watching that and the 10-yr yielding 2.851% is now yielding 28.56% >> but a little leave on the long end and a little bit of a bid to suggest that the s&p is at the bottom of the range here. >> thanks for your help today. join us back here tomorrow everybody, right now it is time for "squawk on the street. ♪ good monday morning, i am carl quintanilla with david faber and jim cramer futures have managed over the over night lows. that's coming off the worse week for stocks in about six months may is going to talk in 90 minutes. the white house is looking for a chief of staff europe is down, japanese gdp was revised lower in that 10-year.

breaking news, we'll go to david. >> thank you, we have breaking news coming out of qualcomm of this ongoing nasty dispute that we have been following closely both jim and i for years now over the patents and of course apple is not paying qualcomm for intellectual property. this dispute around the world and this morning we get a ruling out of the court of the province in china they have granted qualcomm's request of subsidiary of apple the order is to seize infringing upon qualcomm's patents through licenses and importation sales of the 6 and 6-s, 7 and 8 plus now quickly let me move forward to the fact that this appears to

be in dispute. >> riepght. >> people close to apple are telling me in fact they do not view this preliminary injunction in that fashion. they believe it only applies to those phones loaded with ios 11 which is an operating system that the company is no longer shipping its new iphones, ios 12 is where we are right now. therefore, this is a statement from apple that we have for you, they say qualcomm efforts to ban our products is another desperate move by a company who's illegal's practices a are -- qualcomm have served three patents. we'll pursue all our legal options through the court. qualcomm did file 22 cases and six provinces. they did rule on this. this takes some time in china.

they did make this ruling so both parties were aware it is coming as early as last week it appears. jim, you and i and carl were left sort of trying to understand the ramifications of this nasty, ongoing dispute that is scheduled to go to trial early next year, fairly early next year between these two giant companies that of course has resulted in apple's suppliers not paying qualcomm for what it owns on its patents and it is an intellectual. if qualcomm is correct here, you are talking about a company selling $11.4 billion worth of product in china last quarter. an important market for apple that says all my iphone models remain available qualcomm is saying no, you have been enjoying selling virtually all your model in china. >> look, apple, the stocks have

been in a whirl of pain. sometimes you say listen maybe the market knows something, i don't think it knew this my issue obviously is that we don't know how that court system works. for all i know, it is not the end of the world for apple but this is a surprise qualcomm, the bitterness between the two companies, i have not seen it david in a lot of companies. if you take action on this and apple comes out later on with the statement which is basically going to say we are selling them, i think you will regret it at the same time qualcomm has a stronger hand than i know i thought. >> one would think, again i want to get to the heart of the matter here, qualcomm believes if the court is found joint of all the sales of apple iphones in china apple says no, they only do this

applying to those of ios 11 and ios 12 is not included >> apple is saying all iphone models are available for customers. they either sell them or not >> if they have selling them with 12. >> well, that's all. >> if we were in china -- we would not know the answer, right? >> qualcomm says that's not the case and not their understanding of it. there are two functions that's in ios 12 that do apply under the patents that are a heart of the dispute here in this particular court that's ruling now. but, jim, i guess the bigger picture becomes, does it get these two companies closer to settlement we heard different things from different sides in terms of any potential talks. >> apple has come back and report a few times and really

there are no significance talks at the time. >> whether the courts are using this battle to create collateral damage where the cfos are going to have a bail here. >> the notion -- i think you have to understand that ios comes back to china. the courts are controlled by the communist party. if you look at the vend diagram, they control the courts. qualcomm did not check off on this it is punitive i also know that and i just kind of want to peal back of what we are doing as reporters so to speak. we got the largest company, second largest company in the world telling us their phones are for sale and we got the most important interim of not for sale >> as it relate to a potential

settlement, most recent comment we had from apple in court last week there has been unfortunately a lot of articles saying the party is close to a settlement that's not true. he said in fact and we are not engaged in settlement discussions, have not been in many months. that was apple's lawyer juanita brooks that took place in san diego courtroom. they don't agree in anything, the two companies. >> i don't want the let viewers down >> it has come out on the face of it would scare any apple's shareholders >> i think it is a fair statement. >> we'll watch it. thanks to david for bringing it to us first. >> stocks are coming off their worse week in several months sell-off on friday means the snp

has joined on "squawk" on paul jones, he saw more volatility. >> it is really easy to say we are bullish and bearish. i see a two-side of the market >> he later said he'll buy the hell out of ten down he says it seems to be a delay to me. >> i was telling the morning crew that we would be down 20%, okay 20% seriously is where you would buy in a bare market i think we are all stuck with one particular concept this may be only 1987 did we

have the stock market signal being in a hard bare market crash and the economy keeps on tumbling >> the imminent recession story is what i keep on hearing. i could see it there were some data that shows me we are about to have a recession. >> i don't have it >> i have a slow down. >> i have been saying it for a long time. the one thing the fed did mistaking listen is they did not see there could be a slow down there could be and i don't think it is oriented for trades as it is towards confidence. i think everyday you come in is the president going to be indicted or is earnings going to be slashed come on. i said it on air

shoot me >> tudor jones -- >> i am saying the confusion you don't know what's going to happen in washington in the meantime, what do we get? we have a downgrade of fedex today. you downgrade fedex after being down organically because you think things are going to slow dramatically we are just a few days from christmas. >> strange downgrade on fedex, they pin it to management shift that expressed in their view does not happen often disabruptly. >> some early retired guy, a few days before christmas. that does not indicate that a

55 57-year-old is about to get in the hall of fame of fedex. why would you downgrade it if the company is doing so well which you would expect them doing well because they are seasoned this is their make up break season >> meanwhile jim, tudor jones, says no hikes next year. goldman has been at consensus at four hikes next year saying probability is below 50. >> that's helpful. >> mostly on finance right lane conditions >> they adprgree the recsessiony >> there is a fabulous piece about goldman's troubles there is very few clean stories out there where you say okay, i want to buy this look, i worked at apple all weekend trying to figure out what multiples you can put it on it came in at 12 times earnings. maybe your estimate is wrong

you come in and boom, qualcomm gets an injunction of one of their largest markets. you want a possible bottom in apple if it turns out that the injunctions is turned over and everybody has finally sold it and selling it at 11 times that's abbot bottom. it has to be overturned. it has to be >> no sign that's the case >> well, we have been waiting for the party to take action >> i don't really think you can draw -- can you really draw a link to a fujo court province. >> what do you thisnk is jefferson over there >> they are helping another u.s. company. >> you are under mistaken of the

people that's dealing >> you are linking it to the trade? >> shocking >> the fact that we can't say no >> how many amendments over the constitution you got the first over there >> definitely not. >> they have the right to nothing. >> that's right. >> one thing is happening. this happened last week, not today. how do we deal with that >> apparently, it was the end of last month -- both parties were aware. i know this sounds like boots in the ground the stores are busy and open and selling. that i got there are reports showing that and this happens last week so why are they selling it? >> they are not forcing the injunctions or disputes about what the injunctions apply or apple is correct and only ploys to model ios 11 and not selling.

