away from its earnings report the stock is up close to 8%, since their last report is this a make or break report for the markets? and flipping flop. are rising rates and not enough workers quashing the dreams of many would be fixer-uppers the second hour of "power lunch"

starts right now. welcome to "power lunch. i'm contessa brewer. stocks are rallying. the subpoena subpoena near session highs. president trump's tweet on china and trade helping to fuel those gains. major averages up a third straight day here's something the s&p 500 hasn't done since late september. the dow on track for its best week nasdaq on pace for their biggest weekly percentage gains in almost eight months. materials fueled by dow, dupont, industrials and consumer directionary among the leaders as well. scott. >> contessa, thank you very much i'm scott walker here's what we're watching this hour the three big on the earnings front key things investors will be focused on then it's the countdown to the october jobs report. >> that report is out tomorrow morning. hard to believe we're getting a jobs report. >> already

that's exactly where we begin, the expectation for 188,000 project for november steve leishman is all geared up. >> you have an economic report on the horizon >> you are a lucky man, steve. >> don't forget fed meetings that's like. >> think of how much -- >> 20 christmass a year for me anyway, we can move on i do want to point out one thing, tomorrow's jobs reports will be watched closely by the fed. wages rising, you saw that on eci yesterday, if we raise the gdp, we need more workers. economists say we need as many as 1 million new workers every year just to add a half point percentage point to potential growth here's the math. we have 162 million people in the work force now the average labor force is up a little more than normal. we're due in '07 if you want to add a point, you

need 800 million on top of the million we're already getting. so conrad writes, it will be difficult to get the higher participation rates because of the aging population where are you going to find an extra million workers? we can get more of the people in that prime age only goes so far we can focus particularly on women. alan krueger labor expert from princeton tells me we are lagging behind canada, europe and japan in participation of women. to get retirees back to work, you have to increase immigration. not holding my breath on that one. we can do further declines in the unemployment rate. the question for the fed how low will they let the unemployment rate go before they feel they have to slam the brakes on the economy? that means if you want to grow to 3%, you need a whole lot of workers from somewheres else, guys we don't know where they are

coming from. some people say we will go down to 3% unemployment rate. i think that will freak the fed out. >> we will get the wage number too. we have been talking trade the last couple of days. tomorrow the feds will be front and center yet again in the markets conversation >> you want to see snit. >> it was a wage number that freaked the market out not too long ago >> the market cooled then it cooled a bit and got, calmed everything down >> what we need to hear from the fed is, two things one is how far is too far in the unemployment rate in the other is how far is too high when it comes to wages yellen had said in the past that you can grow 3-to-4% on wages and not be there how do you get there anything more than that it will be considered inflationary. bob pisani is tracking the exchange >> the important thing 3-to-1 declining stocks, it's been that

early in the day let's look at the s&p 500. we were drifting lower after the services came out and a chat he had with president xi with china. the markets definitely listed on that we have been essentially sideways ever sivenls here's what's important, too, they've not just lived our stocks. look at the ali baba charts. it moves 10% 138 to 151 you do the math, it's a remarkable move. remember, ali baba reporting tomorrow the most beaten up sectors in october are doing better today materials, semi conductors and zrims had a horrible month they're up nicely. look at that energy, doing nothing. oil, lowest level since april production stock russian fought participating in this rally at all. finally, thing are slowing down. it's the vix curve, where you look at the front month of vix

contracts against the vix cash look at that 19 on the vix it hasn't been there in a long time you see the other futures contracts around 19. this is a flat curve for the vix. that was 28 that one on the top there. just about a week ray go and, of course, that signified traders were freaked out about the short term now you see things calming down. vix below 20, that's a very good sign >> thank you very much stocks may be bouncing back the major averages had an october to forget the dow seeing its worst month since 2016 the s&p since 2011, nasdaq since 2008 so what is next for november let's bring in liz young, the senior investment strategy at bmy mellon, an leddy at wells fargo asset mangment is this legit? >> i think we are.

