go out and vote everybody, make sure you join us tomorrow we'll be talking about that. "squawk on the street" begins right now. ♪ >> good tuesday morning, welcome to "squawk on the street," i am carl quintanilla with jim cramer and david faber. jim has voted. europe is uniformly red and the 10-yr yield, 319

we begin with wall street for the midterms we are keeping an eye on that slide in apple share down more than 9% since late last week. earnings watch, the hotel giant is citing weaker demand and retailers with disappointing comps. americans headed to the polls with a lot at stakes for the president's agenda republicans holding onto senate control. although the journal in morning jim says elections have minimal impact and you have powerful forces like tax cuts and trades and the job market the way they are. >> i read that i have been wrapping my brain for the last week about an election where i say you would buy this and that other than

defense stock that should come down i am hard press to come up with things to do the forces is the fed. tariffs and the president and not necessarily about the market i really struggle it going through the s&p 500 charts this weekend looking for something profound per se and i struggle >> are you in line with joe on "squawk" this morning saying it would be different if you didn't have so much deregulation in place. >> you do. >> are you happy to have it now? >> there are enough strategists out there who say gridlock is good oil and gas is not nearly deregulated. we want pipelines and not the rights to drill and be back at schools. there is not a lot

there is not a lot now, let's go with unexpected outcomes one being if neither chamber changes majority >> right >> i guess would be viewed positively by the market >> i think market kind of just once when i look at all the chart the markets want to have it be wins >> we want this over want this day over >> what about the senate unexpectedly and the house to go to democratic control. >> i think people will say now the president is in check. no more wild and crazy no more surprises. >> he can get crazier, not less crazy. >> angrier all the taxes are done it is jay powell if jay powell were on the bla ballot, it would be a different thing. >> yellow verses powell.

who's lower on that push the president would vote for yellen we are about to have our ninth rate hike. is there anyone coming up in the last 48 hours. did anyone have an earnings report that reflected of a strong economy can you believe this >> marriott. we are not talking about motel six here >> no, cue four, they're looking for two. that's not usually a good sign in north america >> i saw arnold in september not that he can wink and a nod something happened i have been saying this over and over something happened in the last six weeks of the country that made it so the overall is that the fed is killing the economy, our world with the chinese is killing the economy.

europe is killing the economy. marriott does not go down. it is a great story and it does not go down. >> we have been hitting 52-week lows >> these are tragedy stories airlines have not been that good are you seeing this? >> it is not just about macao. they should change its symbol. >> by the way, he sold -- the man sold at the right time >> top of the market steve wynn is smart. in and out >> your term of crazy story, we are on track on the best etfs growth since 2010. >> nobody cares. supply change.

>> we have to talk strucker shortages. >> did you see upsp sells, why trucks are rolling over, production is rolling over earlier than later this is a common piece and this is point-blank saying that whole move -- i am struggling to find a theme that's working louie had a great number people are saying louie is over done let's get the elections through. >> there are notes today about tech and semis and small caps and the ndx are all under pe performing the price and volume trends are explosively positive we are not getting that.

>> no, we are not. i have to tell you the gloom is so powerful. >> really? >> yes, what ises the a the all highs yesterday? what do i always tell you not to drink. >> bleach, clorox. >> kitty litter. >> with the higher multiple than alphabet >> apple would be at 470 i forgot to mention that apple is down. i have not talked about ge >> no, you have not. it is 9:07 >> look at this clorox when clorox is the best performing stock, what does that say? we need a wash out >> what is it saying >> it is saying we can't have another hike president jay powell >> what if we show you 50,000 jobs >> what would that tell you? >> never stop with that. what >> we can put up some charts

arguing why you should have another hike >> i want another hike i am in favor of it. >> i want to pause how about yell loen coming out against my view, siding with jay powell the institution must be preserved. how about the economy? how about preserving the economy? do you think we can handle 5% interest rate? >> why should we be able to handle the 5% mortgage rate, why? we need to let other people make money like people who work for a living c living you get 3% 3.1% wage. >> imagine going to your boss and say boss, can i have a 3% increase >> we went through many years where people want to make money and people are on a fixed income >> i am to say that we need to

have the fed pause the fed has to go through the well-built d well build. well build is a classic case the stock is down 26% yesterday. freight. metals >> yep, good point well taken. everything but oil really lately >> exactly >> for more on the midterms, let's get to eamon javers back at hq. jim's point of settlement right now kind of explains why the economy has done what it has in terms of being a talking point in terms of the incumbents >> talk about the idea here that whether or not presidents can depend on the stock market here. let me make an argument for you

that presidents can't depend on the stock market take a look at this data back in 2006, the sitting president, george w. bush, stock market performance for george bush up to the monday before the midterms plus 13.62% that was a good year on the stock market what happens to george bush? lost the how in 2006 president obama, that year, up until the monday before election day, stock market really rocking and rolling at 12.7% as of that monday, what happened to barack obama in 2010? lost in the midterm election today, president trump talking about the stock market more so than any president we have had, his stock market performance up to the monday of midterm, just 2.42% for the year

that's not a great number. if the president is hoping for the stock market to come and save his bacon for the midterm election, not going to happen. certainly not going to happen. this president is going to have a strong showing tonight in the midterm elections. it is going to be about other things in the economy, not the stock market it is going to be about jobs employment and wages and how people feel and whether their brother-in-law got laid off or not. the way people live the economy. this has not helped other presidents in previous year. >> eamon, that's good stuff. >> great report. >> it does not take into account of the gains we built in year one. >> again, i just think that everybody is thinking of 2019. and 2019 can't be as strong as 2018 when you see a stock like this up really big. that's an anti growth stock.

she went around and did a tour of people saying don't write me off, don't write my company off. i got to hand it to her. that was a good corner these are anticyclicals. >> are you going so far to say powell, the fed, could cause the president the house? >> bingo >> well, no wonder he has been so mad the president. >> don't get angry at me >> you think the prospect of higher rates are having an impact already >> we have gone through an earning season is positive >> say it after me

