we're going. final trade. >> it's a 1.5% return ikhang >> i want royal dutch shell, 1.3 times book. >> you can find opportunities i think in netflix >> great weekend "power lunch" starts now >> the bears are out again trying to add to fears about a global economic slow down, how worried should investors be. and shares of j&j plummeting beijing suspends tariffs on car imports. remember yesterday we told you about robin hood launch checking and savings accounts with 3% yields guess what robinhood didn't give regulators the proper heads up about it

"power lunch" starts right now >> welcome to "power lunch." i'm kelly evans. stocks are getting pummelled today. the dow dropping 475 points. the s&p doing the same thing and so is the nasdaq and all 11 s&p groups are in the red. health care and energy are the worst performing sectors in the dow, jean-claude junckohi responsible for those losses and belmont is soaring after they're bought for more than $3 billion melissa. let's get straight to more on the cesell off this hour >> a rough day with today's losses the s&p 500 on track to erase its weekly gains and it's

reentered correction territory, down about 10% from the most recent high. the selling intensified around the european close around 11:30 a.m. east rn the risk to the global growth and on the u.s. economy is the biggest discussion on the floor here and then in europe, flash pmi disappointed auto registrations are down in november the auto industry very important to germany's gdp plus brexit concerns have not gone away. let's give you a sense of where we're seeing the losses. energy back in bear market all 11 s&p 500 sectors are trading in negative territory. the dow losers j&j the biggest on the dow that routers investigation, the stock on pace for its worst day since 2008 a number of financial names,

bb&t, b of a, in terms of what's working, bell mond moving higher, duke energy. dow currently down 430 points. >> thank you a mix bag of news from china today on the plus side the government offering to temporary slash tariffs on american products but they also released weak economic data we're in washington with the latest you put these two things together and it looks like china may have a weak hand in the trade negotiations. >> the white house is arguing this is part of their grand strategy tariffs may be causing pain at home but the white house says they're causing more pain overseas and that appears to be bolstered by the economic data we're seeing out of china, retail sales, industrial output falling short. investment growth did top forecasts but still down from

earlier this year. president trump took credit for the slow down over twitter saying china just announced that their economy is growing much slower than anticipated because of our trade war with them he said china wants a big and comprehensive deal, it could happen and rather soon we are starting to see some follow through on the promises made during the dinner at the g-20, china's finance ministry announcing today it's rolling back retaliatory tariffs on car parts they're at 40% and they'll go down to 15% from january 1 to march 31st the next step is a face-to-face meeting. that could take place either here in d.c. or in beijing we'll keep you posted. back over to you. >> that's one to watch thank you very much. the markets do seem to be getting more and more worried about the global growth fears and paying less attention to the

president's tweets, like this one this morning, saying china wants to make a big deal but that didn't help are investors not believing the commander in chief andrew, i'll start with you, the retail sales number this morning for the u.s. was fantastic markets shrugged it off, why weren't they reassured that america is still doing okay? >> i think we're going through a correction in the market if you look back since the bull market started, every time we have the directions it takes two months to work its way out and i think we're coming to the tail end of the correction. the other thing going on it's tax loss selling season. so all the areas down on the year, they're getting hit worse. we're coming towards the end of this in the next week or so, and i think that's setting up for maybe a little bit of a christmas rally into the end of the year

>> tom, we had the retail sales number this morning, the tweet from the president suggesting china wants to make a deal why don't you think the market has responded better to that >> i'm going to agree with andrew in the sense there's a lot of tax law selling if you look at the retail sales, strong numbers but it's going to be really focussed on the e commerce sites when we start breaking down where the number sources are, i think we do see some strong consumer consumption but in a light group of industries. the key is a year ago we were talking about market probably overvalued and then we had a fairly sharp correction early in the year which recovered i think that's where we're at this time within the next couple months we have attractive valuations there's so many positives of the market we're in a perfect storm of bad news. >> andrew, you sound positive about the markets but what is there you see that will be the

catalyst for 2019? we set up 2018 with a period of earnings are. going to reach peak growth, we had the positive tail winds going into 2018 and 2018 turned out to be a bust for most so why does 2019 look better? >> what's fascinating when expectations of strong economic growth are high the stock market doesn't do well. it's when expectations are low the stock market does better i think we're going through this process of we started with sky high economic expectations at the beginning of the year and we're in the process of coming down and so, i think -- i'm not -- look, i'm a little optimistic. i think the market is going to get worried again about fourth quarter conference calls but you have to be more optimistic because we've watshed out a lot of positive sentiment from the

beginning of the year. the stock prices are down, dow earnings are up, that should make stocks more tragattractivex year so it seems the setup is at the end of 2011, 2015, flat year, washout and sentiment. 2012, 2016 were better but certainly first part of 2016 was a little rough so this is a longer term 2019. doesn't mean we can't have more weakness early next year. >> tom you're nodding. looks like you were agreeing with andrew. but he mentioned something key, the fourth quarter conference calls which start in january do you think we're going to get a trade deal with china between now and january? i ask you that because what royaled the markets when we started getting these conference calls and companies started talking about higher input costs unless that abates, what's going to change in terms of of the tenur of the outlook.

>> i think the fourth quarter calls will not have any abatement from the tariffs it's going to be what is the mood that's set. we're driven on the emotions of the latest pronouncements that come through d.c >> even though we shrugged off the one this morning. >> yes i'll tell you right now i think everything is priced for a perfect recession. i don't see a recession in the cards. i suspect what the fourth quarter numbers will tell us, earnings are trending down but i think they're going to look at consumption, demand is still rising wage growth is rising. employment is still stable that's going to set the stage for i wouldn't say robust but a strong enough economy next year to provide that underlying support for the markets. >> even the current gdp quarter adviced up >> thank you, guys shares of johnson & johnson sitting near session lows down

close to 10% this on a report fro "reuters" saying the company knew for decades their talc tested positive for asbestos. less funtleyder is here. there aren't too many analysts notes out but i have read some and they all seem to say this is manageable for johnson & johnson. if you assume the complaints are going to double by the end of the year, it's a rounding error for johnson & johnson at the end of the day where do you stand >> we don't own johnson & johnson. i'll just make a couple of observations we've lived through things like this before. i think some of the notes probably referenced fen fen and viox out of the corner of my eye it

seems like a decently valued company. i'd say these legal issues have a hang effect because we're at the beginning of the process and there's more to come out there has been a little bit of a shift. we've known about the talc issue for a while and there have been cases. but for whatever reason the market is acting differently based upon the story today that it hasn't passed it's been really shrugged off the news not that i put that much credence into market response but the market is suggesting there is something new that happened this morning. and i would expect that given the attention surrounding this, especially with the market move, that the fda might have some more comments about this and maybe some other regulatory action. >> do you think this perhaps is a different sort of case than fen fen and the other cases you had mentioned only because this

concerns babies and it concerns mothers and it concerns cancer and allegedly deception for decades. reputationally, even though talc is a fraction of a percent of johnson & johnson's annual revenues, reputationally could they suffer a bigger hit when it comes to their other products, particularly consumer products >> i think you're exactly right. we don't really know, but the -- but johnson & johnson has here to fore had a stellar reputation so anything that diminishes that is clearly going to be value destructi destructive. so i think at a minimum some value has been destroyed j&j can obviously make a comeback if they come clean or if it turns out this is really not as bad as we think but i think it's a process and looking back at some of these other events it tended to take a year or two before we really got to the bottom of things.

