good morning it is 8:00 a.m. at intel headquarters in santa clara, california, 11:00 a.m. on wall street, and "squawk alley" is live ♪ ♪ good monday morning. welcome to "squawk alley." i am carl quintanilla with morgan brennan and jon fortt major averages are falling deeper into correction territory. dow session low was down 315

we paired a good chunk of those losses, helping fuel the reversal caterpillar, boeing bouncing off the lows apple gaining 1% after a rough few trading sessions off the highs of october joining us, jim suva and analyst andy hargraves good to see you both >> thanks. >> jim, watching apple with a lot of attention the downgrade of best buy, worries about concerns of apple products, 10% of their sales what's your thinking regarding them and all of the negative commentary how much does it match what we expect to see in '19 >> the rally is a past few challenging months for apple a lot of it has to do with trade wars and geopolitical environment. and apple is reaching now more of a cash returns in mature

market for iphone. we layout a scenario, how low could apple stock trade, if everything gets really bad and china says no to the iphone. we don't think it will happen, but if that case plays out, we believe the stock could trade as low as 127 but we don't see that happening. accordingly, we have a buy rating of $200 we believe trade wars while not good, is not going to be the end of the iphone in china, so we believe the down side is 127 but we like the stock here as it has pulled back the past couple of months. >> do you have a percent probability on that bear case? >> put it this way, china represents about 20% of apple's shares, so on the down side scenario of 127, that's the worst case if apple says no to iphone we simply don't think that's going to happen. down side would be 127 >> andy, how low could apple

shares go taking into account services, wearables, stock buy backs? >> you know it is hard to say because the real negative scenario would involve combination of further u.s. china relationship issues. and also i would say increased regulatory scrutiny over the app store policies and if those two things really happened, i mean, regardless of the probabilities, it could be quite a bit lower. jim said the probabilities may be fairly low, but they're real risks we have to think about the longer these things go on. >> jim, i'm looking at apple's price action in the last three months, it is down 23% meantime, twitter is up 21%, amazon down 18, facebook down 10.5 what's happening the way you see it, particularly in the last quarter in terms of sentiment

and what investors are nervous about? how much of this is specific issues with individual companies driving stocks based on size of company and how they see technology? >> great question. a lot to do with apple shifting from growth stock to more value stock. therefore you see them increase the stock. buying back $100 billion, increase the dividend yield, and people realizing most people in america, most people in europe have a smart phone so the market is very mature therefore we look at replacement cycles and are people spending more on the apps, the games, the in store purchasing. the answer is yes. but it has reached a maturity point. therefore, we believe apple is now transitioning hands into a more value return of cash to

shareholders, and regarding how much of it is political versus worries about other things, a lot of it is trade war driven. trade wars are bad for tech stocks there's no way around it a higher priced item means people afford less of it it is bad for tech stocks if we reach a trade war. >> andy, on netflix a sell side saying it is the worst performing faang member of the past month, past three months, past six months, amid concerns about rivals taking over the sand box how do you of netflix in the context of faang >> as much as it is a great acronym, i think of faang as independent companies, and netflix in particular is quite a bit different than most of the other ones i think there's legitimate concerns about competition our view is that netflix is well placed to sort of defend itself against the competition, but

there's no doubt there's a need for increased marketing, increased content spend. and that may put a tapping on the brakes effect on the stock for a little bit still >> jim, here's something i never got. aside from microsoft, not many of the big tech companies have made big investments in gaming on the content side. yeah, you've got amazon now with twitch doing something, but not a huge investment. given that gaming is so much of what drives apple's app store and given that amazon and google tried to catch up in that arena, when you talk about content, why are we talking tv and movies, not about games, and how much do you expect gaming to play into the service area of these stocks in 2019? >> well, we know that the app store is approaching about 20% of apple's revenues. and that's higher than corporate average profitability. so that's a good thing