>> pete, pete. >> say it with me. >> do you think the blended growth rate would go beyond 27%? that's not the fed's fault >> no, i think if the fed went back to saying, i have this idea for the fed. it is like you know what, we ought to see what happens. because i know that's a radical idea you know what the fed's record is here? how good is the fed's record trying to not get us to have a recession. how about uncle ben? i didn't mean uncle ben, i mean

evacu vern vernacke >> i see so many smart people telling me, don't worry. he's got a plan. >> you see a recession coming in 2019 >> dropping bombs everywhere today, jim >> i am on too many conference calls. the well build conference call david, you got to listen to it >> all right, okay >> it is about growth. where is the growth? and i just found ben, he took rates up too far i don't want that to happen again. the reports are so -- let me throw it their years were not similar >> i take back everything i said >> let's go to a break >> when we come back, jeremy siegel, what it may mean for your investment money. the russell and the transport is still in correction. back in a minute

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amazon will split its. >>

locations. splitting the hqs between cities are likely cities have not been chosen yet. bezos opens up the plain field and gets competitive and cities compete against each other > >> talk about something that could really do a lot. david knows long island did better than anyone that's a nice, good area >> it has been an up and coming area new york city, it is apart of queens. the president's hometown interested in where he live and grew up. >> that's your take away >> not really. i just want to make that point it is now here for many years it was a one day. 31 towers. it is what they wanted it is near the airports and th

transportation is not bad. they just announced $170 million additional span on transport and a number of other thing in that area governor cuomo in new york said he'll change his first name to amazon if he gets these guys come in there. it is unclear if it is a definite to carl's point, amazon already has a large presence in new york city as they do in the capital >> they could have changed, 25,000 jobs in newark. >> another thing that does not get the attention deserves here in new york is we have this university, this technology school, kornell, they're graduating a lot of software engineers. that's helping perhaps to entice companies such as amazon and there will be a train force available. >> they promise 13,000 jobs.

they're considering bringing in chinese engineers because they're nowhere to be found. >> good luck unemployment rate is about 1%. >> originally that was supposed to be 30,000 jobs and now it is closer to three. >> it is just areas of the country where you can use this and you can change the fortune you put it in a tough city >> you could but would that be the best decision to make for amazon and its employees and shareholders and its customers >> well, if you where milton freedman, yes. if you have a heart you can change the future of a whole city >> queens got 3 million people >> my wife is from 164th, she's a big winner, she's from queens. >> it could need some help >> they could put brooklyn >> i know you pass through it on your way to the mansion. >> queens can still use some

help, okay i >> i am just saying. >> would you loo i cike that >> i was hoping a little boost to a neighbor, like newark >> well, it is not over yet officially at least. maybe a decision this week we'll get cramer's mad dash and count down to the opening bell and another look at the pre-market here, back in a minute

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all right, we got a little

less than 7 minutes, 6.5 minutes before we get started with the opening bell cvs is going to acquire aetna. some states are yet to sign off. the company itself had a really good quarter >> the market is looking down at the opening could be an opportunity. >> prescription -- remember when we thought that amazon is going to come in and destroy cvs well, that's not going to happen this is a terrific quarter and david, the combination between this and that may turn out to be genius >> cigna turned out to be genius i have to say that if cvs comes in, you should buy it. >> larry merlot, i wonder how

much of the collapse of writing. >> walgreens did not have a strong quarter >> walgreens is not executing the way i would have thought their execution is really being questioned >> is it >> i had a conversation with the ceo a few weeks back they say they also consider as a healthcare company as cvs has become >> they are. i have to tell you that larry merlot is a visionary and less of a promoter. you will see how big portfolio measures a really good quarter. >> a rllight, we got opening bell coming up, stay with us on "squawk on the street.

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history. >> i have never been in line at 6:03 this morning. i had to be in line and even the presidential election. there were ten people ahead of me in jersey maybe this is a super charged midterm. it would be incredible or great that people come out and vote for the midterms >> yes, it is going to be raining in the mid coast, hopefully it will not discourage anyone coming out. >> this was really one of those. it is so interested. i have been talking about people jim, do you still like square without sara friar >> i never see a cfo has such impact in departure. see what's going on? i think square is as buy >> city goes to buy. they even mention progress on the cfo search

>> always best of luck to sara who was brilliant. let's get to the opening bell here and the s&p at the cnbc realtime exchange at the big board. it is voya celebrating the 40th birthday and at the nasdaq, shutterfly >> when i was at goldman sachs, i never go to my boss and say listen, maybe we should build a 401-k practice my boss says it is never going to come. i walked outlooki looking like n idiot. >> now the president talks about it all the time. >> i didn't mean to talk over you. a lot of the companies that i deal with who are affiliated

with the nfl, it is too antidotal to do. we are doing a veteran show on monday for "mad money. >> you started the football season saying that ratings would be up and not down >> no, i felt that they put some of the problems behind them and all new teams are doing well i said in los angeles that's going to matter. chargers and rams are excellent. we have different teams doing well that's quite exciting. >> not here in new york. >> no, the saints are so good. oh my. >> they are so good. >> that was a pleasure >> mylan our biggest gainer of the day, you mentioned that. >> heather bresh, she has done a remarkable job people were critical of mylan

and what they're doing to do the stock was down miss bresh delivered a good quarter and i have to tell you a lot of people did not realize how powerful that story can be and, hats off. sometimes you have to say that's good management. >> apple is up, not a lot but after a couple of bruising day, jim. >> i have to tell you, apple is not done going down but there is, don't forget a huge amount of stock was built -- of an average of 209 remember what luca the cfo told me he rather buy back stocks and having sit there to make money please wait until every seller is done. it has a real good feel. >> just so you have a reason, morgan stanley is saying 10-k highlights and working out inventory. yesterday was the story about an

asian take were saying one of the phones were not doing well my work reporting says ignore that story the average selling price -- >> at foxconn taking up a lower end phone. i guess using only 40 lines instead of 60. i am he september -- really comes up in a fabulous analysis today. this is morgan stanley about reduced cap ex guidance. if they can get india going, india was disappointed tim cook had to spend a lot of time in yadia. look at what walmart did you got to invest more in india. >> no, people have multiple phones in india given how cheap the provider it is >> how did you know that >> i don't know. >> it is one of those things that's stuck in there.