from a stock perspective, i think this is going to weigh on j&j for a while. >> j&j put out a statement very strong against the article, calling it one sided, false and inflammatory and even an absurd conspiracy theory. like you said if the company was aware of this in the past, for a lot of consumers it's the first time they're aware of it should they have been more public a decade, two decades ago, even if they knew the risk was small as they're saying? >> sure. again, e we're at the beginning of the process i'm sure there will be more lawsuits and press releases. if they knew about it, they probably should have said something. that's what i would do if i were running a pharma company i think transparency is always the thing. they learned this from the tylenol scare in the '80s. coming right out and saying it is the best way to defend against any of this.

to call it a conspiracy theory, i might not have even suggested taking that tone even if they -- even if it truly is a conspiracy theory, they should have said the news will validate us entsomewhere along way. j&j is at risk of being tone deaf here but they have taken a hit in creditability >> les we appreciate it. it's interesting to note we did reach out to more than a dozen analysts that cover johnson & johnson, ten said they're not available, and four said they couldn't cover it and four said they couldn't talk about the story. >> his point was great maybe with the response the company should have handled it differently. >> right. >> we'll have a chance to talk about this, the "reuters"

reporter will join us. plus we're going to talk about oil on the move. new reports that saudi arabia plans to cut exports to u.s. refiners is this a key relationship issue? robin hood's financial plan we told you yesterday to offer 3% interest checking accounts, they may be in hot water before they get started. all those stories and more straight ahead on "power lunch." place, the xfinity xfi gateway.

and it's strengthened by xfi pods, which plug in to extend the wifi even farther, past anything that stands in its way. ...well almost anything. leave no room behind with xfi pods. simple. easy. awesome. click or visit a retail store today. the u.s. and china are on a

collision course with waway caught in the middle that's by a new op-ed. she breaks down the fight for control over the global communications industry. joining us is mcc. great to see you. >> good to be back when we were talking about the arrest of this huawei official we were talking about it in the context of her being a pawn in the trade war. but this is a bigger fight. >> it's a much bigger issue the president talked about the possibility of using her as a pawn in the trade war when you talk about huawei and the five g, there's something bigger going on they're very concerned that china through huawei are spreading 5 g through countries around the world it's different, and allows for

higher level of surveillance on individuals. >> absolutely. part of the structure of 5g is such that the cell towers take over some of the systems from the core so therefore if you're able to corrupt those cell towers you're able to hack the networks more easily so huawei is dumping more equipment. >> there's a phrase called standard dumping in the old days they produced too much steel, cost, drive the steel out of business and they can command the business now there's talk of standards dumping, let's sell the equipment cheaply and their standards can be as pervasive as possible for their intent. and people in the field describe it as a digital iron curtain >> meaning the choice between countries is to whether or not to get involved with this technology period. >> at all. many of our allies, like the united states are deciding

they're not going to do that british tell come is not going to do it japan has banned it, australia banned it. and the major tell come providers to not use the equipment. >> people say they like the customer support, it has earned a place in the market. for businesses, for americans we hear the headlines we have to be concerned about huawei being a trojan horse for spying. i wish the president would explain what the goal and strategy is here, if it is to say you have to accept short term pain, because the long-term goal is to make sure we're safe here. >> what the tradeoffs are that he's willing to accept private industry has accepted that tradeoff. when the major carriers here

don't buy huawei equipment, even though it's cheaper, they don't. >> we have to read between the lines. we have to understand if people go to china and are concerned if they can still do business there, are they being caught up as well? >> within the think tank community, the ngo community, the apprehension of those two canadians and nobody knows where they are at this point, that sent a chill between the three of us, how many of us do we know of people that go to china to meet with executives, talk to officials, et cetera, and now they're very concerned about it think about the way she was treated versus the way the two canadians are treated. she gets three days of hearings, a lawyer. >> and they're still upset. >> exactly >> where are the two canadians >> we don't know >> michelle while you're here, i want to talk about another international story.

the report that saudi arabia is planning to cut crude exports. how much is this relationship unraveling and how big a deal is this. >> the saudi decision to send exports to the u.s. to a potentially 30 year low i think it's more tied to their fiscal imperatives. the saudis did this in 2017 as well they understand u.s. data releases are the most widely read by the market so you can influence the market and get prices higher. that said in the senate yesterday, we are at the lowest relations since 9/11 the senate is drawing a line in the sand on the khashoggi killing. >> we're watching the oil price, it went up a little bit yesterday but it's still on the big downward slide what happens next? >> i don't know if it's going to work for the saudis. even if they cut production we're the swing producer here in

the united states. we don't have this top down government control about oil production the minute the price starts to use you see u.s. producers step back in. the saudis have fallen on their sword before when it comes to cutting production, because nobody else will they'll cut production in the hopes the price goes up. if it doesn't happen it's going to be a waste because they'll have lower production, they'll lose money >> are we seeing signs that u.s. producers are drawing back i read a report that said texas was at record output levels to the point it was a bigger producer than iran. >> what happens if we go below 50 twi, that's a pain point, that's something where you had the saudi say we've given a lifeline by stepping in and pulling barrels from this

market i think the sub 50 price environment for wti we would be talking about the u.s. pull back i think the opec action it gives them a pull back but i think they're making this point to hope it will be effective. they believe the market isn't as oversupplied as we would believe. they say outside the u.s. the picture looks better so i think they believe this action will push us back to the 60s for wti and 70s for brent. >> can i ask you a question when i see there was a cease-fire announced in yemen, in one particular city, i wonder when you're looking at transactional diplomacy, as it is in the world right now, does the crown prince say i managed to get a small cease-fire secretary pompeo so back off punishing us about oil production i'm going to cut here is he doing that kind of