when you think about the future generation, how they're spending money, it is less i want a soccer ball or bicycle for my birthday, christmas, holiday, it is more dad, mom, i want 99 cents. did i please have this upgrade or this super power or extra backpack or bag for super powers of playing the games that's where the next generation is spending their money. it really is please, please, please, mom, only 99 cents. apple embraced this as a vehicle, whether adults purchasing items like clothing and gifts or children purchasing gaming we believe apple is agnostic to the type of game, but they're very much the vehicle that will allow people to spend on that to come into the apple ecosystem. that's a big positive, and again, because profitability is above corporate average, it's very important >> andy, whether you like the

faang acronym or not, you cover most of these stocks what's your top pick of 2019 >> google. part of it is we think we're in an environment we should be looking for singles and doubles rather than home runs. and part of it because we continue to believe it is an exceptionally well positioned company and search can continue to grow well for a long time >> andy, jim, thank you guys good to see you both social stocks, facebook, twitter, snap all over, off the heels of the senate report on russian social media influence julia boorstin is in l.a. with more of the details. >> that's right. two new reports analyzed millions of post provided by tech companies it finds the russian internet search agency sought to sew discord even after the election, not before it. twitter is off 2.5%, snap down

1.5% facebook and google down fractionally the authors of the report highlighting the company's quote belated, uncoordinated response to these attempts to manipulate voters as well as failure to share more with investigators, also detailing the role played by youtube in russian manipulation, going into their role the most we have seen the first time also talking about posts on instagram with attempts to target african americans, and suppress voter turnout among democratic voters. facebook saying, telling us 20 minutes ago it hadn't seen the report and couldn't comment on spes the quote, we provided thousands of ads and pieces of content to the senate select committee on aejs for review and shared information with the public on what we found. we have gotten comments from the chairman, richard burr and mark

warner, and they're saying they see social media intended to foster open dialogues but can be used to subvert and manipulate public opinion it will be interesting to see how the data is used and also what impact in terms of regulation of the social giants. back to you. >> thank you, julia boorstin when we return, what the interim ceo of intel told me about china protecting intellectual property, the u.s. china relationship and the search for the next permanent ceo. that's all ahead after a quick break. the future of technology investing lies beyond the tech sector. it's about technology transforming every sector.

♪ at pgim, our bottom-up approach uses a technology lens to identify long-term winners. from energy... to real estate... to retail. finding such opportunities for alpha is the true value of active investing. and around the world, you have a partner in that pursuit. pgim: the global investment management businesses of prudential.

the global investment management ♪ there's no place likargh!e ♪ i'm trying... ♪ yippiekiyay. ♪ mom. ♪

welcome back to "squawk alley. stocks coming back in a big way, the dow only down 51 points after being off as much as 315 points earlier in the session. the s&p 500, similar story basically the flat line down just about a point the nasdaq and nasdaq 100 are both in positive territory meantime, ceo outlook for business conditions hitting a two year low, according to a new survey dom chu has more on the results and what's worrying industry leaders. >> this is like you said from chief executive group. they put out a monthly survey polling hundreds of ceos across various industries and size companies and their numbers for the month of december are rather

telling. a two year low in confidence show you how it looks graphically speaking we have seen a steady decline, a trend lower in ceo confidence since the beginning of this year in fact, from the peak back in january, we're off by about 16% in terms of overall ceo sentiment in conditions for the next 12 months this level in december was the lowest level since 2016. big concerns are the cooling economy. rising interest rates, in the fed category and trade and tariffs. china becomes a big part of that discussion, and current levels of corporate debt, echoing concerns that former federal reserve chair janet yellen had about corporate debt situation and the amount of it on corporate balance sheets take a look at this. if we temper expectations for 2019, here are the places we talk about most frequently in terms of sentiment

less optimism on capital expenditures only 53% of ceos say they're spending more next year. that's better than half. better to be proud of. less optimism on revenue increases. 74% of ceos expect revenues to increase next year that's pretty good still lowest of the year both measures reasons to be more constructive. still optimistic on rising profits. 71% of ceos expect profits to increase next year hiring, this is important, guys, we still have around 57% of ceos saying they're going to hire more people next year than they did this year. that's higher than last month. if looking for some sienlgns, something when the chief executives of america are feeling the lease optimistic all year since going back to the eve of the 2016 presidential election back to you, john.