>> what do you think of the time of qualcomm's announcement the ruling was made. why did we not hear about it >> from the court, i am not in touch with the court >> i should be >> i am in touch with people indicate that stores are either open or not. they're selling all models >> it is getting all late in beijing. >> it is murky the idea that the courts are some how that you have judge kicking around -- yeah, i don't think so okay i don't think so >> when we come back, what elon musk says about the sec during a 50-minute interview. theresa may, will she try to have this vote pulled tomorrow will she go back to vancouver?

"squawk on the street" is back in a moment. e ni istmas, and all thro' the house. not a creature was stirring, but everywhere else... there are performers, dancers, designers the dads and the drivers. there are doers of good and bringers of glee. this time of the year is so much more than a bow and a tree. (morgan vo) those who give their best, deserve the best. get up to a $1,000 credit on select models now during the season of audi sales event.

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. elon musk making some eye opening comments which aired last night during 60-minute. in connection with his tweet and his settlement of that agency. >> i do not respect the sec. i do not respect them. >> you are abiding by the sed lme settlement, are you? >> a lot of his tweets were not vetted he would consider buying omnivore soft these gm factories, jim >> yeah, there is a guy by the named jay clayton who's the chair of the sec i have to believe that the head of enforcement calls him and says you may not respect us but

you better do what you agree to. this man plays by no rules he's his own worse enemy i don't understand why anyone would do this. it is an american company. we have a rule of law. i found it is surprising that he clearly believes that he's above the law. >> what i found myself wondering is he has a new chairperson, is there a phone call that takes place or took place because maybe she was aware when they taped it >> what is that conversation >> didn't he make a mockery of her that she's a serious person. she's not in charge. the government does not buy it at all >> what kind of rule is he playing on >> we are waiting on the independent directors who they have chosen for that, as part of the settlement with the sec that

we reported on some time back. clearly he's chasing at it and stillangry about it. >> i am getting pictures of phones being bought in apple stores right now >> in china? >> yeah, in china. >> it is a developing story. >> breaking news >> we need to have cook over there. >> that's a death match, i am not going to be responsible for that situation i am not going to put myself at risk between the two of them >> get this over with. >> we'll get cramer's mad dash and count down to the opening bell take a look at the busy market here on this busy monday we'll be back in a moment. alerts -- wouldn't you like one from the market

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. seven minutes before we get started with trading here. yelp featuring this morning's "mad dash. they are unhappy with the stock. they are saying they need some new board members, yelp has come out, they rarely comment the quarter was really terrible. it is part of the whole world of

social media and the new yellow pages. they are all under assault on friday, facebook's announcement of 9 billion. this is a belligerent quadrant they are under investigating and being able to avoid the hate category and trying to block that this is the most desperate i have seen yet. but, everyone is kind of -- give me a break >> i don't know this firm you are referring to >> they fell 4%. >> we know 4% is not enough to do anything. >> or dollar amount given the small market cap of this company. >> i loo i cike the metaphor ofs i can't believe how badly i am doing. i am going to send a letter. >> right >> instead of selling it

if i were those guys, shoot, i am going to sell it. because it is very new world to just -- hey, i got 4% and i want changes. that does not really work. you know it? >> yes >> eliot is in effort. >> including his travel report >> we'll get to through the opening bell >> very exciting morning send us your apple pictures. >> send us pictures of people buying iphones in china. now i'm thinking...i'd like to retire early.

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(dog barking) whatever your financial goals are, a u.s. bank wealth management advisor can help make them a reality. talk to one today. u.s. bank - the power of possible. you are watching cnbc's "squawk on the street. opening bell in about two-minutes. busy monday and busy week. we are going to get cpi and retail sales on thursday and some pmi as well a lot of action happened before we woke up in the u.k. powell did an 18-month low and theresa may is going to speak about 10:30 east coast time about whether or not there is a vote here for brexit tomorrow or not. >> yeah, this is just total chaos watching withis morning o

the five different options seeing the pounds going down the chaos over there must be mind numbing you got so many different options. it sounds like she lost control of the story line. i don't want to do on the pound and i don't know what else to say. the pounds seem to be the pinata currency right now at one time the world's strongest. >> and even some of her allies would rather have the vote and get this thing done. brussels have said we made a deal and you gate paet a pass. >> how bad is that with a hard brexit >> i think we consistently over estimated the impact of brexit on us. we consistently under estimating china. i think china is just looming and looming because of -- look

because of international companies and in the meantime we have oil going down constantly after an opec meeting oil goes back down. >> oil is down almost a bucket and a half there is the opening bell and the s&p 500 at the cnbc's realtime exchange. global advisories celebrating the installation of that fearless statue right outside the building we'll show it to you at the nasdaq, ctrip.com celebrating their anniversary. we'll watch for qualcomm >> we'll try to make more sense as we move along the news itself we'll share with you at 9:00 a.m. qualcomm granted a preliminary injunction against apple in china. this court, interimmediate

people's court acting on its finaling and qualcomm, this is when you know that actually issued an injunction they say it applies to all iphones. selling them all and importing them and offer for sales in china. that would apply to anything being sold on the internet, too. >> apple responds by saying oh no, that's not the way we understood the dispute we understood it to mean or to be dealing specifically with ios 11 not ios 12, for example, which is the new phones are being shipped withand therefore we continue to sell >> what province is that of the court? >> the apple store and excuse y

mm my -- >> i don't know if they are doing that in violation of the injunction because the injunction does apply throughout china. qualcomm says they believe the injunction is the heart of this. ios 12 is not clear with them. >> there is panic in apple apple was up early in the day. there was a critical piece and still one more firm cutting a number this morning. we got this news that data broke at 9:00. >> it took it at 200 >> there is a foot race down no one is taking a $13 number away from next year. that's kind of where things are. >> they sold $11.4 billion was a