thinking i can cut production now because i've done this instead >> i think in terms of transactions, i think more the movement on yemen with a cease-fire is about staving off a threat to cut off arms sales to vaisaudi arabia it's trying to make the argument that saudi arabia is an important aly to the united states can they explain to president trump that there might be a price that works for consumers and producers. i think on oil it's a bit of a separate issue i think yemen is tied to the arms sale issue to saudi arabia. >> so not connected. oil price dropping 2.5%. guys, thank you, good to see you. >> great to be here. tesla cutting prices in china. we'll speak to an analyst who just began coverage on the stock. why he thinks it'll go beyond

the 420 mark costco falling after reported earnings "power lunch" is back in two so no matter what you trade, or where you trade, you'll only pay $4.95. fidelity. open an account today. ...starts with a december to remember at the lexus december to remember sales event. lease the 2019 nx 300 for $319 a month for 36 months. experience amazing at your lexus dealer.

costco shares plunging more than 8% after reporting weaker than expected earnings we're joined with what is behind this weekness. court any. >> even strong sales are not satisfying costco investors here today. it is true they missed their earnings investments by a penny.

sales up almost 9% most retailers would love to see numbers like that. costco is investing in its e commerce operation and fulfillment, different options for buy online, pick up at store are expensive. they're working on their i.t. capabilities, paying workers more and they called out competition from retailers like walmart and sam's club because it's competitive, the prices get hour and so do the margins. the ceo tried to remind everyone on the conference call the investments are for the long run. >> this is the tale of a lot of retailers out there, because their sg&a expense grew 11%. so retailers having to spend more money on wages which costco

did. macy's had the same problem with its quarter when it fell on its earning report. >> i think investors are starting to get less patient they want them to invest in things like their stores, the service to be better so that means paying employees more, they want options online all of that comes at a cost and at some point investors want to see some profitability from that let's see what happens in 2019 and how thin everyone's patients run there. >> you're here to talk about how people can track retail growth with satellite imagery >> this is so interesting, kelly. there are a couple companies that do that we have this i imaginary and information from orbial insight. this is a company that uses satellite imagery to track parking lots

talking about the cars in retail parking lots, that covers 260,000 parking lots pap what they found between black friday this year and december 9th when it comes to the parking lot traffic is that jc penny sees their traffic up 10% relative to a year prior so this is a year over year data for jc penny target's parking lot traffic up 7% kohl's 6%. walmart 5% lowe's home depot and best buy are lower. but sales don't always come with that there's a conversion factor there. but it's still some measure we're seeing people go to the stores this holiday season. >> thank you, kortney. elon musk has been vocal about the damaging effects of tariffs on his business. what does the road ahead look like for tesla we'll speak to an analyst who's

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lunch. here's your cnbc news update this hour. in a speech to the united nations, nikki haley calling the cease-fire in yemen a sign of progress, but she warned the crisis demands more. >> it demands we take action to hold off the warring parties accountable. it demands that we address the iranian aggression at the root of the crisis. it demands that life saving assistance reach the women and children who are suffering the most from this conflict. minnesota regulators reaffirmed their decision on a route through end bridges controversial pipeline across that state but environmental and tribal groups voiced their displeasure by petitioning to stop the

product. dell monte is recalling corn, the fda said the corn did not go through the entire sterization process. the food was distributed in 25 states, so check your cupboards. let's get a check on the markets right now because we have drifted to session lows here we have the dow down almost 200% nasdaq come po sit down by 1.8%. it started overnight with weak data out of china and continued into today's decision, we are seeing weakness in technology shares, apple for one. all 11 s&p 500 sectors are in the red at this hour meantime shares of tesla off their session lows, the company

slashes prices in china as b beijing said it will suspend teariffs on cars from the u.s. $440 a share 20 bucks above the controversial 420 level. dan, great to have you with us. >> great to be here. >> could you have published the same notes, basically, prior to the tweet -- the infamous tweet? was anything different in your view has it been derisked in any way after it's gone through that process? >> i think it has been derisked when you look at what could happen, potentially musk not ceo, the fine was ultimately lower than expected. i think now it's about them turning the corner in profit ability. that's been the game changer based on our analysis and when we modelled this out, we believe

this is going to transform autos similar to how apple transformed smart phones i view this as a pivot point in the tesla story. >> what if they have to race mon - raise money? >> we have a 30% chance they'll have to raise 2 billion. based on the profit ability as they turn the corner we do not think a capital raise is on the horizon. you're starting to see investigators now, you look out the next five, ten years where can the stock go in our opinion 440 is starters you look at china, you could start looking at a stock with 5 in front of you. >> you think $22 of earnings power by 2025. that's looking a long ways out. >> from disruptive technology perspective, similar to apple

many years ago, if you look at tesla in 2019, 2020 earnings, you don't buy the stock here you have to have a much more normized earnings where this goes with model 3 production, especially with europe and china starting to hit the ground running. everything we're seeing, in our opinion it's the tail ends right now. >> do you believe they're producing 1,000 model threes a day? that's key, right, to believing the cash flow is there, there won't be a raise necessary >> all of our checks, we continue to think based on normalized production here it's right about 6500, 7,000 per week the question is can they get to 10k, we think they can especially as you see giga three in shanghai. but right now is as comfortable as we've felt in the tesla story. you look at why the stock is

reacting the way it is, it's because you look at the model three production, where this thing can go in our opinion it rerates higher. >> meaning it's having a great fourth quarter what is your perspective on the stock? there's a split between whether it's viewed as an auto technology or a technology company. you have to view it as ta latter >> yeah. i view it as a disruptive technology and in our opinion, disruptive technology that we've seen from apple, this is a game changer stock. that's why it's about that free cash profitability we look five, six, seven years. >> apple, are you buying it? >> it's about the services the install base we believe ultimately 10 million units came out of china, didn't come in. i think that's going to be

factored into street numbers we buy that continued here i think the bad news is baked in as we've seen with the street numbers. >> dan, thank you. >> to the bond market now. we mentioned a moment ago stocks were near session lows how is it looking with the treasuries >> looking at treasuries you'd have a hard time divining we're at close to lows in the days at equities chart the five year, it's up four basis points on the week. you can see that's the odd man out. the catalyst for minor investigation. it's coming back in line to some extent one week of the dollar index, it's up close to a half a cent the best close since the third week in june, at its high. h2ig, since november, starting to get its sea legs back if we look at a four-year chart