i think seema mody may have told me >> i saw seema last night, she's doing great stuff. >> there is a real incredible collapse a lot of the inner products. >> so i think apple. today is the day we finish. apple is the leader of the market you see tech is doing better gridlock favors tech but we have to get -- if we get a fed that just says you know what, we have seen some things let's wait and see you will see a rally to end all rally. i want to make people to understand on twitter is the same if they do three fed rate hikes. then you would get that. >> it will be the end of all rally. then you say that's the end. it is the end of all rally >> we'll never see a rally >> i have long-term view

i am thinking about december what >> jim, has caterpillar tries to reclaim 130. >> i know. >> there are bullish activities of etfs suggesting that we may get something. >> and boeing talked about it in singapore. >> i think the chinese needs boeing more than boeing needs them the most encouraging thing i have found in this quarter of china was the estee lauder quarter where they saw an uptake in chinese buying of high-end makeup that's significant i think china, some of it is slowing but not the consumer i think the industrial market in china is slowing but not consumer i see a lot to like. the fed is continuing to be

reference in these conference calls. that and the lack of -- we need 50,000 more of truckers in this country. we have seven more that needs to be transported thank y again, it is the leader of in the consumer package, colloroclx >> elf is doing well you want the play that game of initials >> i want to look at ralph lauren because it is down. >> let me tell you north american revenue was up 1% on a reported basis. european revenue is down 1% on a reported basis flat to last year in constant currency asia, a much smaller overall of course was up 13%. not enough though, well, i am going to make a statement that

you may not like that stock could finish up today. >> why those numbers are still better than what i was looking for. he's cleaning up a lot of bad stores another one that i really like these are ceos coming in and they're saying okay, we have to close the under performers to get better i like ralph lauren. i like lowe's at 97. these are ceos who are not afraid to bite the bullet. >> ralph lauren had a good year in the stock it has been up >> maybe today i just think the quarter was good >> matthew boss agrees with me at jp morgan i do like retails. i think it is going to be a good holiday. >> it was not many days ago we saw sonic being bought point. >> we are seeing stocks that are being hated. okay

where the market can't resist. buyers come in and say you know what, the market hates that stock too much sonic was hated. i thought sonic is a good company. i like their stuff but it does put a little bit of calories in there. these companies are just so down that people are given up on everybody -- everybody is giving up on convenient quick serve except for the private equity guys it is funny, the private equity guys figuring to a lot of conversation lately involving speculation of take out whether s whether -- although i continue to hear that's still moving forward is a possibility in the next couple of weeks we heard a lot on arconic as a big take out

>> you are talking about companies that are not doing well that there may be buyers. >> it is interesting with private equity that's figured prominently in the mma conversation and speculations. >> if you do speculate, you have to be careful that you are not getting tipped by the warehouse. i am saying frisco i thought maybe it was a signal that restaurants are weaker. b you see all those cisco trucks on the road, any drivers or warehouses that's the supply chain problem. that's really taxed by strong growth you don't need the fed to push it over. >> right >> you are back to the fed

>> we had like 30 seconds off from the fed >> okay, so what do you want me to do? >> why don't we get jay powell here so you can talk to him -- >> i like jay, i have known him for 40 years he's a great guy he's listening to the show now he's in a box. trump wants him to go slow and cramer wants him to go slow. he's totally in a box. when ever someone is pespeakinga a third person, don't like them. >> i never liked the third person >> i want to make sure people understand, it is still a possibility that thing is going to get taken out >> really? what i have been hearing from people close to it was not this week but may be a couple of weeks before they gotten it together the numbers were not strong in the earnings i want to come back on that. >> we waited a long time for you the talk about alibaba >> there is acadia healthcare.

>> what about alibaba? >> it is up. 2.6% >> again, apple is the key to market in case you ask me about that i think he's in there buying it and you can continue to sell it if you want to you can sell right into his buy back i was calculating how much they buy everyday they're about the maximum that you can buy everyday by the way, so is that green buying for duponte >> it is incredible to me. >> why would you do that > >> well, because you are really smarter than everybody else. you are seeing west lake reporter is really great today that's the reason why you may want dow dupont. >> et that i know needs to coha.

>> we need to get a big cold snap too led to some of this >> absolutely. >> i think it is exciting time because if we get through this midterm and we get a fed's statement of any kind, which says hey you know what, we'll put a rating increase and we'll watch, that's it that's the scenario which makes it so the bears -- like in jersey when they have the day where you are allowed to shoot them it is going to be that day >> the bears are all over the place. >> yeah. >> real quick from my world. you mention buy backs, it is up strongly this morning. they're buying back a lot of stocks >> that's a more balance sheet >> what do they got? a letter f balance sheet you are on it. yet they bought back and they

have a target of $5 million in share buy backs, altice usa. they did have a good trend revenue growth and the overall numbers did not looked bad at all in the market responding accordingly. you are right, jim, they chosen to keep with the buy backs >> or service. how about the other side avis? what a challenge business you have in the rental car business? a lot of that is uber and lyft and millennials. >> i am putting the millennials index. yeah, i may have to include avis, millennials don't rent cars >> right >> they show up and they get an uber or lyft

>> what happens? i got to tell you, grub hub, too. these are things they just love. they won't go anywhere millennials never leave the couch. everything is done on the lazy. >> build your millennial basket, jim. >> apple is helping things out along with caterpillar let's get to bob pisani. >> good morning carl, happy tuesday. about the market, we started 3-2. now, we are about even sitting at the highs of the day. what i think is important is good on tech today, broader than that that happens on saturday yes, tech is doing well. but, we also have industrials, we have materials, we have energy stock as leadership group. this happens yesterday aztec was on the weak side those secotors saw notable

buying fa fang stock is doing better today. it has been a tough couple of days of apple, apple was 220 on thursday we lost 10% in two days on apple. facebook is a little better and amazon and netflix and a falpha is a little better here. we have been seeing rotations sense last week. the market bottom is monday, the 29th of october, and since then the s&p is up about 3% the fang name is generally urn performing the s&p has been up 3% since then facebook is still under performing and netflix is out under performing up about 5% major sector, again, some reati rotation we are not seeing much getting into tech. consumer staples have out