it's given investors an opportunity to get back in and pick stocks that are trading at discounts to where they should be >> are you not a believer, liz >> i'd have to disagree little with that. i don't think we trust these short-term rallies i think the market is in transition it's getting ready for next year lower growth, lower gdp growth i think this will take a while to work out. >> that implies multiple strs to come down. >> it doesn't imply multiple versus to come down. only in places where there is excess buildup >> such as >> we had nine.5 years of quantitative easing and the markets have been there to rescue us when things went wrong. now that's all coming off the table. in the places where things are a little excessive, i think once the volatility comes down, we are selling the rally and tech and buying a different value >> what about that they're all different points >> the last time i was on this show, actually october 2nd i

believe it was, one of the things that i talked about was the gap in the valuation differences between growth and value and how wide that had gotten certainly growth has beaten value over the last decade, but the gap widened significantly over the last year and we believe that that was going to close a little bit, there was too much crowding in some of the technology names and some of the momentum growth names and the sell-off really impacted those names more significantly than the rest of the market and so we're starting to see other areas of the market be paid attention to more that's good for active managers as well like myself. i think that's why i'm optimistic i do think in the short term we're due for a rally. so i'm optimistic in the short term we have seen multiple compression and that makes me a little more optimistic about how we're set up for 2019 as well. >> biggest issue right now facing the market is that the fed is staying the course so to speak or is it trade tariffs in.

>> yes tariffs. >> i should have given controversy, automat all te awo. >> what the market wants to see is some flexibility and they will watch the market not just the data if that happens, that would be great. >> that would be a bull market personally, i don't think that will happen this year. trade is that overhanging risk >> when you say watch the mark what do you mean >> they continue to raise rates. we know economic data is telling them that. if it puts undue pressure on the marks, everybody wants to see them hang on a minute and wait this out if that happens, that's a bullish day for the market >> have we seen the markets react in that way, that you think the feds should back off in >> i don't think it's happened this time. >> oh, it has to get a lot uglier than in okay which was nasty. >> right >> if are you so positive in where we're going in the near

term, you have been a buyer then on the dip we've seen? >> i am. i do like certain areas of the market that have been ignored even in the latest three-day rally that we've had some of the names in the energy space i do like. so contro is a good example of the name in the energy space it's -- concho but since the acquisition of rsp, they now can enhance returns to shareholders through free cash flow and generate better returns and so i think that is a name that's trading at a discount to where it should be and is set up well to perform well for the next 12 months. and a name that really is on the growth side that i think has been overly corrected in this growth momentum decline is google and it's a name that is trading less than 13 times adjusted cash flow as we go up to '19 and for its collection of assets and its dominance in mobile, we think

that's too cheap for a company such as google. >> it's a name on a lot of shopping lists i've heard of, for schuure. thank you very much. speaking of google, google employees are staging a walkout over the company's handling of sexual misconduct. addy diis -- adidi is live with the very latest. >> reporter: hi there. >> we're obviously having problems with her camera we'll try to get her back. coming up, starbucks has had a sluggish year. will the china slow down slow the tech down even more? apple has faired out better than the rest. will that trend continue or will china put a daemp on earnings? if you are looking at flipping a house now may not be the time to do

it particularly if you live in southern california. don't go anywhere. "power lunch" is back in two minutes. i am a family man.

i am a techie dad. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools 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. management google headquarters mountain view, california, monitoring the global walkout adidi.

r. >> reporter: i will step out of the way. we seen hundreds walking towards the central courtyard area what is noticeable is it's so quiet. there are no signs like we saw in the new york version in new york we saw people carrying science like unfair workplaces create unfair platforms we know in that central area hopefully, we have have an aerial view so you can have a sense of the hugeness of this crowd. they have speakers set up. so we expect a number of people speaking employees are asking for a number of things, for an end of forced arbitration, pay equity and a clear process to report claims anonymously as well as more transparency around issues at the country we have seen similar walkouts local time 11:10 a.m., new york, d.c., chicago. overnight we saw walkouts world wide as well in singapore, tokyo, berlin, dublin, zurich