on the securities side of the high yield market it will put it in perspective spread may have widened you but still nowhere near some of their sweaty levels. and when you look at the treasury, the volatilities have been mostly trained. >> the high yield part of the bond market has been steady. what do you think is going on with the stock market today? >> i think the stock market is caught in a whirlwind of bad things catching up to it at a time inni year end where you hae the weaker numbers, i think some of the issues of the day from a political standpoint before some of the new members are sworn in is also a catalyst for investors to be a little bit safer. >> safer they are. straight ahead shares of j&j

are plunging today a shocking new report says the company knew for years their talc contained asbestos. stocks down nearly 450 jeffrey gundlach is life on monday looking rwd hfoartois remarks "power lunch" is back in two

welcome back and this is the stock story of the day. shares of johnson & johnson are tanking since their worst day in 2008 a bombshell report this morning saying j&j new abouts asbestos n their talc

j&j responding saying this is absurd says studies of more than 100,000 men and women shows talc does not cause cancer. goes on to say thousands of independent regulators prove our talc has never contained asbest asbestos joining us is the "reuters" reporter who broke the story lisa, welcome. >> thank you >> what would you like to say to the charges this is a conspiracy theory you're reporting this morning. >> look, our report on the fact that j&j was aware of small amounts of asbestos in its talc, in its baby powder, in the ore it mined in vermont to make baby powder is based entirely on their documents. many of the documents are posted now. if people are curious they can read them on our website,

roiters.com. >> did the company know there was asbestos and specifically decide not to tell the american public >> so we see that historically in the '70s, '80s, that era, that there were company memos and reports where they're talking about asbestos, what to do about it, fretting about it, how to detect it, how to get rid of it. is there ever going to be a way to get rid of all con tanment. during that era they were talking about it today their position is nothing in those reports is actually asbestos that got into baby powder they look at the reports and say, no, that talc was going to an industrial purpose. that mineral is not real asbestos and things like that so they -- right now they're not acknowledging that any of those

reports reflect any asbestos going into their talc. >> lisa, in your article you also mentioned there were reports that date back as far as 1957 and 1958 in which there was testing of talc and there were particles, contaminants in it that are one of the naturally formed minerals associated with asbestos are you saying that for the past 60, 70 years this company knew or had suspicions there was asbestos contaminants in talc? basically you're saying every generation of management has been complicit in some way in allowing asbestos to be put on the market through its talc powder. >> it's not clear what layer of management, especially in recent decades, who knew what what is clear is that the people responsible for producing talc,

finding talc and marketing and researching baby powder, certainly in the '60s, '70s, '80s, that era, there are plenty of internal documents again that are many of them posted at "reuters".com that show that the ore they mined, the talc they produced, and baby powder and shower to shower had small amounts of asbestos in it. this was known certainly in the '70s and one of the issues is that talc and asbestos are minerally similar and occur together in deposits so it was inadvertently mixed in they tried lots of ways to get it all out but the reports that they got on

occasion that small amounts ofs a bets to were found in the talc and in the powder indicate they weren't always successful getting it all out. >> what's the motivation for them to keep this quiet? is it financial? too expensive to figure out a way to get the asbestos out of the talc? what would the motivation be for concealing this? >> you'd have to ask them. i don't see anything in the record right now of the many hundreds of pages of documents -- thousands of pages of documents that i've looked at that would explain that. >> lisa, finally, your reporting has established there was asbestos in these products and some of the reasons as to why. what i'm not clear on yet -- and i don't know if you can add more light on this -- is does that amount of asbestos in baby powder cause cancer? >> so what we know is that the world health organization's international agency on cancer -- for cancer research has listed asbestos-contaminated

talc as a carcinogen for decades. that's long been known and well established. whether any individual person's cancer was caused by exposure to one of their products is a very fact-based inquiry and, you know, it would depend on exposure levels and all kinds of things, so i couldn't speak to any particular case but we do know that, you know, world health authorities have long considered asbestos contaminated talc a carcinogen. >> would you use j&j baby powder, lisa >> i don't think what i would do is relevant. >> just curious, because i'm sure friends and family members would ask you what would you do? i don't mean to put you on the spot. >> well, let me just say, my report doesn't talk about the products they're selling today there's no evidence that what they're selling today has any asbestos in it.

>> lisa, thank you so much for joining us lisa girion is the reporters reporter from that story. >> robin hood announced it would offer interest free checking and savings accounts with a 3% rate -- one problem, it forgot to give key regulators a heads out. the fallout next stocks hitting session lows moments ago. check out the big banks as we hit out in the red except by bank of america which is up 1.3% stay with us see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st.

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leave no room behind with xfi pods. simple. easy. awesome. click or visit a retail store today. 3% on your checking and savings accounts is it too good to be true? for robinhood, that might be the case a key industry watchdog said they didn't know about robinhood's plan we bring back kate rooney to follow up. >> that was the first thing you guys said, what's the catch? so we called steven harbeck, he said he was just as surprised as anybody so obviously they hadn't contacted him. he said they hadn't contacted the s.e.c. and considering that they hadn't spent two years planning this, it seems like a big overlook robinhood hasn't responded to

requests for comment but these accounts, he said, were not meant to be checkings and savings accounts if you're ensured as a broker, they assume you'll put that into securities. >> that was the whole thing with robinhood. that's what buys you -- bob said in the interview, they'll take this money and trade it. not trade it with cryptocurrency or anything like that but with treasuries, but that's trading money and that's basically a brokerage account. >> it is so i called barney frank who we all know from dodd/frank, know this is subject better than anybody and brought up the issue of the risk here so he was saying so, yeah, they're going in the direction of the federal reserve but if for some reason interest rates don't go up, will they be incentivize to risk your assets, higher yielding? >> that gets to the core because even by investing in treasury, they won't make enough to cover 3% if they reach they'll bring into the viability that sipc has to back so for two years they didn't play and never consulted

with them. >> but the opportunity that this high yeld ield -- we talked abo this yesterday, the amazon approach of going quickly but it's not clear sipc is prepared for the growth of these accounts so they were concerned that they habit done anything to alleviate his concerned, he seemed annoyed. >> strongly worded response to that. >> and ubs came out with a note this morning saying they covered td ameritrade and charles schwab, they said the details are thin of the product, just came out but based on what they understand it seems potentially risky that they are skirting a risky ploy that is skirting very close to actual banking and therefore could draw regulatory scrutiny. >> which it already has. >> absolutely. the dow falling almost 490

points the 2:00 p.m. hour of "power lunch" has turned into one of the most volatile periods of the day for the markets over the past few weeks so you won't want to go anywhere stay tuned