performed. s&p is up 3% since october 29th. did we see this notably yesterday in they take money and put it into other areas of the markets. am i the only one that has a problem of the consensus of the stock market that the democrats will take the house and republicans will maintain control of the senate and if market will go up. the market likes gridlock. the market has gone up the last two years on the idea that there has been no gridlocks. as a result of that. the market has risen on lack of gridlock now everybody says oeh, it is going to get gridlock. i think we are going to have problems with deficits and a lot of republicans are going to be concerned about that once again as they should be. i think stimulus spending is going to be a tough call i know everybody wants an infrastructure build and i don't know how anybody is going to figure out how to pay for that

that's going to create a political embroil. my point here is i agree historically the fourth quarter is a good quarter for the midterm elections. everyone knows that. we have an unusual scenario here with the fed and trade tensions and all sorts of things that we don't have to deal with. i will be careful going along with the con consensus we are at the highs of the day, back to you. >> thanks, bob pisani. >> rick santelli at the cme. >> yeah, i look forward if we hold onto the 7 million handles on job openings. all maturities are sharing two things in common they're all unchanged. all maturities are at our close to their cycle highs

2-yr note, at or taken out we are about to click to 292 you look at one week of tens, pretty much. it held against the new high at 323 on top we are trading between two important highs. could anything be more firm than that especially there times when it seems to be uncertain of the results tomorrow have you look at the italian market, a lot of talk today of the rates being higher and they are. we are trading 340 look at a year today to the chart. first of all, you need to notice that 370 is the high from around the 18 of october. we are down from there just ponder. they're at 201 at the end of last year. it is possible they can double their ten year rate by the time we hit it. 370 is darn close to 4%. if we think of high yield and

all the volatility that we experienced in the equity market and some extent of how calm the treasury market has been let's look at the barclays, i say take a big step back and looking at the three-year chart, you can hardly notice of the last mogumogul. that's the point they did not pay attention to the extent they have historically and finally when it come to the dollar index, i look at the year to date chart. a couple of aways to look wayst it we are not at the high closes of the year carl, david, and jim, happy elections day and back to you. >> thank you, mylan is leading the chart almost of 12%.

mosaic and vix is below 20 belle be laback in a minute.

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'many shares went from 222 to 198 in just three days. trying to get some of that back now, back above 200 at 204.21, watch that closely as we'll get stock trading with jim in a minute 123450

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let's get to jim in stock trading. >> okay, we if elf up today, lower end cosmetic estee lauder up last week. what does that tell you? it ulta. i think ulta is a shot to take out its high when it reports in december because those are the two inputs that you really need to know. so, there it is. >> do we consider these names growth or value since oil of olay >> it's selfie it's just people that want to look better. there was a sign on the voting booth that said absolutely no selfies allowed. what do they do? go in there and take a picture of them voting? >> it's like a cone of silence for people >> that's the only place you

cannot have a selfie in the booth. you can vote for ulta by buying shares of ulta >> jim, tonight? >> i have tonight, we're able to talk about why the tariffs are working. and then i have ring central because ring central is doing very well. >> what is ring central? >> technology. >> okay. >> the rubric of technology. >> see you tonight "mad meyon" at 6:00 p.m. jeremy siegel is going to join us tell us what it means for the markets. dow's up 62. he crowd, the investment managers at pgim take a long term view. uncovering opportunities for alpha across public and private markets, while anticipating unforeseen risk, has powered our rise to a top ten global asset manager. partner with pgim. the global investment management businesses of

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good tuesday morning welcome back to "street signs. i'm carl quintella with sara eisen. >> our road map for the hour starts with election day in america. we'll run through the potential market responses what the results could mean for your money plus, under armour under

some pressure today. a bombshell reported about the sportswear maker corporate cars, strip clubs. sara talking to somebody within the company. and amazon, and the hq2, two companies, a split could be in the works. let's start with midterms and your money polls open across the country as stocks take the wait and see approach steve leisman has the new fed survey taking a look at how stocks are priced in and jay wells is in phoenix, arizona with a record number of women running for office leslie pickler is following the bigger implications for hedge funds. and rick santelli is here with us, as he gets ready to speak to alan simpson, for his talk on the economy, regulation an your money. a huge hour for you straight ahead. >> rick santelli has got jolts hey, rick.

>> absolutely. now, remember, we crossed that 7 million threshold so that's the new benchmark to pay attention to for the series going back to 2000 the september read holds to 7 million again. 7 million 9,000. it's the one that has been revised higher from 7.316 million to 7.293 million so, these things are really off the charts and just to show you how off the charts they are, we finished and the summary for jolts was 5.66 million. we have really extended. it looks as though the market and treasuries hasn't moved much on it but pretty close to high yield. sara, back to you. >> rick, thank you that plays into the election today. let's get to steve liesman with the new survey election style.

>> yeah, sara, we ran a survey to see how the market is priced. no surprise, nine% said they retain the house and senate. and 14% saying both house us and 7% say dems take both houses let's look at expected policy changes for those who think it's a split congress number one, the thing they think could happen is infrastructure number two, i don't know if it happens, gridlock or nothing and kind of a surprise here, a few of our economists think, and fund managers mentioned the possibility of immigration reform that maybe the democratic house and a republican senate get together with the president and they do go after that immigration issue. what's the best outcome for the stock market well, take a look here 52% majority say the gop retaining both houses. 38% say the dems taking the house and the gop or senate.