revenue number from apple in china, greater china, last quarter. >> qualcomm release is just her and not there. >> i love to see and find the language >> it does not seem right. that's an interpretation in terms of what it applies to. ongoing dispute between the two companies which apple basically says listen, we raise the price of iphone, you qualcomm wanted a larger number because your percentage stays the same and numbers kept ongoing up. we are not paying you what we don't believe necessarily adding to the value that dispute its ongoing and between the apple supplier and they're operating agreements with qualcomm on which they are

not paying and qualcomm have suite th sued them around the world and ca qualcomm is getting sued in korea. >> the one in america is san diego. >> that's kind of a home team. i need to know steve mollenkopf, this is really going to be naked reporting here steve, you have my number, give me a call, all right > >> the ceo >> is that all right steve watches the show, steve mollenkopf, give me a call >> you want him to call on your phone? we mentioned the fdx downgrade over bank of america fedex is below 200 for the first time in about a year and a half. it is shattering i was just shocked at this fedex is a company that'

that's -- they run a conference call and each person speaks. only nike does the same thing. this person cunningham was a powerful person. it is hard for me to believe that fedex is handling christmas well if they just made this change now, ups is not handling the christmas season well. this is a little choppy. this is something we are all getting used to. stock is down at 175,000 shares. that's a major american company. major american company i question whether that can last but i do know everyone is down >> it is just down i can't believe it >> on the flip side, guys, facebook with that $9 billion by back on top of the prior 15. that's going to take it back above 140 which is been a

critical level according to some >> it is an aggressive buy back and it is 2.2% of the company, that is company that i think many people have given up on when you talk about the company that really crushes people in the market, apple and fedex. these are just bear market moves. if youbought facebook when it came public and some more on the way down, you are still sitting pretty we saw facebook really high and apple really high. do you decide that warren buffett is wrong and throw all of that out and theservice revenue fee. it does not matter because you cut the price target verses what you said about the wearables people don't know. people have such big gains they don't want to take them but hedge funds and then there is ten different etfs that controls

faang. it is pushing down the stocks. so we are really in a mode where nobody seems to be calling bottom there is facebook saying here is the bottom this is it can it hold? apple has been buying share after share presuming the biggest buy back ever has not meant that much. >> no, i think he keeps on doing it a little bit lower today. >> with a growth rate that exceeds that >> well exceeds. remember they acsaid listen, we are only going to do 20% growth. they are bullet proof and will not go down. >> we have other companies like the cloud king, service now. they're selling it at multiples. we have not mention defense stocks >> apple is down 1.5% on the

news conceivably that they can't sell any iphones >> i am getting a lot of pictures >> guys, there is a deal we should get to. it is no merger monday, we did have a 4 plus billion dollars deal jim referenced it earlier when he talked about eliot. they go by evergreen in their private equity uniform $4.4 billion it extends until january 23rd, often we see this in private equity deals, does not mean anybody is going to come this has been around for a while. there has been reporting on it and hence not too big of a jump of the stock price that traveled this morning they also reaffirm guidance. it is interest to know eliot is so much of activist and pe point

another name that eliot ended up making 160 we got the background of that transaction last week and how it came down, down, down. they were there at the end to potentially be a buyer narcanic is another one that we talked about we don't have much of an update for you right now in terms of where things stand there again, what would be there, probably the largest single private equity deals we have seen quite some time although there is no shortage of rumors out there involving large equity deals there are still multiples that they can stomach but trave travel -- not a small deal, $4.4 billion, guys >> as far as china's trade goes. we may get ad delegation to

washington, d.c. next week or so a discussion when they may start purchases. we got the g-20 so to speak, truce. we got the powell pivot and some trading saying maybe 26-30 does get boggught here or should get bought >> if we can prove that the apple store is not real. >> if the huawei cfo is released and if we get this delegation and the chinese put a purchase on paper then what >> then you have like the binary notion of what paul tudor jones is talking about there is a huge con ssensus tha we can have a recession. i am thinking that the stocks are wrong but everybody who has thought that have been denying it there is so many companies yield

4% accidental high yield as i call them those are bought a lot of retailers >> do you know there is only two injunctions in china ever and last one was five years ago and also in that province. i know it is not fake news it is diplomatic >> trump would be tweeting about that skrjudge. get rid of that. >> tariff man. about 2% >> did you painted on tariff man. >> how about larry kudlow saying it is a soft deadline. >> and people want to know why the market is crummy >> how can anyone trust the m k market when the chief economic adviser saying it is hard.

>> you got to figure out who you want to fall to when it comes to communicating we are getting out of the administration. i am sure you would want to fault to lighthizer. >> he's leaving. it is ridiculous that we are discussing this? >> unless he takes chief of staff and "politico" is saying he's sending signals he does not want there is a lot of tea leaves >> they have an untraditional white house. >> right >> i think your point is well-taken it is important to communicate on one voice on these kinds of issues it would seem there is a benefit on that. >> i am going with carl's idea that it could be totally whacko if we just pin down this apple injunction >> on this spending headline, yep? >> we got micron going up on this severe estimate cut we have facebook ebuy backs

playing some roles n nvidia is up four bucks. that's a god's send. david? >> yes top three s&p gainer right now, lockheed and raytheon. let's get to bob pisani. >> we are sort of positive or negative here early in the morning. take a look at the sectors modest news up in some of these se se semikuk semiconductor names despite the apple news healthcare is on the flat side that's the new market leader we watch it carefulfully energy after trying to rally last week, oil is down about a dollar so energy stock is on the weak side. where are we we are at the low end of our trading range.

figure 20. oh, there is aerospace and defend stock these guys were all at 52-week lows last week it is nice to see them bounce a little bit today let's talk about where we are and see if we can put up the s&p 500. we are at the low end of our trading range. 26-32 was the closing lows and in fact on november 23rd right after thanksgiving, we are sitting right there and right now. the highs, 2800 the last couple of months. we are at the low end of the trading range. everybody kept talking about the weekend is the market is reacting a lot more to negative news and emphasizing the negative news than the positive news there are positives out there. i saw two or three positives last week, number one, there is definitely signals from everybody over at the fed. the probability of more rate hikes is less than fewer rate hikes. that's a good news there was a delay in the tariff implementation, i know there is confusion about it but i thought there was a positive

the opec production also to me was a bit of a positive. i saw several market positive. the street did not emphasize any of that. we saw emphasis on the negatives last week. china's number as and trade numbers were definitely weak there is some kind of slowing going on there trades gave mix signals, lighthizer verses kudlow and peter navarro and brexit is confusing. we are trying to resolve that. to what extent the mueller's investigation may weigh on the market i don't think it has yet but given the flurry of news, it is possible it could be some political jeopardy for the president as well a lot of mixed signals here overall. we are turning to christmas. nobody wants to talk about christmas sales but i tho uught bank of america had an interesting note they saw sales up 3.5% year over