>> nice bit of hopeful sentiment heading into 2019. thanks, dom. nearly six months after intel cfo bob swan was appointed interim ceo, i sat down with him for interview on the latest interview of fort knox, protecting intellectual property he says intel has been meticulous about protecting ip i said does that mean the trump administration doesn't need to push china hard for intel's sake here's what he said. >> we're comfortable with a global facilitation of policies that facilitate global trade, and we have a large market prenls and strong relationships with customers in china. and we want to ensure that policies help us continue to operate in the way we have

become accustomed to over time at the same time, we think protection of ip is extremely important, whether it's policy or regulation or things we can control and technology we developed, that's always been an important part of our company and will be going forward. >> swan told me intel's top executives specifically told the board six plus months ago not to feel rushed in the ceo search. that said, he doesn't expect the search to take six more months >> sometimes crisis will pull teams apart or make them stronger in this case, six months has been great for the company because the team stepped in collectively to fill the void. and our message to the board early on was take your time, you know, get to the right decision. this is the biggest open job on the planet and it's a great job,

therefore don't rush for the sake of speed. take your time on quality. the management team was kind of -- and we've got this we'll be fine during the transition initially when i stepped in to do the role, i didn't quite think it would take this long, so i didn't ask somebody to step in to the cfo role i thought it would be kind of quick, why introduce additional disruption six months later, i'm anxious to have one job, not two. >> again, he does not want to be the permanent ceo. there are internal candidates. you can subscribe to fort knox podcast to hear the whole conversation when it is posted this weekend >> those comments on trade were pretty interesting i feel like he was careful to not say that he would like to see their supply chain and the impact between the u.s. and china -- it's almost like he

would like to see business as is, but he didn't actually come out and say that, that's sort of what i took away from it from between the lines. it is interesting. intel up 2% quarter to date, the philadelphia semiconductor index is down 13.5%, quarter to date how much of that is intel specific and how much is that is it safe to play in semi conductors. >> it is bigger than semiconductor. we saw a reaction after earnings, that's part of it. as for what bob swan was saying about china, intel has joint ventures there but sounds like a lot of companies, got used to give and take on intellectual property and where things have gotten thus far they were comfortable with that said, they don't want china pushing more forcing joint ventures

not speaking specifically of intel, just what i heard from other companies. they like things where they are now, so they're not completely against any pressures to have china hold to certain intellectual property standards. we'll see where it goes. >> great stuff, john thank you. after the break, a closer look at the latest in the u.s. china trade war, how the threat of ip factors in first, look at the dow down 51 points after being down as much as 315 earlier in the session. more "squawk alley." back in three.

keeping our eyes on the markets, rebounding from today's lows, stocks on pace for the worst start to december since 1980 trade tensions between the u.s. and china continue to worry investors. white house trade adviser peter navarro joined cnbc earlier addressing some of those concerns. >> what i would urge people to do on wall street is rather than follow this day to day and get

all excited, go up and down on rumors is let the process take its course in addition to selling them more things which is fine, nothing wrong with that, what we really know is we need structural reforms that protect the technology crown jewels of america and the world. it is not just the u.s. that's the victim, it is europe, it is japan, it is countries around the world that innovate. >> joining us, ben steil, author of "the marshall plan. and jeff moon, assistant trade rep for china. ben, chinese imports from the u.s. are plummeting. u.s. importers are paying double what they were in may. we've got this new phase of the back and forth now as we head into 2019, are we set up where the u.s. is in position

to feel more pain than we have in the past and lose leverage or are signs in the past couple of weeks encouraging? >> the trade war is not going well for either country. chinese imports of u.s. goods is way down since june, oil, agriculture products russia is a big beneficiary of the ship we may be at a low point china is willing to make significant concessions on tariffs. they're willing to make rhetorical concessions on the 2025 industrial policy i think the big question going into 2019 is where the president's mindset is going to be in february if the stock market is in the do doll drums, may want to take it off the front pages. >>does the president want a quick win here is that how things are aligned or is there more advantage in pressing china as hard as possible, maintaining a harder