nobody saying the democrats are taking the house and 10% of the market says it doesn't know how about the economy, 48% say the gop retaining both houses and 31% saying the democrats now, guys, there are polls and there are polls. there are political polls and there's economic polls i just want to point out a couple other polls that are out there. you may not think of as polls. there are polls that show president trump with a low approval rating. we also have polls showing the consumer confidence in michigan showing a very high confidence rate there's the opposition party, or the party out of power, taking seats but there's also another poll the unemployment rate is actually a poll. it's a survey of 60,000 households around the country and that shows a 7% unemployment rate you've got the political poll who is going to take congress and then the generic one, the

economic one in the country, and i think that plays out as a big factor in this vote. sara >> steve, i know you've read a number of research notes and economic reports on the midterms based on everything that you've looked at and sort of the past precedent here, which scenario would you think best for the american economy, most bullish for the american economy >> you know, i'm not a person who thinks gridlock is good for the american economy i think there are real issues to have out there i think the entitlement question is a major issue for the economy. i think infrastructure is a major issue for the economy. i don't have a perfect word to say this is better for the economy, that is better for the economy. but the congress doing its job and legislating and the president leading the country towards those compromises that, to me, is the best outcome for the economy. we have a congress and

presidential branch that do their job and actually get done the business that needs to be done for the economic environment to be the best it can be >> a lot of that involves engaging folks on the other side of the aisle, steve. >> what did you say? i don't even know what that means, carl? >> sorry >> steve, thanks steve liesman. our next guest says if republicans lose the senate, it will be a bad day. good to see you. >> thank you >> what do you mean by that that we mentioned in the lead >> i was listening to steve and i agree with most of it. i think we also have to look at the size of the victory in the house which is expected, the demes to take it over. i think the expected number of seats is 30 majority after the close. and if it comes about that and the gop keeps the senate, i

think, you know, that's a reasonably okay outcome, even though i think the market would prefer that republicans be able to keep the house. i just don't think that's possible i don't think the survey is going to peel off as much as some people think. >> yeah. >> i don't think, you know, a split congress isn't the worst thing. some of the greatest markets we had -- the biggest bull market is during the clinton administration and you know, we had a democratic president and a republican congress. there was a split there. i think what is a little worrisome, if there is a blue wave, i'm not saying there is, but if we see something like 45 seats majority. >> or a consensus. >> yeah, above consensus and/or the senate, you know, goes to even or even democratic, the question is what does that mean for 2020? you know, because if the

democrats come on really strong, i mean, i'm not worried about undoing the tax cuts in the next two year that's impossible, you know, trump being president. but two years from now, if the democrats take over as president and congress, they might undo the corporate tax cut. so, you've got to worry about the implications for 2020. >> right professor, obviously, everybody knows by now how markets have behaved seasonally in a midterm year, or at least in the nine months following the midterm others argue that the president has essentially front-loaded the markets in the first term. i'm wondering if you think that holds up this time >> we all know that the period after the midterm is usually a goodyear and the corporate tax cut has happened lowering the regulation has happened, it's already built in.

now, we're contending with a tightening fed an ageing, you know, expansion here that is pushing some limits, higher interest rates. you know, and if the democrats come on really strong here, i think there's a lot more uncertainty that will make next year not going to be the stellar year we usually get in third year presidential cycles >> you can really apply the conventionaled withdom, professor, that gridlock would be good for the markets and the economy even after what we've seen in the past year and a half which is we didn't see gridlock. and we saw a lot of stimulating policy in the form of deregulation and tax cuts and the market ran up so much. so does that make this time different, when it comes to potential gridlock >> well, you know, what i'm saying over here is i think the two things that had to happen, in particular, i think the corporate tax cut is by far the

biggest thing, lowering regulation is the biggest thing. i never thought infrastructure was going to happen. i'm not too sure that the economy, at this point, can take a trillion dollars spending on infrastructure all right? i don't know where the people are going to come from you know, steve talked about the type of labor markets. we just got the report again, it is drum tight. where are these people going to come from? so, you know, take a rest on major legislation. and let's digest the games that we have and see how we can move forward. i would love progress on immigration. i mean, i think we all will. honestly, i don't see that happening. >> yeah. >> especially if the dems take the house. >> right as you pointed out, on steve's survey, professor, best outcome for the stock market, gop both houses, 52% picked that. is there any risk then to treasury yields if that happens?

>> you know, it's hard to know where the treasury yields go because that really depends on the fed, how strong the economy is so if there's a big swing one way or the other we're going to see it more in risk markets and stock markets than we would in the treasury markets right away. so, i think that, you know, if there's a big swing, we'll see the stock market react treasury markets are going to be waiting for thursday, you know, just two days from now, we have a fed meeting that will also give us a clue for -- as if there's not enough happening this week, two days, we have a fed meeting. >> well, that's where i was going to go, professor there's so many risk factors out there right now, especially after the october for stocks we just had >> yeah. >> we've got worries about the fed. trade war. now midterm elections and politics and some earnings weakness, or at least guidance weakness you can rank those in order of importance for the stock market?

>> i think the long bond, the interest rate is the most important thing. the ten-year keeps on going up if the economy remains so strong and wages go up above productivity, they're not yet in that much danger, but that's going to be a problem for the fed and the markets and interest rates and corporate profit expectations i think are still too high for 2019 >> that's going to be something we're going to revisit on thursday and friday. professor, maybe with your help. it's good seeing you >> thank you >> jeremy siegel >> yes when we come back, under armour under fire, bombshell report impacting the economy and stock. we'll bring up to speed next keeping a close eye on the markets on this election day take a look at the top-performing stocks on the s&p 500. overall, green across the board. nasdaq having a come back doing the best in the big the.re here are your winners on the

street "street signs" will be right back don't go away.

let's look at shares of apple this morning they are recovering a bit, of course, after what has been a very sharp selloff since the company reported earning last week mike santoli is with us. >> yeah, as reflected in place, hardware is the particular

a lot of bellwether software and high ground hasn't been taken out. look at the standard, etf that has apple with about 20% waiting in it. it's up. doing fine but that north american software etf, oracle, microsoft, adobe, sales up a lot more 18% this year. does not have apple, does not have semiconductors. those things are crucial these are the main s&p tech sector, those are the familiar names. of course, visa has been another great performer. hardware like apple and semis have hurt it here you have the software etf and also the gaming exposure as well the question now, is this just a trend that's going to persist? and is this why apple wants to be viewed as a software company because of its superior business are we in for some kind of a mean reversion here? apple hasn't been broken