year ending cyber monday usually we are expecting 1% or 2% gains retails have been awful, we saw new lows at tiffany and automati autonation, we are looking at zombies here, l brands was positive and kohl's. the dow is down 44 points and remember apple is a big part of it >> let's get to rick santelli in chicago. good morning rick. >> good morning carl, the fixed income market has paid a lot attention the last couple of weeks to volatility. as you look at oneweek chart o tens, we see that we stopped at the 182 level and opening chart up to early august the last low we had before we established our high yield close

of the yield around 324. you guessed it, it is 281. it represents the midpoint range of the year. there is a lot of technical issues the difference of 30 and 10s widen dramatically if the 30-yr comes down it is at a much higher level technically than the tens. that made some traders nervous at the face of support we see that twos are up and 30s are down two that threat is flatten a little bit along with tens to twos, trading around 2 if we look at high yields and investment grades and look at the etf and many people talk it is an area to pay attention to let's put it in perspective, barclays investment grade security index, it is certainly has widen as it turns out. it shows you how much of a

greater in context of things i don't under estimate how the influence of those outside the best credit in sovereigns and those with the prints press when they start to widen but it has been much wider at various points of volatility the dollar index is up it always seems to hold on the 96.5 level finally, since mid september when everybody was volatile, we see the dollar index holding an improvement. carl, jim, and david, back to you. >> rick santelli, as we go to break, let's take a look at our top performance name on the dow. microsoft and intel are among the gainers. we are back in a minute. ♪

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fearless girl statue has a new location it's in front of the new york stock exchange, reinstalled earlier this morning state street global advisers originally placed the statue at bowling green on the eve of international women's day last year the firm says the statue symbolizes the importance of gender diversity in corporate leadership that's kind of a big deal. you don't get a lot of changes outside a historic landmark like this one. >> not at all. i thought the trust fund -- he asked a good question, how many companies have -- just going right through and looked at gender pay, i remember when marc benioff did salesforce, he looked at it and changed everybody's pay. so the idea of gender pay if this helps that is terrific. terrific. >> maybe take some cameras outside later on in the morning. in the meantime, the dow is down 200 points. back in correction territory

apple down 2%. we'll get stop trading with jim after a short break.

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♪ there's no place likargh!e ♪ i'm trying... ♪ yippiekiyay. ♪ mom. ♪ let's get to jim and stop trading. >> consolation brands is

emblematic of this market. there's a piece out by jefferies saying they have -- a little north of 50% of canopy and they're saying listen, you're not getting credit for their move given the fact how canada is selling a lot of recreational consolation will be on the recreational side of that, canopy will be medical but the stock won't stop going down. it's modelo and corona and it won't stop going down. there's a lot of stocks like that i'm getting there was no one reported in china, that ruling hasn't changed that's from apple so you can say take that with a grain of salt but this is a very confusing story and the market remains difficult to fathom. >> it was last week that rosenblatt took their target to 165. we're there on apple. >> apple is the underpinning of this market. it's the individual stock that

is the hallmark. you'll have to have someone come out and say, look, this is an opportunity. health care stocks are away from apple but it's the most skittish i've seen in a long time. >> tonight >> we have splunk. they had a monster positive quarter. and rich hume from tech data. >> we'll see you tonight, "mad money" at 6:00 p.m dow down 199 intel, ibm, microsoft, ccois are the only components in the green.

♪ where's the love good monday morning. welcome back to "squawk on the street." i'm carl quintinilla with sara eisen and david faber at the new york stock exchange. dow down almost 200 to start the week as regular issues are front and center this time it's may and brexit. the huawei cfo in vancouver, china, trade, the fed and more.

as you can see, stocks slipping lower as investors fear an intensifying trade war between the u.s. and china apple takes a leg lower after qualcomm wins a court order. british prime minister frame is getting ready to make a statement this hour. will she pull the brexit vote scheduled for tomorrow wilfred frost will join us from london on that and the fear factor steve liesman looking at how market swings are impacting economist projection on fed rate hi hikes. but we'll start are rick santelli and the latest economic data. >> we're looking far read on october job openings and labor turnover known as jolt 7.079 million. this is the fourth number in this data series that has seven million or higher handlement it's the only time in history that we've had seven million the first one was in july.

this is the second-highest ever so we continue to monitor that in certain areas the feel-good indices and the jobs numbers maybe avoiding what we saw last friday seem to be very powerful. the response in the marketplace is nil as most investors continue to concentrate on the volatility that emanates from global equity indices. carl, back to you. >> thank you, rick santelli. let's get to steve liesman looking at how economists are digesting the big swings in the market good morning, steve. >> not well is the answer. some economic commentary turning more pessimistic in response to changing fundamentals but partly in response to the market selloff itself over at hfe, global economist carl wineberg writes an economic downturn threatens every country we monitor we worry that darker days of coincident economic downturn lie on the horizon

the stronger global growth expected to fade as those countries slow the trend trade tensions are a continuing source of worry and the market selloff creates its own reality. one jayne mort.p. morgan indica middle chance of recession but when they factor in market signals it jumps to a high of 36%, signals like the stock selloff and flat yield curve trade tensions having that negative outcome few see it as positive j.p. morgan writes growth and momentum have slowed but recession risks remain modest. the message from activity indicators is at odds with the far more negative one coming from global financial markets and some economists pushing back on how much to expect. rdq writes profit, wages and productivity growth remain our key indicators but at this point they give no cause for alarm the fed has long expected a 2019

slowdown, but it's worried the market may signal or help create a worse result so amid this uncertainty look for the fed to slow down until the fight between the bearish market and more bullish economist is decided, carl. >> steve liesman watching the economic trade winds today major averages close to the low of the session, rull 2000 moves closer to bear market down 17% from the 52-week high. joyce chang is here along with sean matthews, now chief executive at capital management. good to see you. joyce, what do you make of these relatively benign economic signals when you contrast it with the transports with their worst week in several years, for example? >> i think you have a couple factors in place you have poor market liquidity and concerns of the geopolitical noise. will a meeting take place, will

you see concrete announcements come out then you have brexit noise so you have a combination of geopolitical risk and market liquidity concerns that are weighing on the market right now. >> which is the most important to listen to >> i think geopolitical risks are the ones that will guide the market this week but market liquidity points to the market turning upwards. overall growth we think remains above trend in 2019. we've had just high of 3% so it's not the growth story or fundamentals, i think it's confiden confidence. >> sean, sounds like off different view you think the market will peak >> i think when we look at the marketplace it's a credit bubble we have a massive amount of leverage created in the system that has to come out and as we think about the world, we've had credit bubble after credit bubble the last 20 years

now this won't be as bad because you don't have the same leverage characteristics but there's a fair amount that will have a tough time rolling their debt. >> are you worried about credit spreads? are you seeing any sign of weakness >> the credit market is seeing some concern i think you'll have a tradable rally in credit because people will move out of the equity market and look for safety and we've been conditioned cash is not an asset class, which is crazy. i think it's a great asset class but most people have been conditioned it's not so people will look to go up the cap structure into credit. in the second half of next year there will be problems >> city has a note out, a narrative of vulnerability will pervade the u.s. corporate bond market in '19 as an array of mighty u.s. non-financial companies take their turn in the barrel does that sound right?