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what's on the menu fears of a economic slowdown are sending shock wave us there the market once again as mom and pop keep pulling billions out of stocks how worried should investors be? plus, another day, another slash in iphone sales estimates. apple shares falling again they're down 2.5% today. when will the pain trade end and facebook saying another bug exposed. photos of up to seven million users who use a third-party app. the latest black eye for that social network we'll bring you the details. the second hour of "power lunch" begins right now welcome to "power lunch. i'm melissa lee. stocks are close to session lows fears of a global slowdown fuelling these fears the dow was down 487 points at the low. right now down by 470 or a loss of 1.9%. on the nasdaq, we're off by 1.75% and the s&p 500 is down by 45 johnson & johnson, walgreens,

boots alliance and cisco system are the biggest laggards right now. let's get to seema mody. >> just in the last 20 minutes, the dow's lows were 476, we're currently down 472 a confluence of factors driving stocks lower today we made this this custom dow chart will which explains the move so far. it started with those china growth fears after the latest data provided further evidence of a slowdown in the world's second-largest economy and then around 10:00 a.m., that reuters report on j and j shaved off a few more points on the dow jones industrial average, then we moved lower once the european markets closed at 11:30 a.m. eastern. it's been a tough week for european markets as a whole. all 11 s&p 500 sectors are trading down gold and oil are trading lower as the dollar gains strength now back above 97, trading at 8744 the ten-year right below 2.9%. then there are stock-specific

stories, starbucks low everything guidance. the market didn't like costco's or adobe's numbers so there's a lot of factors that investors are trying to digest next week we get housing-related data that the market will pay attention to in terms of major sectors leading to the down side, the big moves in the financial sector, we have goldman sachs, bb & t and citi. nameky was part of the list ahead of the earnings report next week but two is also reverse course trading down fractionally on the day. >> back to you on the day. seema mody according to bank of america, u.s. bond and etf out flows accelerated bringing stock redemptions to a record high of $34 billion. are investors selling out of this market? ron, let me start with you, if

you look at the various components of the market, it's not pretty financials are close to bear market territory at this point transports are down sharply, industrials are down sharply small caps are down sharply. >> it's nothing like the small caps leading higher before now outperforming on the down side the banks and tech stocks failing and you see stocks capitulate as well i've heard arguments on air today. it seems a simple explanation. the global economy is slowing. forecast for growth and profits have to come down, we have political toil in more than one country, including our own. >> you're right. the global data looks terrible but even the jobless claims, yesterday they fell to almost a record low they look incredibly good, the retail sales numbers are strong. can we be an oasis >> we can for a while but not forever and this is what a peak economy looks like you don't get stronger from here

necessarily. it will be hard to find a catalyst or lever. >> but it could go on for some time. >> we've not seen that before. interest rate markets, commodities markets and stocks are telling us for. >> you have a wireless fund, you have extra cash there. does that mean you're not optimistic here? >> i'm optimistic for the long term i'd love to be buying my tech favorites right here right now but the problem is most viewers and investors are worried about if you buy something for the long term that it takes a little bit of a spill in the short term so i have 9% cash in the fund and when i buy tech stocks i buy them slowly and deliberately i'm also buying techish names. >> what's techish? >> the techish names are companies that i think have tech drivers. let's call them in payment processing companies like mastercard and visa. i actually like boeing very much i think it has a services

business that is even more interesting than apple services business and the nice thing about these stocks is they are much lower volatility until the smoke clears, i'm more comfortable buying then and playing defense or hiding, whatever you want to call it, until the smoke clears and i agree with ron, the smoke might not clear for some time. >> it's an interesting point, ron, that you can take a name you wouldn't think of as defensive or a sector you wouldn't think of as defensive but because of the selloff and attractive things about it, those are attractive places to look. >> paul and i have been doing this together for 30 years and you go back to tickis istechishi back to $3200, some of these things are not happening as quickly as people as suggested so hiding in quality is a good idea in markets like this and you get paid for that. that move out of the danger zone for a period of time. >> in terms of the names, paul, that you are buying deliberately and slowly, the areal tech name,

not just the techish names, what's on your list? >> there's a couple names i like but i might be wrong short term with the timing but very confident long term. among the majors that we most often discuss on the air, i like google at a thousand dollars a share buy limit. i think autodesk is very interesting. microsoft. it seems that it goes down far less than the other guys so it's a relatively defensive place though i can't make a great valuation case there but among the majors i like those the most now, the next big decision for any tech investor like me will be not only when do we get back in the sector but the -- off the bounce, the industry within the te tech sector are the cyclical names, particularly semiconductors and semiconductor capital equipment. if i get that right, and that call will probably need to be made in the next couple months,

you could have a couple semiconductor stocks i'm not buying now but at some point could be doubles or triples off the bottom. >> you following them into that? >> sure. the one thing i would say is you need three catalysts for this market to turn that's the fed to stop, the trade war to end and political situations in a variety of countries, including our own, to clear up favorably. >> no problem. check, check, check. ron, thank you, paul meeks, thanks to you as well. >> thank you. shares of johnson & johnson are on pace for their worst day since october, 2008, following a damaging reporters report. the reporter who broke that story speaking with us moments ago. leslie picker joins us with the latest at this hour. leslie >> shares of j&j continuing their descent, down by more than 9% such pressure on the stock comes on the heels of a blockbuster investigation by reuters the report showing the company knew for decades that its raw talc and finished powders sometimes tested positive for small amounts of asbestos.

reuters says it obtained confidential documents to facilitate its reporting and those documents reveal j&j failed to alert regulators or the public about the potential asbestos risks and reuters says j&j sought to influence the fda's plans to limit asbestos in their products as well as scientific research on talc. j&j issued a long statement saying in part that the article is, quote, one sided, false and inflammatory and that it's an absurd conspiracy theory j&j says it will continue to defend the safety of its products and as you can see, johnson & johnson down 9%. >> biggest decline since 2002. let's get to julia boorstin with a news alert on t-mobile and sprint. >> that's right, t-mobile and sprint expect their $26 billion merger to be approved by a u.s. national security panel as early as next week according to a report by reuters that reports their respective parent company says they would consider curbing

their use of equipment from huawei after deutch telecom has been pressured to stop using huawei equipment on concerns it could lead to cyber spying, which huawei denies. t-mobile shares down 1% on this news we'll get back to you as we get comments. >> and softbank, julia, also said it will stop using huawei the owner of sprint there, so big hurdle for them to clear, both the owners of sprint and t-mobile. >> absolutely. we're keeping an eye on auto stocks following news china is suspending some tariffs on cars imported from the u.s. phil lebeau is live in chicago with more. >> when you look at how many vehicles that are expected to be exported to china, it's not a huge number but it's significant for these companies, we are talking about mercedes out of its plant in alabama as well as bmw in south carolina and tesla