it's not even a hardware company. semis also have gotten relief. that's the relationship i think you'd watch in terms of divergences. >> would you argue that we're tantalizing close to the day >> yeah, you're right around the 200-day moving average and also at the level of the s&p that has had the greatest amount of chrrisscrossing traffic all year the highly traded leverage in the futures so far, so there's a quorum at this level it doesn't mean the first move is wrong or right b but it, buts interesting that we're kind of at this pivot at this point in the election mike, thank you. turns out it's a record year for women running for higher office, they come from all walks of life, including the world of business our jane wells joins us with

more on that story hi, jane >> hi, sara, we have a steady group of voters coming in here at the church of beatitudes. we have a record 25 women nominated for the house. a record 16 for governor like you said, they come from everywhere, even from business viviania boerio, she's running for a house seat around pittsburgh she said politics is like business mostly. >> maybe one difference on the political side, people want you to be a bit more emotional than they do on the business side they want to know your story they want to hear that passion and commitment >> yeah, facing an uphill battle, michelle farley who used to work at goldman and ubs she's running against another

woman, kirsten gillibrand. >> i think even my mother asked when i said i was going to run for u.s. senate. she said don't you need to run for dog catcher first. but with reality, trump shows with a strong business background, you can jump into something else >> it's interesting, boerio did early testing for her campaign one message presented her as a female executive the other as an executive. gender neutral women were attracted to both candidates but the men liked the gender neutral candidate better the one they didn't know was a woman. back to you. >> any sense of the gender gap within the actual voting population, and how important the female vote? especially college-educated females, reading a lot about that, jane, could be determining this election. >> absolutely. well, it will be huge if they can be -- if especially these younger voters can be -- can actually get out and vote, particularly on the democrat

side certainly, if you look on the candidate side there are a huge number of women who are first-time candidates and they are overwhelmingly democrats. and if you look at the nominees by a 2 to 1 margin, the senate nominees are democrat. and by more than 3 to 1, the house nominees are democrats >> interesting statistic jane, thank you. jane wells, as we watch the female vote and female candidates today under armour drama today "wall street journal" reporting that under armour told employees in an e-mail back in february that it was going to stop covering expenses for attending strip clubs. they attended them with celebrities. in a statement, the company says, quote, we've addressed these serious allegations of the past and we will continue to address workplace behavior that

violates our policy. inappropriate behavior that challenges our policies or unacceptable will not be tolerated. look, this comes at a tough time for under armour, the company was just starting to prove to wall street that it's maturing it's focusing on profitability and hiring key operates like patrick fiske for the business that's been the story on wall street so it is a bad look and people are wondering what took so long? this is 2018 number one, the founder and ceo, the company stressing that the founder is not implicated in this article and he did thought use company funds at a strip club so investors shouldn't have to worry about his leadership. number two, if you look at nike as a template, kind of went through this, accusations of

unfriendly environment toward women. that led to the release of executives wall street has viewed moments of reckoning as pr crises. under armour stressing to me this is all in the past, no executives are impacted by this. and you can bet there's a lot of soul-searching going on after being told in the article, it was a tough read it seems in 2018 the company would allow you to expense strip club visits. i don't know, you look at the show "ballers" on hbo, we reached out to nike and adidas and asked, do you guys have this policy as well we haven't heard back from them on that. clearly, companies in all industries need to take a close look and make sure they're creating a friendly environment. especially when you're under armour and 49% of your workforce is female. >> initial e-mail goes back to february >> february.

>> and went unreported the whole time >> yeah, the new cfo was looking at all sorts of expense policies and again, trying to change the culture at this company, what happened, though, it brought to light some issues with prior executives and sort of bad behavior with the company. and that's what's being talked about today, and clearly impacting the stock. negative headlines, pr risk. >> it's had a nice run here the last couple weeks. >> it's up 12% the last months and the ceo of elanco will join us next we'll talk about the business and grthow stock up almost 3% and the dow almost 50.

shares of elanco animal health moving higher, you can see that the company returning to growth in its third quarter today, by the way, marks its first earning quarter since being spun off from eli lilly. earlier this year. in fact, it seems like just yesterday we had the company go public here.

joining us here is jeff simmons, elanco animal health ceo welcome back nice to have you back talking about the company, or about the company again. >> good to be back >> the business continues to be strong and will continue to be strong it seems for quite some time it that simple >> yeah, i think the overall fundamentals of the animal health space continue, i think, to be resistant against some of the -- whether it's the economies of pet ownership, as well as i think just the underlying demand for meat, milk and eggs and the economy going forward. >> and the ability of those who you are providing various solutions to, the pay and everything else, i mean, are you sensing that the economy, in your part of the world, is strong >> we do and i think some of this is a balance that you have in a business like elanco where we're 50% u.s., 50% international. we've got about a third in the pet business, with a lot of the

growth coming from that pet space. and over on the protein space, we've got salmon and poultry leading our growth when you look at the underlying trends around those around those, we feel very good about the environment we're in a quick change from ipo with the results. and coming out of the gate, meeting expectations and really seeing the strategy come to life >> particularly, because the ipo performed very well, as i recall, just a couple weeks -- maybe a couple months, jeff. >> yeah. >> you were able to secure a price significantly higher where your underwriter set it. i know we made access on ipo day. eli lilly still owns 80% of the stock. what are their plans in terms of distributing some of the shares in the future? >> yeah. they've been very clear that they plan to exit the business in 2019. they're in a real strong position of strength with launching many products.