and london a fair share of google's 95,000 employees world wide all of this prompted by the "new york times" article that was week revealing sexual misconduct claims at the company and the company then revealing over the last couple years, 48 people have been terminated for sexual misconduct, including 13 who were senior managers and above again, they have expressed support for this walkout the pictures here are pretty powerful you can see in the crowd, men and women, young and old, marching two ready this courtyard area, where they will no doubt expect to have a rally and speakers there talking about these issues as well, guys, back to you >> aditi roy thank you very much. starbucks is out with earnings after the bell. kate rogers is here, there is

sundayar pichai, he, of course, is the google ceo. will you see that as we are the exclusive broadcast partner. now kate rogers on starbucks sorry about that >> analysts will be looking out for a few key things after the bell one any updates on guidance and same store performance in the u.s. they say costs next year will be likely in the range of 3-to-5% globally lower guidance this year had a big impact same store sales are important as the company accelerates its domestic growth. develop and livery, starbucks is opening a new store every 15 hours in china and says one day that market could surpass in the occupation, partnership with ali baba and number three, ackman's starbucks, took a $900 million stake last month

as ceo 87 johnson continues to streamline and any further structure will be key. i also brought along their release. today the beverages will be available tomorrow >> empty, i might add. empty. >> i didn't have time to run to the store. >> it's what we wanted you didn't want to take our order. >> also, a reusable cup. nice retrodesigns. >> you actually have to drink it then and there >> yes >> yeah. >> next time i'll bring the coffee >> cut the - >> kay thank you kay rogers. after a solid quarter after starbucks keeps the buzz going, let's bring in any coal jefferies. great to have with you us. >> good afternoon. >> is starbucks going to break the trend in below historic same sale comps in the u.s. >> i think we will get a bull

marketp off last year's quarter -- a bump off last year's quarter. to your point on a trend, i don't know that this one quarter will set that trend, so i think for the stock to get real upward momentum, we will have to see more consistency in quarters to come >> is there any chance that we'll ever see a split between the u.s. and the chinese business right? one's mature, one's where they are pinning all the growth on? does it make sense to do that? >> at some point it will i think the china number will be interesting if you look at the retailers that reported so far china has been okay. i don't think we had too much concern there. if the number is concerning on the print, i think we should take a look at that remember, they've accelerated development in china. there is a little cannibalization that can fall into that number we may have to dig a little into china tonight. >> how does starbucks get the

consume tore go back in the afternoons that's their problem they don't sell as strongly in the afternoons as the morning, so they're missing out on the whole they part? >> right, we heard duncan earlier talk about the afternoon day part getting better. i think that's a very fascinating point. it's really reengagement but this is the starbucks dna. they have a leg out. they have scale and they really need to engage the customer and that doesn't mean just digitally, but really with that emotional third place connection that they've always done somehow that got a little bit lost, though, on the way in this digital revolution >> yeah, i was going to ask you, how would you characterize execution from the ceo level >> credibility i think that they have - >> has there been a lack thereof? is that what you mean? >> i this i that i have an opportunity to gain that back, to earn that back. and i think you know what the

print is, that's -- that matters partially, but how they guide in the opportunity to be a little bit more conservative in that manner and beat those numbers and achieve them, i think that will allow them to earn back that credibility i think that will be very important for the stock going forward. >> because you are speaking really to what was the issues not that long ago, it was the guidance versus the result that seemed to call the credibility, excuse me, into question >> right and they've had some turnover. i mean, these things happen naturally. howard schultz is out. with that, there is a regime change all of these things are natural and normal, but they are disruptive i think it will be very important to meet the new ceo to understand how they want to guide going forward and to see what the main drives are frs arr the nestle's alliance has been

great. when that u.s. comp does turn, you can see a rerating to businesses that aren't as capital intensive. >> all right guys, thank you so much talking to you thank you, nicole miller reagan. that was smooth. >> we will stick around. coming up, semi stocks are soaring. the group on pace for the best week in over two years should you get in now? trading nation is next

that was smooth. obvious. sometimes, they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group - how the world advances. ♪

take a look now the crowds are gathering as google employees all over the world stage a walkout over how the company is handling sexual harassments in the workplace you are looking at a live shot of headquarters at google in mountain view, california. they are pouring out there in the courtyard. >> look, they are demanding more of their company when it comes to claims of sexual harassment this is something we have seen unfolding over the #metoo movement the "new york times" had a big expose, when they say their top executive got paid $90