from its plant in fremont. overall, the united states will send about 250,000 vehicles roughly speaking to china in 2018 when you look at what will happen starting on january 1 of 2019, china said it will cut auto tariffs back to 15% remember, they were at 40% and for tesla, that news is the reason why the company said we're going to cut the prices on our model s and model x. in 2017, look at the change in revenue for tesla in china. in the third quarter the estimate by some analysts is that it was down to maybe 6% of the company's revenue. keep in mind the model 3 and the ramp-up makes everything in china appear smaller than it is. but that's the future for tesla. shares of tesla were up in the session but they pulled back the average price target, web bush out with its initiating coverage today, a price target

of 440 the average price target is up to $33 a share and finally take a look at shares of daimler as well as bmw. we'll also look at general motors not a big movement day for the auto stocks. a lot of this was baked into expectations after the meeting in buenos aires. >> do the american automakers expect to go down to zero? >> well, that's the expectation or the hope of the white house look, if they did that, they would have to do that for all of the countries and -- would haven't to but the expectation is china would say okay, well, it's not 15% the i'm not sure china is at that point yet. they have a number of other moves they'll make in terms of joint venture requirements they put in place that's more likely on the auto front before dropping the tariffs to zero. so many moving parts to this negotiation, trade negotiation between the two countries. phil, thank you. coming up, are we headed for

a global slowdown? we'll look at the data that may be pointing to yes plus, more turmoil in capitol? is wall street not paying enough attention to the troublings in d.c. and another problem at facebook "power lunch" is back in tw

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. we're off session lows, down 455 points on the dow. down by 1.9%, s&p down by 43 and nasdaq down by 122 information technology the weakest sector on if, the s&p 5. >> let's talk about the fear factors. we have the ongoing trade war between washington and beijing and questions about whether this is a truce or a temporary band-aid or something more today's carnage on wall street coming on the heels of disappointing data from china. their november industrial output and retail sales missed expectations bad news from europe the eurozone pmi index fell to the lowest level in four years how worried should the u.s. be about slowing global growth. joining us is megan green along with our senior economics reporter steve liesman let's start with you to give a rapid update on the u.s. economy which seems to be holding up okay. >> holding up better than we thought. we had a 0.2% increase in the average of tracking forecast for

the fourth quarter what a tracking forecast is, folks, is you get a model gdp in there, as the data comes in you adjust it for what happened or was reported there you go tracking 3% up 0.2, the range 2.7 to 3.1 all of the december data to come so it's two of the three months in there we have our first average for 2019 and there's the slowdown 3%. >> that's the forecast. >> that's the forecast that's what they think will happen. >> right you got something else do you have actual knowledge >> megan, are you in the camp that thinks we'll have a slowdown >> absolutely. coming into 2018 everybody talked about this global synchronized growth and it didn't happen this year but i think it will happen next year and we should expect that. in the absence of any kind of fiscal on monetary stimulus,

most economies should decelerate towards potential gdp growth rate and we've been well above potential for a couple years so we should expect a slowdown globally. >> i think one thing people forgot is a lot of the 2017 and some of the 2018 growth came from the idea that global economies were doing better than we thought and the synchronized global growth was like a davos buzz phrase. >> that was all the rage in december and january and then in february it was out the window. >> they were dancing around the snow in davos on synchronized global growth and then they got home and it was synchronized -- as the year has gone by so i may be wrong about this but estimates say it added a half point to the u.s. so maybe that comes off and maybe that's one of the reasons why people are in that 2.5 camp. >> i think a piece is the fiscal stimulus measures which hit the u.s. economy the most in the first three quarters of this

year but by the second half we'll mostly have dwindled but i they's why economists seem to have found consensus on 2020 being the year we find a recession. when economists find that consensus you can be sure it won't happen that year. >> people are talking about the slowdown give us examples historically of when we've seen -- so europe, the french data contraction overnight but the german stock markets have been terrible the european markets have been terrible how much worse do they think it will get if europe goes into a recession, how much bearing does that have on us? >> it has some but i think people are pessimistic of thinking of america being the so-called price taker rather than price maker how well america does is as equally important to the rest of the world. >> maybe more important. >> if we do well, others will do

well i think there's concern about china and that's because china is something like 25% to 30% of global growth. not global gdp but they make up a disproportionate am of the growth and by the way that's one of the things that has restrained prior administrations from pushing too hard. you don't want to cause a china slowdow slowdown. >> now it's up to the chinese to decide which is the more important thing. supporting their economy or winning concessions from the u.s. >> i'm not overly worried about a slowdown in china. it started before the tariffs kicked in and the tariffs will bite in terms of the chinese economy but the benefit of having a centrally planned economy is that the chinese government has a ton of tools to use the prop the economy up so

they've provided a bunch of monetary stimulus. fiscal stimulus at the local and regional level and unofficially the government can lean on banks and soes to lean into the real economy. so in the short term i'm sanguine on china. china has a longer time frame than the u.s. does typically so i don't think china is wondering whether it needs to worry about a detente. it's playing a much longer game thinking should we wait it out through 2020. >> i think it's important to look into the camera and talk to viewers and say you, the u.s. consumer, that has power to save the world. >> really? they have and it's not saved the world and it's not saving retailers. >> it's happened before on the cusp of imminent slowdown we have wondered.

that's why we had the 0.2% increase in the fourth quarter. >> but the machine you're calling son the machine that washington is jeopardizing with the tariffs. >> that's true absolutely. >> like you were saying about cost going up. plus it will hit us where it hurts. >> i've been told that is it. >> steve, thank you. steve liesman ever gracious and megan, appreciate your time as well. >> ever gracious, wow. coming up, demand for iphones is falling short the stock is down more than 2% will the hits keep coming for apple? trading nation is next check out the names leading us lower on the s&p 500