and as we look at the needs that we had, going forward, and from an investment perspective, this seemed to be the right strategic move so they will exit in 2019, the remaining share of elanco. >> hey, jeff, not sure that pet health care does as hot button political issue as people's health care during this midterm election season. what issues are most important for you, as we wait for the results to come in tonight >> yeah. i think that we just recently had our equivalent of a drug user fee app in the fda in the center of medicine just get approved i mean, this is very positive for us to be able to have a very science-based, predictable, regulatory path innovation we've launched a couple new innovations this quarter just like the pharmaceutical industry, innovation is absolutely critical. we see, actually year to date, the 11 key products that i mentioned on ipo day, coming in with a portfolio of innovation

it's about 90% growth compared to a year ago. so innovation to us continues to be critical. and i think that's the key fundamental that we look for >> so, it sounds what you're saying, the deregulatory agenda of this administration and republicans controlling the house and senate has been beneficial to your business? is that what you're saying >> well, no, not necessarily there's always going to be change i've experienced in almost three decades with animal health until elanco, six decades. i think there's always change and we have to look at it through a global lens. and the way i look at it, we need 75% more meat, eggs and fish by 2050 and those underlying demands trends are going to help us on the stock side and on the pet side, that ageing pet brings challenges and brings opportunities, as we see nice growth out of a product like our

osteoarthritis product and pet ownership emerging and i think those fundamentals are what make this business, you know, less dependent upon politics or external factors >> so, i think to sort of paraphrase sara's question, if there is a big target put on pharma's back and there's a call for transparency and pricing really gets in the cross hairs, do you think animal health suffers less than, let's say, farm at large? >> i think the industry dynamics are definitely business. we have a cash business. we have veterinarians and farmers as our primary customers. we work with them directly and we can provide value and i think that does allow us a competitive environment. but it is one that does definitely reward, i think, innovation, having global scale, have the ability to reach and touch those customers in a way that affects that. i would just say coming back to what was the underlying pennies of our growth this quarter, it

came to that three growth categories that we were focused on about 60% of elanco. those growth categories are growing at about 12% innovation, we launched two new products this quarter, as well as a new research alliance and a couple line extensions and then our margin expansion. we've seen price grow about 4% our operating expenses are down about 7% i think that overall strategy is what we're focused on and there are fundamentals quite different than pharma. >> yeah. well, we're happy to get an update a couple months, of course, after the company went public jeff, thank you for joining us >> thank you >> tried to get political, but no dice. let's send it to sue herera for a cnbc news update sue. >> good morning, everyone. here's what's happening at this hour firefighters in southern france said they have found a second body in the ruins of two buildings that collapsed yesterday. several people remain missing. at least one person is dead and more injured after severe

weather moved across tennessee overnight. officials are urging residents to stay inside and stay away from the storm debris. having high blood pressure when you're younger could be a sign of more serious health issues to come a new study of 5,000 adults over the course of 20 years find those who had blood pressure when they were younger were at a higher risk of suffering from heart disease, heart failure and strokes when they were older and it was a buzzer beater in the nba last night. the magic facing it's cavthe cas taking an inbound pass and nailing the hail mary attempt. look at that from just inside the three-point line there you go that's the news update at this hour carl, i'll send it back downtown to you >> sue, thank you very much. as we go to break, take a look at major averages on this election day dow is up, s&p 500 almost 9.

and of course, the fed meeting later this week. alan simpson will join rick santelli big show squawk on the street don't go away. (toni vo) 'twas the night before christmas,

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fly emirates. fly better. the street." i'm sara eisen here. markets inching higher this morning as investors await the results of today's election. regards the outcome history has shown that stocks do tend to rally. the s&p 500 have been higher one year after every midterm election since 1956. according to data from kensho, the s&p 500 has historically traded positive, both one tweak and 12 weeks for a look at what the midterms could mean for investor this year let's bring in the chief strategic at deutsche bank and global strategist at asset management

a lot going around, with the trump administration and can we trust the historical patterns which point to a very bullish market post midterms >> you know, you should always take history i'm not exactly sure how many pinches of salt, but it is a good way to start thinking about it you know in a sentence, my view is i do think that history will repeat but there's a very good reason for history to compete, in terms of the rally, rather than just being a repeat of history. >> so, here's something that stood out to us. you say democrats gaining the house and leading to a stronger rally in equities. not sure this is a consensus view >> no, it isn't, but definitely, that's our base case our base case is, you know in line with the consensus, as far as the political outcome is concerned. which is the democrats gain the house. that would be pretty typical for

a midterm election that's happened a quarter of the time and the republicans, you know, in the senate, keeping or increasing their majority, and that, i would argue is for idiosyncratic reasons. in terms of what impacts and implications this has for the equity markets, you know, the two points i think are important to make. the first point i think is getting a little bit lost which is it has become, as you said, a very, very close election. i mean, turnout is -- i don't know, i heard somebody say, i don't have the statistics myself but the highest since 1914 just prior to world war i which explains why it was that high. and, you know, the thing that one needs to remember about close elections is that the equity market is like any other market, tends to build up a risk premium around uncertainty it may be a consensus view, but if you ask what the probability that democrats are going to get the house, it's not really very

far from 50% i would argue the uncertainty band is pretty high. i'd make the point that there's likely a pretty reasonable risk premium in the market today. a pretty close risk premium. so as long as we get a good result that is not contested by either party, you should get a rally. >> i'm seorry -- >> if you look back at the presidential election, the predictions were for if one party wins, the other is going up it rallied >> you're saying the market wants to see it work the whole process work >> exactly exactly. number one is just simply, you know, a risk premium coming out of the markets and that, we would estimate, you know, historically as being 1%, 1.5%, 2%, as long as the issue is pretty clear

and some of the issues you were mentioning, as far as the particular configuration, that would matter, and matter to year rend and we can talk about that >> david, i have to get you in here, are you as bullish as binky no matter? >> i do agree from the seasonal standpoint, from a technical standpoint, historically, we have seen rallies following a midterm election and we are expecting a little bit of relief from the midterms going forward. the source of that relief this election along with the crystallization of the slowly outcome, and growth, the slower markets have allowed them to have indigestion here. importantly, as binky was saying, this is an area we can put a check mark next to and moving on thinking about the fundamentals and what any shifts in the structure of the government may entail for policy down the road.