line sounds like maybe jeff hear me oh, he does now. jeff, i'll ask again, does the trump administration, dozen the president you think have a strong incentive to actually get a deal done early in 2019 or is there more incentive to maintain the harder line as the 2020 campaign season starts to actually kickoff >> from an economic perspective, very much has incentive to resolve this this is hurting business they would like to see this come to a conclusion. from a political perspective, however, i think this is a very live campaign issue that he uses very much to his advantage and may want to carry into the 2020 election i think he's guided more by politics that's why i am not optimistic of a near term resolution. >> you said a keyword,

rhetorical talking about changes for 2025 we heard the comments from peter ma v navarro. what does that mean and is that enough for a trade deal to take place? >> the 2025 industrial policy vision china has is fundamental to china's new nationalist vision of its role in the world, and they're not willing to jetison that they'll give the president morsels to allow him to declare victory. he did it with nafta, with north korea, and i think president xi is thinking why not do it with us. >> the chinese think about the tools in their tool box, they have a big economic forum this week, are they going to lower targets on their own 2019 growth and to what degree could they say pass a tax cut on their own consumers? >> they may lower the economic

target from 6.5 to closer to 6.0, and it does appear they may introduce some stimulus to do something for the economy a little bit, because things seem to be trending downward. >> ben, when you think about the importance of china as a political issue, to what extent is toughness in china important, particularly in must win, battleground states, versus things like soybeans the more important factor different things play to different sort of sub groups in the same base. >> i think the president will want to take some of this off the table. for example, he needs a real win with the agricultural hartla heart land, but he is not going to eliminate all tariffs he needs to come into 2020 saying i am going to be tough with china, particularly since china won't acknowledge ip

theft, forced technology transfer he has to keep some of that in reserve. >> doesn't make it easy to see which way things go from here, despite peter navarro's calls for less volatility. let's get to sue herera for a news update. >> good morning. here's what's happening at this hour former fbi director james comey is back on capitol hill to continue his closed door questioning by the house judiciary committee. this is all part of an investigation into decisions made by the justice department and the fbi during the 2016 presidential election. north korea releasing pictures of kim jong-un visiting his father's mausoleum fighting continuing in yemen ahead of a cease-fire in sweden last week that left at least 12

dead and 25 others wounded from both sides at a strategic red sea port the cease-fire expected to take effect tomorrow. hyundai unveiling a new system for the santa fe suv. it uses fingerprints to unlock and start the car. the technology is built into the door handle and ignition button. owners register their encrypted fingerprint data for that vehicle. so far it is only available in china. interesting concept. back downtown to you guys. carl >> thank you, sue. european markets are closing. seema mody has theaction >> a mix of politics as they discuss the second referendum, and am eurozone inflation coming in softer than expected at 1.9%, versus consensus of 2% also as investors try to assess the health of the european

consumer central bank put an end to qe and asos is cutting outlook. it isn't just any warning. they said they experienced significant deterioration in the important trading month of november, blaming unseasonably warm weather in the winter, economic uncertainty and weakness in clothing sales and reaching across the retail landscape in europe, not just the uk names but other companies, the retail sector as a whole has declined 9% this year, slightly underperforming the u.s. retail sector which is off by 7%. rest of the week, dominated by on-going brexit talks as the idea of a second referendum is getting a lot of attention, bank of england meeting thursday, as well as vladimir putin's press conference with foreign

journalists where u.s., russian relations is expected to be high on the agenda. guys, back to you. >> thank you very much seema mody. the major averages dow down 100 points. the question is whether the 2600 level which had been seen as a floor is now resistance. we couldn't quite get there. tom mclel and joins us you'll get clear, actionable alerts fidelity.