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welcome back to "power lunch. fares are devouring apple as investors threat over slowing iphone growth. stock losing a quarter of its

value in the past three months and down 30% from october highs. let's bring in craig johnson of piper jaffrey and gina sanchez for more craig, what do you see in the chart? looks like levels from april. >> when i look at the chart of apple, we're coming down to good footing. i think the stock will find its footin footing. you're looking at bullish divergence so while phone numbers were cut today, to me fundamentally it will be about what we'll see with the apple sales going forward, that's a key driver technically we will find footing shortly. >> the fundamental story is intact apple was never one of the higher priced high flyers so theoretically some of this is sentiment working against them i don't think they're highly valued and i think they have a good outlook yeah they're a slower grower,

harder to move the needle but there's still value in this stock. >> and what levels are you watching in terms of finding our footing short ly. >> 160 and 150. >> so seven bucks lower and then 150. craig, thanks. craig johnson and gina sanchez for more trading nation, head to our web site or follow us on twitter @tradingnation. coming up, should the markets be more worried about what is going on on capitol hill that's next.

hello, everyone, i'm sue herera here's your cnbc news update at this hour. european union leaders heading home after a two day

summit in which british prime minister theresa may failed to secure any major concessions to help her government haas brexit. french president macron saying the deal won't be renegotiated. closed circuit tv footage has been released of thursday's high-speed train crash in turkey nine people were killed and 86 more injured in the crash which occurred at a train platform in ankara supreme court justice ruth bader ginsburg describing her immigrant roots at a naturalization ceremony for more than 30 new u.s. citizens in washington she told the gathering her father arrived in the u.s. as a 130-year-old with no fortune and no english. >> what is the difference between a bookkeeper in new york city's garment district and a supreme court justice? one generation my own life bears witness. the difference between the opportunities available to my mother and those afforded me.

>> quite a story that's the news update melissa, back to you. >> that's an inspiration, sue, thank you. sue herera we're off the session lows, we're still down sharply, the dow is off by 450 points s&p down by 1.6% nasdaq is off 1.7% small caps and financials are in bear market territory so they're down roughly 20% from their 52-week highs. >> lots of selling in oil. the oil market is closing for the day. crude is down 3% one of the many factors cited overnight as reasons for investors to be concerned more broadly. over $51 a barrel for wti means the drop in gasoline prices is going to continue. let's get to eric for a market flash on the opioid stocks keeping a close eye on shares of opioid distributors following a "60 minutes" investigation that will air this

sunday the report notes that mike moore, the lawyer hired by iowa's attorney general to sue the opioid company is a former attorney general of mississippi, he helped negotiate settlements against bp after the oil spill and tobacco in 1988. news of the investigation taking down shares of endo pharmaceuticals, they're a major opioid distribution but purdue pharmaceuticals are private. back to you. >> thank you, eric a jittery friday on the street as we are 90 minutes from the weekend. let's bring in steve grosso, fast money trader from the pink that what do you make of today's selloff? >> there's nothing positive that can be made out of it so the market has been concerned with global growth jitters, the market has been concerned with rising rate environment and the trump investigation and all of those are on tap and there's

nothing to be excited about as far as positivity in the market. >> you mentioned the trump investigation, the mueller investigation and that's something that on "fast money" we tend to steer clear of. it's a political issue, of course, but you're saying you think it's an impact on the markets. why has it reached that point finally? >> once you got divided government and people start to settle in and see what that looked like with schumer and pelosi inside of the oval office, it won't be pretty for the next two years or couple of months every time we approach 2600, look where the market is right now. 2603 that was the level we had a break initially. if we break 2600, melissa, we are going to fall violently and it will be fast and we might even test february lows today. i know that is a bold statement. >> and we're four points away

from breaking 2600 on a sustained basis. we had an interesting call from todd gordon of "fast money" and he said if we test february lows we could see amazon slice through to 900 is that the pain you would anticipate for these quote/unquote high-flying tech stocks. >> you and i sat next to each other and i looked at you when he said that if that 2532 doesn't hold up and we go to 2300, 2350 which is very possible, you're looking at these large cap tech names that will get demolished and amazon is one of them so amendment hazon is a couple d below but i see support at 1400, i see support at 1250. i think what todd was saying is that if the whole market gets to that level, they're going to be

throwing out these favored names quickly and $1600 falls past on the way down. >> and lastly, steve, in terms of so-called safety trades in this market, a lot of people look to health care. you look at the xlv, it's down by 3%. johnson & johnson is about 11% of that etf. is there quote/unquote safety in this it that correct. >> i would say johnson & johnson just put that into question but the xlus, the utilities, are probably as safe as you're going to get even they're going to be down but look on a relative basis when you look at utilities they'll go up when the market goes up and down less when the market goes down so utilities are probably as close to a safety trade as you can get in a non-safe market. it's non-safe today so be careful when you're investing. this market seems very ugly to me. >> steve, thank you.

steve grosso and the dow jones industrial average just down 500 points he mentioned the concerns in washington let's bring in hugh hewitt, an nbc news and msnbc contributor, hugh should investors be more focused on the news flow out of d.c. >> no, in fact, think it's hurting people's rational assessment of the economy despite trouble in china's and the eu's crackup most bad news comes from the leadership of the europe telling britain to pound sand and we will see dislocation there but the stories about the president and impeachment, there's an incentive on cable and in print to say increasingly alarmist things divided government is the rule not the exception in the united states we figure it out going forward there are old hands there in mitch mcconnell and nancy pelosi and thol though the president is an unusual commodity and energetic as well as charismatic and divisive and destructive, he

doesn't drive the economic bus to the extent a lot of people do so there's a lot of hand wringing that is overstated? >> hugh, we're not coming up with this out of thin air. there's divided government, then there's the type of rhetoric we're hearing about the plans for the democratic house in a couple week's time are you saying we should disregard that as noise and fundamentally everyone will hold hands and work on infrastructure spending >> about 90% is noise and i base that on the change in the congress in 2010 when president obama got wiped out, the democrats lost 63 seats and 2014 when the democrats lost nine president obama continued on in his package with his 2% growth gdp and the underlying economy is not impacted by the political spit balling that goes on in washington, d.c. between committee chairman and the executive branch so jerry nadler thinks it's great, the income chairman of the judiciary.

he think it's great to go on tv and threaten impeachment guess what bill clinton got impeached, he didn't get removed it doesn't happen. so the president will finish this term, he may get reelected, we'll have fun on table talking about who did what to whom. >> but i'm surprised you think the president has so little impact over the u.s. economy but as we saw from the obama years and we're seeing in the trump years, the direction of their plans is -- makes a big difference tax reform this year, the deregulatory push. you don't think that that's a major issue here >> no, the regulatory question is a huge thing. >> we're down 525 points right now and the question is whether the u.s. can sustain the growth we've seen with the rest of the world tipping into recession practically. >> well i trust the fed. i believe the tax impacts from the reform of last year only have begun to kick in, especially on the individual level.