million after a credible claim he denied that this is a big turnout for the walkout. >> yes, they are looking for the interview with the ceo sundar pichai he will be interviewed today on the "closing bell. going after the review process, mech terrell is here. >> that's right. they are up for a panel, alkermes will have them approve based on the safety and efficacy now, it's been a large market for the drug industry. more than 19 million of people in the u.s. have depression. those are drugs in the market already, they don't work for every patient. alkermes offers a new approach the fact na opioids are involved brings additional safety questions. the fda has a question about the strength of the clinical trial

data it laid out on tuesday causing the stock to sink that day thing to is halted until the panel votes this afternoon of course, we will bring that news when it comes the fda doesn't have to follow the committee's recommendation, of course, it almost always does they will meet tomorrow from sage therapy putics for postpartum depression. >> for so long there was so little research here do you get the sense that if there is anything opioid-related is going to be a problem for them in terms of marking and brand image, too >> it could be potentially everybody knows how big the opioid problem is. just the safety involved with that could there be abecause potential? >> right >> the fact is this applies a scientific approach to depression, which people say is desperately needed >> thank you let's go to mike santoli for "trading nation. >> contessa, thank you very much today on "trading nation," we're

looking at terror stocks, micron, invidia, all up huge recently the smh etf trades the best in weeks. some of the hardest hit amid the recent tech sell-off do you sell here is this a buying opportunity stacy, how would youview this? either as a sector of based trade or perhaps looking within some of the beaten up components of it? >> yeah, mike. i think you hit the nail on the head there this is certainly not a sector-based trade our analysts are still certainly cautious on this sector and we certainly wouldn't be looking to buy the basket here if you will. it's actually consistent with what we're seeing in terms of marketing positioning. if you look at the semi conducter, smh, it has a more cautious tone. >> that being said, there are names where we think you can dip your toe in. we think they can be attractive. many here likes the longer-term

story and chris rolt listen likes marvel, in how much it's come down from an accret on stand point. we'd highlight those two and not the sector as a whole. >> mark, how would you dmaf gait it obviously, a lot of these stocks are cheapner a hurry in the last few months what do you think might be some of the opportunities >> i agree with a lot of what stacy just said. these chips are not where we want high exposure we are high conviction under weight you don't want to trade in a trade war, since 90% of the revenuesco him from overseas, which is higher than any other sector they've seen huge gains since 2016 i think a lot of the stocks got ahead of themselves. amd gave us huge guidance. we don't like the sector we actually like invidia

they're a huge player in gaming. we're bullish on the gaming industry now viewing is down in all other sports, except for baseball, which is up a whom whopping 1% that's how popular this has become so there is obviously a significant amount of interest and demand within gaming beyond gaming, computing in general is becoming more visual. whether for gaming or computing, invidia's new graphics chip is supposed to be the best ever we're not a fan of the sector, but we do love invidia >> sound like a sector where you want to pick your spots, thank you very much. for more trading nation, follow us on twitter at trading nation. back over to sue herrera for an update >> thank you, mike here's what's happening at this hour, everyone senator elizabeth warren taking a break from her own re-election campaign to stump for a close allie in ohio, for democratic

governor richard card rord ray. >> i watched while rich cordray saved the people of ohio $2 billion when they had been cheated by giant financial institutionles >> that itself the kind of man that has the courage to stand up to the powerful and makes sure government works once again for everybody else. thousands of central american migrants resuming their trek through southern mexico, shifting to the texas border worn down by many days of long walks, many have dropped out and returned home. a california-based startup unveiling a smartphone in beijing. it will cost between $13 and there are 1,900. when it's full opened it's 8 inches, folding up, it has three separate screens on the front the rear and spine of the device are you up to date >> that itself the news update at this hour

back to you. >> sounds like al chem my. >> what's flip secretary flopping what it means for the overall housing market that's next. anything worth pursuing hard work and a plan. at baird, we approach your wealth management strategy the same way toa financial plan built to last

from generation to generation. we'll listen. we'll talk. we'll plan. baird.