about two hours into trading, with markets pairing earlier losses in today's session, following the dow's lowest close since may on friday bob pisani has more from the floor. >> hello finally an oversold bounce in the most beaten up sectors we broke through the december lows and people watched technicals very much. 940 or so, broke through this, took a quick leg down. that was clearly technical selling. finally, we are saying when are banks going to bounce. finally, they kind of led the turnaround we had jpmorgan go positive, and kbe bounced first into positive territory. then oil, oil stocks oil dropped to november lows in the middle of the morning and

oil stocks turned around before oil turned around, moved in positive territory chevron went positive and some beaten up oil drillers moved into positive. dow leaders, boeing, caterpillar, dow duponts that do better on hopes for trade talks, no headlines out there, after navarro didn't say much other than oversold bounce i say the big hope for a real rally this week is with the federal reserve. it is simple, folks. back in september everyone talked about three rate hikes in 2019 the market convinced itself based on body language that maybe it will only be one. that's the key story where is the fed coming down in terms of 2019. what's moving markets. three things, tariffs, fed, global growth. trade negotiations on-going. in my mind, mostly positive headlines the past couple of weeks. the fed is trying to signal

fewer rate hikes we'll get that answer in the next week. the slower growth seems to be the thing spooking the market. and it is hard to get an answer to that. meantime, you see the problem we have technically, lower lows, lower highs for the s&p 500 for the entire quarter let's see if we can hold at low levels now guys, back to you. >> see if we can, bob. thank you for that for more on today's action, we're joined by the editor of mcclellan market reports, he comes to us armed with some charts great to speak with you today. >> good morning, morgan. >> i'm going to channel mike santoli and his column in terms of what we're seeing in the market now, seems to be a brewing debate whether it is an ugly correction or whether we're looking at bear market action. what are the charts telling you? >> you can make either argument. i fall on the side of believing in the bullish case because we're in one of the seasonally strongest months of december

most of the seasonal strength in december occurs the last half of the months, after the 14th, which is friday. we're in options expiration week, one of the seasonally strongest periods there is to find we have to get less worry out today. saw the retail gods in charge of posting the close friday you have to like that level. they don't want a green number yet until they get the buying done would rather have everybody disbelieving in it, given the retail investors to disbelieve, bailout, abandon shares into the strong hands, but i expect seasonality to start working. >> and tom, in terms of some of the technicals or factors you're looking at in the market that lead you to believe that, what are they >> we have seen them put call numbers, aaii, american association of individual

investors showed percentage of bears highest since 2015, and all of this is happening at the weak point of the seasonality, around december 14th that's the average low point of the month of december every year, now heading into the strong seasonality also the third year of a presidential term, nearly always an up year i count those starting november 1st to january 1st that's the election cycle. only one time since the 20th amendment in 1933, one time we had the third year be a down year, that was 1939 when they were marching through poland if you don't have conditions like that, third year should be an up year need to wait for the market to realize that, that it veered off course, and needs to oversteer to get back on course. >> that bull bear ratio with pmi has been given by a reason to expect a good one month or six month return others say it is worse now than

it was at the february lows. how much washout do you want to see on the percentage of s&pers below the 200? >> that's one of the important measures you don't know that that has given you all until it turns up. we're seeing advanced decline numbers that aren't looking too bad, seeing it in the most liquidity sensitive issues people talk about the bond closed end funds are contaminants, think it ruins advance decline data i find the opposite. they're more liquidity sensitive and will tell you there's a problem ahead of time and also when it cleared up advanced decline line for bond closed end funds for new york stock exchange has turned up, moved above an important moving average. saying liquidity has been restored, just we can't get everybody to believe in that yet. >> tom, to what degree to the market signals you're looking at tell you that things are vulnerable now perhaps vulnerable to external

shocks but if there are none, then there's room for surprise rally, given that there are questions on brexit, there's trade tension with china, how much should we think of that vulnerability as being an issue based on what you're seeing in charts? >> you're stating the question well, john if the market is supposed to go up and doesn't go up when it is supposed to, it can be a sign of weak n weakness the fed is yanking 50 billion in quantitative tightening. if they would stop that and ease up on rates a little bit slowly higher then we wouldn't have as much depression in the fact i think there's liquidity hiding, i think it is time to get back to work and you'll see it rush back in. i don't think we have another ten year up trend, there will be weakness later in 2019