they don't even have clarity yet as to what happened to, say, for example subchapter s investors they don't have an idea of whether they're bet off or worse off. we tend to overstate everything in the media because there's an incentive to do so and a 500 point drop, that's not a great day for an investor but next week might see a 500 point go up. >> but we're talking about the numbers out of university overnight. france is contracting for the first time, germany's manufacturing and services data. so if that malaise is for real, we're not just making that up, the question is can the u.s. -- can u.s. consumers as steve was suggesting continue to hum along in this great economy or not >> yes i think they can. i believe the united states, i believe the fed. europe is a problem because juncker and tusk are intent on

punishing great britain for leaving the european union but just today liam fox, the minister for trade, executed a new agreement for switzerland. what britain will do is become the singapore of the atlantic and that will be a great thing, it will take a couple years to get there. i don't see panic internationally. i see problems with china, they are aggressive, ambassador bolton gave a speech yesterday that laid out the fact that the united states and china are on a collision course that's not a small risk. that's worth worrying about. >> and there is concern in the market today and other days. hugh, thanks for joining us. that's hugh hewitt dow is down 525, taking a leg lower. >> 520 down with the s&p 500 at the 2500 we were just talking to steve gross who said a break below 2600 could mean a wave of violent selling.

today will be an important close on the s&p 500. up next, the hits keep coming for facebook. another day, another privacy breach potentially impacting close to seven million users we have the details after this break and we're keeping a close eye on the markets as we count down to the final hour of trading. dow down 510 check out the financials hitting bear market territory intraday we have steep declines across the board but bright house, jeffries and fifth third down sharply. "power lunch" will be right back ♪ ♪ ♪ ♪ the difference between possible and impossible? it's a person who believes they can, surrounded and supported by others - by us - who believe it, too u.s. bank - the power of possible.

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welcome back to "power lunch. the selloff intensifying on wall street as you can see, there's not a single sect knorr the s&p 500 in the green right now. take a look down here. health care down 3.5%. >> it's the best performing sector year to date.

>> >> the dow making lows here about down 550 point s? a black eye for facebook as well we talked about tech facebook closing another privacy brea breac breach. >> facebook saying a bug affecting 6.8 million users exposed photos users hadn't shared giving apps access to these photos for 12 day this is past september facebook saying in a blog post, quote, we're sorry this happened next week we will roll out tools for app developers that. >> this is a series of negative headlines around facebook's

privacy issues as well as issues of facebook. facebook shares are trading lower. back to you. >> 6.8 million accounts, julia >> 6.8 million accounts. so the idea is that if these users had uploaded a photo to facebook but not shared it people can put photos on facebook without putting them out there. the question is how many app developers have access to these photos so 6.8 million users isn't huge considering facebook has 2 billion users but it's the principle that is concerning and could be concerning for users as they try to figure out if they'll spend more time on facebook. >> the next quarter will be critical the stock has shown signs of bottoming, jim cramer says there's signs facebook wants to bottom untiljust moments ago but it has to control its expenses >> there's the question of expenses which are in many ways

tide to the issue of safety and security but also the fact that facebook shares hit an all time high in july since then, stock has declined dramatically and interesting that the stock was able to make gains through july and only started declining since then there's a sense that facebook was able to deflect and shake off these issues, able to add users and grow revenue and now there's more concern about how these issues could impact that user base and what will happen with ad revenue. >> julia, thank you, julia boorstin. we have a big selloff on the street the losses are, in fact, picking up steam a look at the charts and what they are telling us about where the market may be headed that's next. don't forget jeffrey gundlach will be live this weekend he made headlines when he said ice ssn.is on a quote/unquote suidmiio "power lunch" is back in two

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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 s & p 500 -- warning of the market rolling over. back in february he says nasdaq

was broken and the s and p 500 is hanging toen a threat joining us is here with bell curve trading. let's start off with the damage we are seeing on the nasdaq 100. this is really the heart of the market at this point >> yeah. i have talked about this if months it is the rally off of the 2009 lows when you look at that bebougwe them down here right around a thousand you you can see it right there here thesethings tend to be she metric 3,500 to the upside. 7,708,000. nasdaq is done it is very easy to predict i talked about this months ago one of the key drivers of the whole rally is you could

basically take it out of the equation >> it was supposed to be like this does it mean 3,500 down from the heights we saw just this year? >> the first place alook at is here we have this coming in about 4,500. it is around 8,000 the first place i would look for some support is probably right here in the middle maybe around 6,000 or so. the point is this is one of the key drivers of the whole rally it has basically been broken. >> is that your call that we go down 600 points if. >> at least? >> yes >> the large is the whole march 2009 rally is rolling over we are not talking about a one or two month thing here. understand that the march 2009 rally is almost ten years old. if we correct it will be at least 25% to a third you are talking about two and a

half to three and a half performance. what's going on now is very consequential. >> are you a pessimistic type of guy? >> no. >> they are saying this is a really a pessimistic forecast. >> no. i was on here in february, april and may and talked about the nasdaq being down. >> what are we looking at here as we get the chart up >> it nasdaq broken. dow is basically hit its target off march 2009 lows. the one thing holding everything together is the s & p 500. that's important because this is the key index all of them focus

on >> this doesn't look so bad to you. >> doesn't look so bad my assessment of what would happen if we are below that for a couple of weeks would be much more dramatic. >> so a couple of weeks at these levels >> what you're talk about is nasdaq broken, down. dow off the 2009 lows. this is the one thing holding the whole market together. what's the consequence of that a typical correction would be 25% to a third you're talking about if you break this level you're talking about two and a half to three and a halfyears.

>> and time is against you you sit below this for a couple of weeks you to play real defense. >> sector rise we talked about tech how about financials they are already off 20% >> yeah. the banks are broken too >> forget about those. >> if you want to hide out consumer staples relatively speaking it looks okay but this is not -- again, this is not a prify'all thing right here >> you have to look at this. >> yes >> got it. >> thank you much. we appreciate it >> mr. sunshine himself just like you said. more on the market selloff right

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>> welcome back. >> the market sold off this hour we are down 480 right now. it seems to have made up its mien mind right now it is upset about global growth. >> tech and financials are the

real problem retailers have to spend more money on online wages. that's not going well. closing bell starts right now. welcome to the closing bell. i'm sara eisen welcome back >> i felt like we were together because we got so many updates >> yes we are seeing another big selloff. we are down the best part of 2% with one hour left to trade. the s&p now on pace for the third weekly decline out of four weeks. the dow on track for the lowest close since june >> and chockin