>> you'll see more ratings downgrades next year i don't think the rollover problem is that big in 2019. as we look to the second half of 2019 if fed policy becomes more restrictive, the immediate indicators are pointing to an excessive pricing of risk premium at this stage in our opinion. but you will see ratings downgrade. the leverage hasn't built up at 2008 levels. we think the rollover needs are manageable but you'll see underperformance of credit continue into next year, i think catch will outperform credit. >> is it your view the stock market is overreacting >> the stock market is overreacting we have earnings growth for next year at around 8% but they're looking for positive momentum and catalyst so the trade discussions with china are front and center for this week's news also the friday prints and how they come out but market

liquidity has been driving stock market volatility. >> two weeks ago everyone was talking about rate hikes in december and a few next year now the chatter is maybe one and done doesn't that change the entire outlook on the markets next year >> not really. one and done is because the demand picture isn't good. so if we think about the world, they're doing it for a reason. i think it goes back to celt and credit is the key component. the two things that have to happen for the economy to do well and the equity market, productivity has to go up, that has to be a story that continues and spread spins have to normalize so people can feel comfortable getting back into the marketplace. there will be tradable rallies here and there but the theme is in place for the next year or two. >> but i want to -- explain why you're worried i haven't heard the reasons underlying your concern for

credit. >> you look at 35% of the companies out there aren't making money they have debt in position, it will be tough to roll. when you think about it, duration is a significant part of a corporate balance sheet no one thinks about so we had rates back up from the lows we had 150 basis points, so that's an issue. credit spreads were tight because rates were low so there's correlation there as well so if we think about high yield which is a place where at some point in time in the cycle it becomes an equity-like investment, that hasn't been thought about for years and years. then we get into the leverage loan market which is bigger than high yield market and there is more leverage there than in the high yield market so you have a levered environment caused by low interest rates. >> is that more of a russell story than an s&p story given the number tied to labor >> that becomes a problem as

energy pries go down as we think about credit, credit is something that once it loses confidence on the lower rung it slowly moves higher so you'll pay more for your debt no matter what and it will be harder to come by. >> finally, on the fed a couple months ago they said it was an extraordinary moment, almost too good to be true has their credibility taken a hit or not >> i think you should expect the fed to hike here because the fundamental indicators haven't shifted that much even though sentiment has shifted. so i don't expect the fed to pause that the stage. >> but financial conditions have tightened so much. >> but you're looking at the length of this expansion the longest expansion in post world war ii history but just shy of the longest since 1860 so some market correction isn't that surprising. i think some of this is technically driven and the fundamental data hasn't shifted as much as the sentiment. >> joyce, sean, please come back

soon the sooner the better. thank you very much. >> not helping overall sentiment, you heard joyce mention it brexit clock ticking we're expecting to hear from theresa may this hour, our wilfred frost is live with more on what we can expect to hear and what we can expect afterwards which is very unclear, wilfred. >> absolutely right, sara. in 20 minute's time we expected the prime minister to announce she is delaying her seminal vote on her brexit plan which was planned to be tomorrow the british pound has fallen on the back of this news. why? because it's confirmation the prime minister herself lost confidence she could win the vote on her brexit plan and with that her middle ground plan for brexit seems to be at least temporarily dead in the water. her opposition have pounced.

jeremy corbyn said the government decided frame's brexit deal is did sasastrous i taken its own vote while jacob riees-mogg said i knew she should go this proves my point so despite the fact that they say there's no further room for negotiation, prime minister theresa may will attempt to do just that if she fails she may face votes of confidence whether triggered by her own party or opposition party that's why the british pound is at a one and a half year low, lowest point since june, 2017, down .75%. >> i'm going to send you a shopping list to go over to liberty london and get some deals.

the guess the question besides her own leadership after this vote presumably fails is what happens to the brexit divorce talks? is there a possibility we could get a second referendum? >>. >> certainly a rising possibility so much so j.p. morgan changed their expectation of no brexit at all from 20% to 40% just last week and the european court of justice ruling this morning that allows the uk to unilaterally call off brexit without further approval needed from the eu continues to slightly increase that chance. nonetheless, the default remains no deal on march 29 so there is a very binary possible set of outcomes if frame s if theresa i deal fails a vote. so it's open at the moment the one thing for certain is that her current deal which, if passed, probably would have led to a rally, doesn't look likely

to past and that's the weakness we're seeing now. >> we'll talk to you in a few moments. when we come back, the battle continues china grants qualcomm an injunction against apple we have details and break down what will that will mean for the sales of iphones in china. and we'll look at the top performing names on the s&p, we have 52 week lows on bank of america, j.p. morgan, morgan stanley and capital one. ♪ there's no place like home ♪

argh! i'm trying... ♪ yippiekiyay. ♪ mom. ♪

we've been following that on going dispute between qualcomm and apple. qualcomm providing certain patents and intellectual property into all phones but iphones as well. not being paid by apple suppliers. that's been going on for some time they're meeting in courts around the world. in san diego, the trial expected to start in the early part of next year but important news out of china that investors are trying to grapple with given what again is two different stories from the companies involved let me give you the story itself as a chinese court has granted an injunction against apple and qualcomm has brought 22 separate

cases in six provinces in china over this basic dispute they're having with apple but in this case one has granted qualcomm an injunction, banning the sale of basically what are all iphones other than the very latest, the newest model apple says that's not the way we read it. the way we read it is all iphone models that include ios 11 are banned from sale but not the ones we're shipping now which are ios 12 and therefore they're saying all iphone models remain available and investors are trying to understand what that means and that what will happen from here. qualcomm for its part would say -- and our reports are that apple continues to sell phones