i am a techie dad.n. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools 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.

less than 90 minutes into the "closing bell," let's get a checkon the rallies. the dow jones industrials is up, three-quarters of a percent. s&p 500 up three-quarters of a percent as well. we are seeing the strong efs by consumers and discretion areas and industrials. nasdaq is powering ahead up by 1.5% ahead of apple's earnings report tonight. the oil market closing right now. let's get to jackie deangelis at the cnbc commodity desk. >> hi, contessa. wti and brent dropping 2.5%. brent is worse at the close the spread is about $10 apart. another 5% in one week of losses and in a month, that increases to about 15% what's happening here? oil mark isn't convinced the stockmarket has stabilized there are concerns over the demand and the supply side as expected seasonably supply is

strong the reit balance we thought was happening may be slowly derailed >> jackie, thanks. now, let's get a pulse check on the state of commercial real estate cbre group, the largest investment firm out with third quarter results, beating the top and bottom line. they just announced they are taking on shares of hannah here for our power lunch exclusive is the president of the group. glad to have you back. we'll get to hannah in just a bit. we have gotten through earnings period there was a period of time in like last week people were concerned about the outlook for the company. you rent out space and invest in all sorts of sectors are there sectors stronger than others, weaker than others >> we're seeing the economy around the world being very healthy for what we do commercial real estate is strong because there is a lot of capital that wants to go into it and occupiers or tenants want to

take space that dame throucame through on around the world, in leasing and strong capital flows in real estate we're seeing things a little out of sync with the headlines >> you are not seeing industrial customers, for instance, having a dimmer outlook on the company versus health care >> health care, technology, certainly very strong right now. >> what are you seeing in terms of asia? is there any concerns the trade wars will impact asia given the fact that it's 2% of your adjusted eb that >> asia has been a little slower than europe and the united states in the last few months and we're watching that closely. but again around the world we've seen good things we've seen good leasing generally everywhere capital flow is a little slower into the u.s. than china from before that's being made up for by places like korea and singapore. >> what about interest rates of course, we talk a lot about how buyers of homes might be influenced by higher mortgage

rates, what about in commercial real estate? >> in commercial real estate, the rise hasn't been a factor yet. what's making up for the rise in interest rates is just a massive amount of both debt and equity capital that wants to be in commercial real estate we've seen much bigger capital flows around the world this year in special real estate than we did last year. >> i'm curious about hana and this new offering. is it really a competitor to rework is there any degree of cannibalization to your core business i mean, could you be in a situation where somebody says, we want to go for the hana flexible work space as opposed to signing a first quarter lease commitment >> the strategy for hana is to work in partnership with the landlords we serve today we lease about a billion square feet of office space for land lorsd around the world, in multi-tenant buildings they wanted this product they wanted to do flex space in

their buildings with somebody that can build it and operate it for them >> that flex space market is growing rapidly today. it mangs up about 1% of the office space around the world in multi-tenant buildings we think that will go to 10% over the next ten years. big opportunity. >> how important is the outcome to the way you see the outlook for the rest of this year 2019 >> we are in our ninth year of double digit growth. it doesn't matter whether there is democrats or republicans in control. this i think so have gone well the economy has been good, our business has been performing really well. we're doing things for our clients our competitors aren't able to do we don't think it has anything to do with who is in power politically. >> there has to be one thing that keeps you up in >> labor the unemployment is getting so low. a lot of the growth in the economy has come from adding jobs in the tech sector and health care sector and so forth. if it gets tough to hire people

that can be an issue right now everything is looking pretty good. >> thank you nice to see you. the ceo of cbre group. from commercial real estate to residential, flipping homes can be lucrative but if you are looking to flip a home right now, that may not be true diana olynyk is in washington. we were talking about this when we were together. >> reporter: always talking about it >> that lo bore shortage has some flippers fleeing. the number of gnomes e homes flipped, defined as a same bought and sold in a 12-month fell 18% naturally with 2017 now, in california, where prices are highest, the number of flips was down a steeper 22% a contractor has been flipping homes in the los angeles area for 30 years usually selfer with year, this year just with un. >> it's not only becoming more