>> i think it's important to lowlight, david, the sector impact here. all sorts of sectors watching for policy changes industrials, bio-tech, social media stock. give us a sector pick, under different scenarios. >> so, you know, i think when it comes to our sector preferences going forward. again, we're trying to stay relatively agnostic. we don't think that's necessarily the best way for that set but from the economic standpoint, there is the potential for a divided government which may or may not cross an increase in volatility, despite our view that the path of least resistance for the sectors is up. the sectors that we have a preference for is higher income sectors. we like financials we likematerials we like energy beginning to shy a little bit from tech and communication services we think despite the reiterating and valuations those names have had quite a run. and furthermore, i think the path of least resistance for

regulation is probably tighter in these sectors so that's another thing we'd want to be out of the way of. >> think of any sectors that the democrats gain more control of or vice versa in terms of government >> we think in terms of sector review, with growth in the third week of may where we had that intensification that would be late-cycle fears combined with tariffs and a trade war. so, the question is, you know, when does the market place in growth, i would say the rate-based and republican house and senate it's pretty good -- it would be the financials and industrials would be the two key overweights, neutral technology. >> guys, thanks for your thoughts >> thank you when we come back, former republican senator alan simpson

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professor robert schiller weighing in on what today's midterm election could mean for the markets and ecomony. catch that interview on tradingnation.cnbc.com for "squawk on the street" after the break. for decades banks have been getting away with it.

charging you excess fees. making you wait in line. keeping billions of dollars of your interest. they've been treating you like you're lucky to have them. that's not right. show them who's the boss of your money. you. better is out there. ally. do it right. welcome back to "squawk on the street". i have a special election day guest. alan k. simpson, former republican senator from wyoming and attorney to bird simpson, a thank you for joining me >> here we go again. >> yes here we go again listen, senator, i want to know your predictions of this

particular election, knowing how concerned you are with both parties with the predictions continuing to affect the u.s. and budget and future whether it's entitlements, deficits or spending you take it. >> well, you know, i don't want to be johnny one note on this stuff. i think this is going to be chaos. there's a lot to think about, all of this polling going on, everybody is accusing everybody else of lying. i think people get a delight in lying to pollsters that's my personal view. i know it's a sick one, i know that, but i think they get a real charge out of that. anyway, you can go on to think that every single candidate, the past president and now as soon as this election is over, we'll be talking about 2020, instead of the real things in life which is the budget and the entitlements and the solvency of social security. we're not talking about throwing old ladies out on the street

we're talking about the fact trustees are saying you're going to go up to the window in 2024 and you get a check for 23% less i mean, anyone with a brain knows this and yet, you do nothing. you know, a guy that could buy your whole studio and never get a bill who is kidding who this is nuts. >> you know, senator, before you go any further, i'd just like the public to know how the growth has been. i took the four biggest programs that eat up the budget, what they were in 2012 and what they are today. medicare, medicaid at the top, $800 billion today, $1.8 trillion social security, fast approaching $1 trillion now. defense spending $655 billion in 12 $670 billion now lateral moving there interest expense, this is eye-popping, $329 billion right now. so, yes, these numbers portray

what you're talking about, but both sides seem to be adverse to tackling this problem. it's about democrats and republicans, both of them. what do you say to them. what does the voter do in the booth today that could affect the future in that regard? >> well, unfortunately, the young people have no voice until they sober up or get serious, nothing is going to happen because they're the ones most affected anybody over 60 isn't even involved in the things that have to be done to correct this unbelievable $21 trillion debt, in another few years i mean, absolute madness to think that every single guy that gets elected is saying, let me tell you, i know the problem, but i can only tell you i promise you i will not touch precious social security, precious medicare, supeprecious

medicaid let me tell you, there's enough bloat in all of them to choke 15,000 cows. i mean, unbelievable stuff and nobody is going to do anything, but the horrible part of it is, as i say, when this baby is over today we won't be reading about the same be reading who's who in the president's race of 2020 it is madness. >> well, senator, i agree with you, and hopefully at some point we'll get any administration to try to tackle obvious problems, but at least up to this point i think you're right we're not able to do much about it today on voting day thank you for joining me sara, back to you. >> always refreshing to hear from senator simpson. let's send it to jon fortt with a look at what's coming up next on "squawk alley. good morning, jon. >> good morning, sara. continuing the conversation, midterms are upon us tomorrow what are the implications for tech. we take a look up next on "squawk alley.

stocks in a tight range, which is why we have attention to the downward reversal on crude. let's get to jackie deangeles for a sector check. >> stocks are hovering near the best levels of the day investors await results of

midterm elections later tonight. one of the relative underperforming sectors is financials among names leading that group to the down side, including big names like citigroup, wells fargo, jpmorgan, bank of america, one of the etfs down 16% from recent highs in mid march. now i'll send it back to you >> thank you, jackie. we continue midterm election coverage taking a closer look at a critical race in connecticut that could mean big bucks for the hedge fund industry. leslie picker is live in greenwich connecticut. >> reporter: residents have been voting in the town hall behind me for the last five hours in focus today in connecticut is the election for governor between democrat ned lamont and

republican bob stefanowsky the state is in an economic and budget crisis the last few years. thousands of residents fled the state, including some prominent hedge fund managers that also left he spoke with cnbc earlier, said policies under the current democratic governor malloy have driven many hedge funds out of the state. he plans to do away with state income taxes in the next 8 years in an effort to recruit and retain businesses into connecticut. >> we've had two of the largest tax kreincreases in the state ur dan malloy, and tax revenues are down it is only common sense we need to do the reverse, get the economy moving for ones still here, i say hang on if you have survived eight years of governor malloy, i am going to be pro-business, create a stable tax environment, provided a skilled work force

fairfield county used to be a financial services hub we can get that back >> reporter: we requested an interview with his opponent, ned lamont, but couldn't make it work due to scheduling lamont's tax plan also includes some roll backs, including trimming some small business taxes in the state as well as property taxes the polls coming into today have shown that this race is really neck in neck it could be a tight one as polls begin to close at 8:00 p.m. tonight, guys. >> all right leslie, just one of them we're going to watch the connecticut governor's race. thank you. coming up later on "closing bell" how the midterms will impact your money. we have a panel of wall street experts ready to breakdown all possible outcomes, how it could impact the market, sector specific, cross assets 3:00 p.m. eastern time "squawk alley" is all over the market move as well. dow up 92 points on midterm

election day don't go away.

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8:00 a.m. at facebook headquarters in menlo park, california, 11:00 a.m. on wall street "squawk alley" is live ♪ ♪ good tuesday morning i am carl quintanilla with jon fortt. contessa brewer back with us at post 9 this election day full team coverage on midterm elections and how to best position your portfolio. bob pisani has the market covered. julia boorstin has more on facebook's election day test on manipulation, and scott cohn has