in china at this moment in stores and over the internet and any description channels but qualcomm would say listen the court was not focused on which operating system it was but the functions of the patents that were being infringed and if you have a phone doing those same functions now, whether it's running ios 11 or 20 or being sold with those operating systems that is infringement, that should be enjoined and for what it's worst, as i'm sure our viewers know, apple sold about $11.4 billion worth of goods in china last quarter most of that iphones so it's a very important component of overall revenues you have to view this in the overall totality of this ongoing and vicious dispute between these two companies and as always it's hard to parse exactly what it is now you can make an argument

that if investors believed apple was unable to sell any phones in china, the stock would be down more than 1.4% that said, if qualcomm is correct, there are actions they can take to get the injunction enforced and perhaps they'll do that, my understanding is they would need to go in front of enforcement tribunal and say they're not enforcing the injunction. >> this is clearly a huge deal i was trying to look up whether -- so any of these court b actions -- this battle has been going on for a long time have they ever moved to block sales of iphones >> this is the first injunction i'm aware of and jim was saying there's only been one other injunction issued in china in terms of product same judge so it's a rare thing for this to occur and there is a belief, of course, this will add

to the leverage kwaqualcomm has get apple to the table even there are there are disputes there are settlement talks, apple in court in san diego in a hearing that took place recently saying no, there aren't settlement talks, we're going to trial so even there the two sides don't seem to agree on whether they're talking. >> and you have to wonder how this fits into the overall trade rift between the u.s. and china with the arrest of the huawei founder's daughter, cfo. apparently according to the "journal" this decision was made before that. >> apparently it was made as early as the end of november but different things need to happen before it becomes official though it appears qualcomm and apple knew about it last week.

>> chvwhich was jim's point abo why they would choose today to disclose. >> it and that's unclear as to who is on ligated to announce at what time. >> but does it suggest apple is vulnerable in the world's biggest smartphone market, china? >> right. >> people have always worried about that. >> they have with the trade tensions though it's hard to link this to that given the timing. we'll continue to watch market reaction, apple shares down 1.4%. as we head to break, there's the overall market picture stocks slipping. dow is down 118. we're monitoring activity in british parliament where prime minister theresa may is getting ready to make a statement on the brexit vote which is scheduled for tomorrow we'll take you there live as soon as it begins. market-moving remarks coming your way "squawk on the street" will be ghback

stocks are down. 52-week lows on a lot of banks apple shares down 2 and then these fears over an intensifying trade war between the u.s. and china. bob pisani is at post 9.

help us understand that. >> we're sitting at the low end of the recent trading range so roughly we've been 2632 with the old closing low. we are up to 2800 in the last two months so we're at the bottom of that and i think that's troubling because i saw good news last week by and large so what i saw was the most important thing, a whole bunch of fed speakers signaling lower rates. that was the single most important -- not lower rates but that they were not going to -- the path of rate hikes were slower than it was even a month ago. that was the most important thing. second thing, no matter what anybody says, they did declare a truce at least temporarily on the tariff wars. maybe it wasn't good enough for a lot of people but it was a truce. then we had an opec production agreement. all three were positives yet the market wanted to emphasize the negative so you had slowing growth concerns out there, we saw this in china with the export numbers and import

numbers were weaker than expected the tariff message was confusing and the huawei thing didn't help we saw the brexit story get confusing and it is today and i got a lot of questions about this over the weekend. how much is the mueller investigation impacting the market it's tough to figure there's a certain extent trump is believed to be at greater political and legal risks than he was before. i think that's true. the question is is that impacting market sentiment i don't know but one of the things that worries me, one of pisani's laws of broadcast journalism, you know you're in trouble when your best sources call you and ask you what's going on. when they're confused and ask me, i'm worried the market is confused because that's a good barometer. >> if it were impacting the market, it's a market negative >> i think generally to the

extent that imperils the ability to govern or get legislation that might be more market friendly through, it does. >> it's not market friendly now. it's trade. >> to the extend that he may be in trouble anything about his ability to negotiate deals, even something as simple as infrastructure, more chaos isn't what you want we have too much uncertainty around everything. i think let's reduce the list of worries that we have the fed went a long way towards reducing that risk the traffic thing isn't off the table. the slowing global growth is hard you mentioned all the bank stocks at new lows. when you have that as your second and third largest sector,

the entire makeup at 52 week lows, off problem. >> thanks, bob, talk to you in a bit. we're awaiting theresa may in the uk. we'll take you live inside the house of commons we've taken out last week's trayowf 21 alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.

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and accessoriesphones for your mobile phone. like this device to increase volume on your cell phone. - ( phone ringing ) - get details on this state program call or visit hi, everybody, i'm contessa brewer here's your news update this hour. more than 160 countries have agreed on a non-binding u.n. migration accord that seeks to ensure the humane movement of people around the world. despite the outspoken disapproval of the united states and several other countries. >> it is indeed very important to at the same time guarantee the human rights of migrants and

create the conditions both countries of origin, transit, and destination better cooperate respecting the interest of the states and at the same time guaranteeing the human rights of migrants. japanese prosecutors indicted former nissan chairman carlos ghosn and former aide greg kelly on suspicion of financial fraud. they were arrested suddenly three weeks ago. french president emmanuel macron is meeting with local and national politicians, union and business leaders at his presidential palace hearing their concerns over recent violent protests he'll give an address on the situation later today. that's our cnbc news update. let me send it back to you, sara. >> contessa brewer, thank you. welcome back to "squawk on the street." i'm sara eisen with carl quintinilla and david faber live from the pink thafrom the new y exchange we are monitoring london, live shot of british parliament where

theresa may is expected to make an announcement on brexit any minute now there's a vote scheduled for tomorrow on the divorce talks between the uk and the eu. it isn't expected to pass. she may have to shelve the vote. >> the british pound has fall on the an 18-month low. we'll bring it as soon as she begins her speech and we'll monitor the house of commons for you. meantime, the dow is off 200 points major averages coming off their worst week since march dow, s&p and nasdaq down 10% there recent highs, along with the trade uncertainty, a number of red flags for investors the "wall street journal" pointing out what it calls the market's latest problem which is the hesitation to buy the dip it could be a sign investors are approaching selloffs with more caution. then there's this out of the imf. maurice obstfeld said the u.s.