expensive on the purchase side of flipping, but it's becoming more expensive on the fix-up side of flipping. >> reporter: because of the labor shortage and increased material costs flipping fem to the lowest level in nearly seven years. it is also taking much longer to sell a flipped home. now an average 186 days. that's the longest since june of 2006 flippers have a lot to choose from, older homeowners are now staying put because it's so expensive to move. >> we talk a lot about rising input costs. when you go in are you at a home depot or lowe's, you can see where price versus increased if you hire a heating contractor, an electrician you may be waiting for a long time or have somebody that shows up and disappears, how much is that all factoring into this problem of trying to make a

profit flipping a house? >> reporter: it's all of it. look, you can't find the labor, you can't find the skilled labor and if you can it will be much more expensive, all these workers out there know what demand they're in. you have a lot more competition from the big flipping companies doing 100, 200 flips a year and have all kind of resources at their disposal if you are a single flipper or a couple houses a year, you are at a huge disadvantage. >> what is needed is entry level homes. is there any profit in that in. >> reporter: no, actually what they're saying is it's the move-up homes you make the most money on the ones that need work you put more work in them. then you sell them at a price premium. as mortgage interest rates rise and first-time buyers are looking for that home, they can't pay that premium for the turnkey home they're likely to buy a home that needs work and maybe they will do that work themselves >> thank you very much, appreciate it. well, we are counting down to the big report that even is

waiting for apple earnings after the bell tonight the key areas analysts are focusing on, what they are saying where the stk oc goes up from here. it's up 30% from here, "power it's up 30% from here, "power lunch" is back in two.

what do you look for when you trade? it's up 30% from here, "power lunch" is back in two. i want free access to research. yep, td ameritrade's got that. free access to every platform. yeah, that too. i don't want any trade minimums. yi want to know whate, they i'm paying upfront.hose. yes, absolutely. do you just say yes to everything? hm. well i say no to kale. mm. yeah, they say if you blanch it it's better, but that seems like a lot of work. no hidden fees. no platform fees. no trade minimums. and yes, it's all at one low price. td ameritrade. ♪

a big countdown to apple news in less than two hours. the company reports earnings the stock made it out of the ugly october tech rack in better shape than its peers the big question is can apple start off on a high note for tech let's bring in the senior analyst, anything loss, good to talk to you today. what itself the momentum apple is taking advantage of that the other fang stocks have not had at their disposal? >> thanks for having me. we look at apple relative to those fang names clearly the valuation is something that distinguishes apple from those fang names and when you kind of look at where the consensus estimates have come here over the last month, they've actually gravitated higher since the announcement of

the new, the next gen iphone so we saw iphones or you know revenue at about 4-and-a-half% for fiscal 19 entering that announcement, we're now sitting at 6.7% revenue growth for fiscal '19 so view is that it will continue to gravitate higher >> given how high expectations were and are for the new phone models coming out where can apple improve on expectations? >> yeah. i mean what's going to obviously make or break the quarter here will be average selling prices we continue to believe they remain too low as far as average selling prices are concerned we think for the september quarter and we think the son census that are out also too low. we think at least $820

we think there is upside there we think it will be extremely important for investment sentiment perspective. we think it should also propel >> are you concerned about china? new government numbers sited saying that the shipments for iphones are down about 24% >> yeah. when we kind of look at not only apple here in general but when you look at the broader smart phone industry out of china it has clearly been some softness going on there that being said there has been softness going on for a protected period of time app apple has been able to buck the strends there. >> and government data shows these smart phone shipments are down 12% not 24%, as i sited >> and i will say this, one thing is for sure. i think volume will be hard to

come by when it comes for the broader smart phone industry we do think apple is taking share out in china we think the average selling prices will help, you know, offset a lot of that softness. will it completely offset that it remains to be seen. it is an area of concern we remain optimistic there >> the december quarter will be the full quarter where we have iphone 10 sells. are you concerned about the 10s and 10s max which would bring telling prices down? >> no. i think when we look at average selling prices here for the december quarter, again, our view is north of half of the sales for these devietss are going to come from that iphone xr we do expect it to some what con