could start feeling a global economic slowdown. before we get to our panel, let's go to theresa may, british p.m. >> i listened carefully to what has been said in this chamber and out of it. [ laughter ] to what has been said in this chamber and out of it by members from all sides from listening to those views it is year that while there is broad support for many of the key aspects of the deal -- [ laughter ] -- on one issue, the northern ireland backstop, there remains widespread and deep concern. as a result, if we went ahead and held the vote tomorrow, the deal would be rejected by a significant margin we will therefore not proceed

with the vote. i set out the reasons why the backstop is a necessary guarantee to the people of northern ireland and why whatever future relationship you want there is no deal available that does not include the backstop behind this argument are inescapable facts, the fact that northern ireland shares a land border with another sovereign state. the fact that the hard-won peace that has been built in northern ireland over the last two decades has been built around a seamless border. and the fact that brexit will create a wholly new situation. on the 30th of march, the northern ireland/ireland border will, for the first time, become the external frontier of the european union's single market and customs union.

the challenge this poses must be met, not with rhetoric but with real and workable solutions. businesses operate across that border people live their lives crossing and recrossing it everyday i've been there and spoken to some of those people they don't want their everyday lives to change as a result of the decision we have taken they do not want a return to our hard border and if this house cares about preserving our union, it must listen to those people because our union will only endure with their consent we had hoped the changes we've secured to the backstop would reassure members that we could never be trapped in it indefinitely i hope the house will forgive me if i remind them of those changes. the backstop no longer splits our country into two customs

territories. this means the backstop is now an uncomfortable arrangements for the eu so they won't want it to come into use or persist for long if it does. both sides are legally committed to yieszi iusing best endeavors the end of the implementation period, ensuring the backstop is never used if our new relationship isn't ready, we can choose to extend the implementation period, further reducing the likelihood of the backstop coming into use. if the backstop does come into use, we don't have to get the new relationship in place to get out of it. alternative arrangements that make use of technology could be put in place instead the treaty is now clear that the backstop can only ever be temporary and there's a determine nation force but i am clear, from what i have heard in this place and from my own conversations that these elements do not offer a sufficient number of colleagues

the reassurance they need. [ laughter ] i spoke to a number of eu leaders over the weekend and in advance of the european councilly see council , i will see my counterparts in other member states. i will discuss with them the clear concerns this house has expressed. we are also looking closely at new ways of empowering the house of commons to ensure any provision for a backstop has democratic legitimacy and to enable the house to place its own obligations on the government to ensure that the backstop cannot be in place indefinitely mr. speaker, having spent the pest part of two years poring over the detail of brexit, listening to the public's ambitions and, yes, their fears, too, and testing the limits of what the other side is prepared to accept, i'm in absolutely no doubt this deal is the right one. it honors the result of the

referendum -- >> the remainder of the statement must be heard and i invite the house to hear it with courtesy and for avoidance of doubt and also the benefit of those attending to our proceeds who are not members of the house i emphasize that as per usual, i will call everyone who wants to question the prime minister. but meanwhile, please hear her the prime minister. >> it honors the result of the referendum, it protects job security and our union but it represents the best deal that is negotiable with the eu i believe in it, as do many members of the house and i still believe there is a majority to be won in this house in support of it if i can secure additional reassurance on the question of the backstop and that is what my focus will be in the days ahead. but, mr. speaker, if you take a step back, it's clear this house faces a much more fundamental

questi question does this house want to deliver brexit [ shouts ] [ laughter ] and a clear message from ismthem but if the house does, does it want to do so reaching an agreement through the eu if the answer is yes -- and i believe the answer is that with the majority -- we have to ask ourselves where we're prepared to compromise because there will be no enduring and successful brexit without some compromise on both sides of the debate. many of the most controversial aspects of this deal, including the backstop, are simply inescapable facts of having a negotiated brexit. those members who continue to disagree need to shoulder the responsibility of advocating an

alternative solution that can be delivered and do so without ducking its implications so if you want a second referendum to overturn the result of the first, be honest that this risks dividing the country again. [ shouts ] be honest this risks dividing the country again when as a house we should be striving to bring it back together if you want to remain part of the single market in the customs union, be open this would require free movement, rule taking across the economy and ongoing financial contributions, none of which are in my view compatible with the result of the referendum and if you want to leave without a deal, be up front that in the

short term this would cause significant economic damage to parts of our countly who can least afford to bear the burden, i do not believe any of those courses of action command a majority in this house but not withstanding that fact, for as long as we fail to agree a deal, the risk of an accidental no-deal increases so the government will step up its work in preparation for that potential outcome and the cabinet will hold further discussions on it this week. the vast majority of us, mr. speaker, accept the result of the referendum and want to leave with a deal. we have a respond to discharge if we will the ends, we must also will the means. and i know that members across the house appreciate how important that responsibility is and i'm very grateful to all members on this side of the house and a few on the other

side who backed the deal and spoke up for it. many others i know have been wrestling with their consciences, particularly over the question of the backstop seized of the need to face up to the challenge posed by the irish border but genuinely concerned about the consequences i have listened, i have heard those concerns and i will now do everything i can to secure further assurances if i may conclude, mr. speaker, on a personal note on the morning after the referendum two and a half years ago i knew we had witnessed a defining moment for our democracy. places that didn't get a lot of attention at elections and which did not get much coverage on the news were making their voices heard and saying they wanted things to change i knew in that moment that parliament had to deliver for them but, of course, that doesn't just mean delivering brexit, it mines working across all areas, building a stronger economy,

improving public services. tackling social injustices to make this a country that truly works for everyone. >> the prime minister must be heard. the prime minister. >> tackling social injustices to make this a country that truly works for everyone, a country where nowhere and nobody is left behind and these matters are too important to be afterthoughts in our politics they deserve to be at the center of our thinking. but that can only happen if we get brexit done and get it done right. and even though i voted remain, from the moment i took up the responsibility of being prime minister of this great country i've known my duty is to honor the result of that vote and i've been just as determined to protect the jobs that put food on the tables of working

families and the security partnerships that keep each one of us safe and that's what this deal does. it gives us control of our borders, our money, and our laws it protects jobs, security and our union. it's the right deal for britain. i'm determined to do all i can to secure the reassurance this is house requires to get this deal over the line and deliver for the british people and i commend this statement to the house. >> jeremy corbyn >> thank you thank you, mr. speaker and i thank the prime minister for a copy of the statement before we met here this afternoon. we're in an extremely serious and unprecedented situation. the government has lost control of events and is in complete disarray it's been evident for weeks that the prime minister's deal did not have the confidence of this house yet she plowed on

regardless, reiterating this is the only deal available. can she be clear with the house? is she seeking changes to the deal or mere reassurances? does she therefore accept the statement from the european commission at lunchtime saying that it was the only deal possible, we will not renegotiate, our position has not changed. ireland's taoiseach said it was the prime minister's own red lines that made the backstop necessary so can the prime minister be clear? is she now ready to drop further red lines in order to make progress mr. speaker, can the prime minister confirm that the deal presented to this house is not off the table but will be represented with a few

assurances bringi ining back the same botc deal either next week and in january and can she be clear on the timing will not change its fundamental flaws and deeply held objections right across this house which go far wider than the backstop alone. mr. speaker, this is a bad deal for britain, a bad deal for our economy, and a bad deal for our democracy. our country deserves better than this. >> the cheering and jeering of the british parliament can be entertaining but the big headline there as far as the markets are concerned is that the vote for brexit that was scheduled for tomorrow has been delayed by prime minister theresa may. we're listening here to opposition leader jeremy corbyn respond but she said that they didn't have the support and she got mocked or rudely yelled at a few times when she said there is

broad support for the key aspects, they laughed at that. she talked about northern ireland and the border and how she said that we need to listen to them in moving forward with this wilfred frost, where do we go from here? >> well, just to recap some of the key points that this vote that was scheduled for tomorrow on her brexit plan has been delayed. she said she spoke to eu leaders over the weekend and she go immediately to speak to them ahead of the eu cancouncil scheduled for thursday and friday it's not clear how long she will make that statement. then we got the same arguments she's already used to reassure mps to vote for the deal including saying "i'm in in doubt this deal is the right one. that led to the question from the opposition leader jeremy

corbyn of whether she is going to seek and get changes to the actual text of the withdrawal agreement or get verbal assurances from eu leaders that they don't want the irish border backstop to kick into places if she can get legal changes to the text perhaps that will placate the dissatisfaction from the northern irish dup members, the the brexiteers in her own party and get them to support her. if not -- and she'll give answers on this topic right now, she faces the threat of potential votes of confidence in her leadership whether immediately orb whether she bring this is back sterling is down 0.8% because of this, guys. >> but the rhetoric coming out of brussels, at least today on that front hasn't been reassuring to the may camp, right? >> absolutely right. unequivocal whether it's from individual leaders like the irish prime minister or from the eu commission itself saying

there can be no changes to the withdrawal agreement the leader of the dup, that's the democrat union party from northern ireland, eileen foster who supports the government to allow them to function day to s she released a half hour ago that the prime minister must get changes to the legal agreement around the irish border, otherwise they can't support the prime minister it really rests on that. if the brexiteers don't believe she can accomplish that, they may not wait we can expect threats to her to continue there's been rhetoric on that point. it will depend whether we get to vote or not. that's why we're seeing weakness 126-06, well below 18 month lows we have seen because of threat to her potential to continue

she continues to be incredibly resilient. we have seen her be resilient before, she said earlier in comments ten minutes ago, said does this house want to deliver brexit, it won't happen without compromise on both sides a very fast statement. she's trying to appeal to the brexiteers don't push me or you might lose brexit all together. >> didn't sound like she was going to step down or a confidence vote, always sounding confident. the pound moves to lows of the session, down three-quarters before the speech, now down a percent. u.s. stocks are near session lows as well, the dow down 282, 270. wilfred, do you think this rises to the level, you know, brexit shocked global markets in june of 2016 when the referendum surprised everyone and voted out. how do you put this vote or lack of vote in context with that,

and how big a deal it is to global markets and the global economy as we try to figure out what it means for the u.s. >> reporter: i'm looking at bank stocks barclays down 3%, deutsch over 3% some stocks are heavily tied to this result. we are looking at u.s. banks in the session. i remember speaking to senior ceo at one of the six banks off the record he said i would be very surprised if any of the u.s. banks weren't prepared for eventuality of no deal it will cause volatility as we're seeing in british risk assets, but the u.s. investment banks say they're prepared now, a lot will rest for uk banks like barclays, hsbc and others if we don't get terms that allow them to continue to operate as they are. i think the potential infection across u.s. markets won't be fundamental, it will be things like correlations between equity

markets. correlations can have a big effect on markets on individual days >> with the dow down 330 points now, wilfred, thank you very much see you through the day. it is getting dramatic by the hour let's get to the overall stock market here. session lows, with us global head of exchange traded funds dan draper and bear chief investment strategist bruce b bittles. how deep is the brexit uncertainty for u.s. equity investors? >> i think it is part of the overall problem. i think the markets are struggling, trying to price in new developments, and those being that the global economy is in recessionand that appears t be worsening the slowdown in the u.s. economy, what it means for corporate profits, i think we're

going through that adjustment now and it is likely to continue as we enter the new year >> dan, you agree with that pessimistic take global recession, the global economy is expected to grow 3.7% this year. >> you talked about normally in an economic cycle, the u.s. led growth so far, then you get rotation into developed markets like europe, but not only the uk, look at france and italy i think it is putting pressure, people moving back into dollars, back into treasuries, seen a flattening of yield curve. still seeing good earnings the ism, key indicator, from a cyclical high of 61, we're still 58, 59 doesn't indicate pull back or recession. short term people are trying to figure out what the market will do >> dan, another six month low as

we're at 2600. people talked about 2640 or 30 being a level to defend. what happens if we slice through this >> then you have to look at the policy, bob pisani mentioned we're right on the low i think you have to reassess looking to 2019, the impact on earnings and on the consumer side, if you look, we got off to a good start with consumer spending costco, plus 9% same store sales. on the other hand, decelerating home prices. if we breakdown through 2600, fundamentals continue to become questionable, then you have to think in 2019 about estimated earnings estimates >> bruce, if there's success in trade talks with china, what is that going to mean for the market >> i think the trade talks with china are much more complicated than just an agreement on some

local tariffs. that's going to be a long term development, i don't think it will have real influence on the markets in the near term with that said, most of the foreign stock markets are down equity markets are a good indicator of growth. china is down 20%, now the u.s. has joined that downturn, that's what suggests to us that the global economy is in recession or on the verge of recession u.s. we don't think is going to enter recession. we think there's a slowdown here, but that's going to influence corporate profits. what we don't like here are technicals we think volatility in the market is likely to serge. we believe the market is plagued

by a strong, persistent down side momentum, and until that he is broken, i think the markets remain vulnerable. >> guys, we'll leave it there. thank you both for weighing in we secession lows, dan and bruce. -- we see session lows dan and bruce. tomorrow morning, wilfred is in london, we're putting you all in charge. closing bell, james quincey, new chairman coming in from coca-cola. -- for coca-cola quk le is coming up after the break with the dow down 300

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