balli cannibalize those devices. so we are not necessarily concerned about it we do think that iphone xr will be the key to whether they have success in that quarter. >> all right thank you. we are only five days away from midterm elections and one of the candidates hoping to keep his seat is brown who happens to agree with the president's trade follow si on dhien that but says he would have executed it differently. he sat down with our own, john. >> take a listen >> i would have explain today the american public what in fact he was doing for the end outcome

to deal with chinese cheating basically. half the world's steel capacity is in china. they will work their way up the supply chain so they undermine american manufacturers >> isn't the lesson that is continuously in the freer movement of people and aren't you basically trying to make water flow uphill by interfering with the laws of economics on that >> well, the laws of economics haven't worked for much of this country in terms of industrial jobs, working class people regardless of race >> the fact is look what's happened you think trade has nothing to do with the fact that the 1% are getting richer and richer and richer >> of course this is going to create an interesting dynamic after the election even if democrats do not retake the senate they are likely to retake

the house. you can see a fuller version on cnbc.com and listen on iphones or where ever you get your p podcast. not only is he favored they are somebody they will talk about in the 2020 democratic race >> i thought the senator's response he talked to was interesting and he said he wouldn't have called it a trade war. has anybody called it a trade war? >> well, i believe president trump once said trade wars are easy to win. >> uh-huh. >> and so what we have been seeing with reaction to the markets and uncertainty involving our relations with china, we have seen they are not easy to win. it doesn't mean the policy is

wrong or confrontation is not wor worth having but they are easy to win it is for targeting our allies, european union as opposed to coordinating on a full concentration with china which is the cheater transgressor. >> thanks. >> thanks. the pod cast is called speak were you satisfied with the attention you were getting? then i explain that being independent gives our firm the freedom to give our clients the attention they deserve. we can put a plan together that makes sense for them. easy check please is next easy visit findyourindependentadvisor.com medicare is great, but it, doesn't cover everything -e.

only about 80% of your part b medicare costs, which means you may have to pay for the rest. that's where medicare supplement insurance comes in: to help pay for some of what medicare doesn't. learn how an aarp medicare supplement insurance plan, insured by united healthcare insurance company might be the right choice for you. a free decision guide is a great place to start. call today to request yours. so what makes an aarp medicare supplement plan unique? well, these are the only medicare supplement plans endorsed by aarp and that's because they meet aarp's high standards of quality and service. you're also getting the great features that any medicare supplement plan provides. for example, with any medicare supplement plan you may choose any doctor or hospital that accepts medicare patients. you can even visit a specialist. with this type of plan, there are no networks or referrals needed.

also, a medicare supplement plan goes with you when you travel anywhere in the u.s. a free decision guide will provide a breakdown of aarp medicare supplement plans, and help you determine the plan that works best for your needs and budget. call today to request yours. let's recap. there are 3 key things you should keep in mind. one: if you're turning 65, you may be eligible for medicare - but it only covers about 80% of your medicare part b costs. a medicare supplement plan may help pay for some of the rest. two: this type of plan allows you to keep your doctor - as long as he or she accepts medicare patients. and three: these are the only medicare supplement plans endorsed by aarp. learn more about why you should choose an aarp medicare supplement plan. call today for a free guide.

the internet markets started with that trump tweet at about 10:00 saying that the president had con truktive dialogues. it helped ignite the rally higher it underscores that markets are worry about the fed and tariffs and the impact on the markets. it is also helping the chinese stocks the etf is higher by about 7.4%. this is something to watch as we close out the session. >> we are also keeping an eye on google walk outright now we have seen hundreds if not thousands of employees leaving the building it happened around the world

i am interested in one particular demand here it is cases of harassment and discrimination critics say when you force a woman or man to go into mandatory a by strags rbitratios them no recourse >> yes >> thanks for watching power lunch. closing bell is next >> i am brian tonight. >> here is where we stand as we begin the final hour of trade. the dow is up 248 points at session highs. we are not too far off a nice 208 rallying across the board through the s & p 500.