autumn, and late february, mid april, more of a trading top, but there's going to be opportunity for market timers. right now while we are in seasonal strength, i expect that to start working again >> tom, we had you on a couple weeks ago, showing us the relationship between apple and the broader market from its highs, it is down like 29%, although apple is up 1% today. what is that stock and its relationship telling you now >> that wasn't good news for the overall market to see apple continuing to breakdown. used to be that ge was the great bellwether, you saw the market and ge charts disagreeing, you want to listen to ge they lost that role because of il its own problems and apple has taken it over. it wasn't good to see apple breaking down the last three weeks. now that it is leading the way higher, i expect that strength to bleed into the rest of the

market, start instilling more confidence. >> tom, always great to get your thoughts thanks for joining us. >> thank you and coming up at the top of the hour, bond king jeffrey gund gund gundlach sits down with scott walker first, rick santelli had a busy morning, but isn't done yet. what's on your mind, rick? >> jon, we have to discuss some comments made by peter navarro that's what we're going to talk about after the break. duncan just protected his family

with a $500,000 life insurance policy. how much do you think it cost him? $100 a month? $75? $50? actually, duncan got his $500,000 for under $28 a month. less than a dollar a day. his secret? selectquote. in just minutes, a selectquote agent will comparison shop nearly a dozen highly-rated life insurance companies, and give you a choice of your five best rates. duncan's wife cassie got a $750,000 policy for under $22 a month. give your family the security it needs at a price you can afford.

lelts get out to scott walker -- let's get out to scott walker hey, scott, what's coming up >> carl, thanks so much. almost a year ago to the day, last time we were here in los angeles. we are back to talk to jeffrey gundlach about the state of the markets. so much is going on. he is making bold predictions. last week said the fed was on a suicide mission, raising rates while the deficit is rising as well we'll get him to expand on that. he's also launching a new product investors may be interested in, we'll talk about that and more, at the top of the hour and exclusively here on cnbc looking forward to that from here in los angeles, carl. >> scott, looking forward to hearing what he has to say about

rates, especially on a week you have the fed meeting, boe, boj, and ten year at 2.86% now. >> especially, morgan, on a day with the president tweeting again about what the fed shouldn't do, when you have the op-ed in "the wall street journal" about what the fed shouldn't do, and now we'll get jeffr jeffrey's opinion on that. he has the ability to move the market as we have seen before. he said rates would go to 3%, the stock market would have trouble if that happened there's a lot to talk about, given the fed meeting, the trade situation with china, real state of the economy, whether the stock market is simply going through a run of the mill correction which we haven't faced that often or something

darker and deeper like a full fledged bear market. we'll get into all of it at the top of the hour. >> he did say a long time ago 3.25 would be a game changer can't wait that will be starting in about 15 minutes. rick santelli talked with peter navarro asking what's causing the market volatility. >> the predominant factor hands down and at the top of the list is federal reserve policy. donald trump's instincts are always right on this and months ago he started pointing out that the fed was going too far, too fast right now we have zero inflation for all practical purposes so on wednesday, the only argument i hear for the fed to raise rates is that they have to exert independence from the white house. this is a bad argument i think what the fed should do is what they said they were

going to do which is look at the data >> let's get to rick santelli with the santelli exchange rick >> my goodness, so much different ways to go first of all, i completely agreed, we now passed the tipping point, it was probably in early october of global liquidity. it isn't that we started down the road i know that he calls it a suicide mission. i think that's more europe and japan, doing far too little, far too late in the game see, there's no easy answer. see, this is the holy mack ral we can talk about lots of little issues, and they're all important, but there are two glaring issues one is central banking it is not just our fed to be fair to jay powell and fair to the president, i think he has a right to his own opinion. they made a big to do about him kind of getting involved in the independence it hasn't helped him if many believe the fed and their guide

an -- guidance may in a small way effect them. i think at the end of the day, peter navarro is right look at the data, do all this guidance and leading investors by the nose was slightly thereafter. but it's now time that there's no free lunches. if you want to invest, there's risk and for risk, you get reward ultimately the fed has to put risk and reward back into the public venue but, to be fair, the other holy macro is definitely tech and i.t. it's been a rough way to get there and i thought peter did a nice job because what many that i discussed are most worried they don't want little morsels to be a declaration of victory billions here and billions there of commodities going to china is very important to that group and if you're in the auto

business, tariffs are very important to you but all those billions are dwarfed by the notion of how many trillions are at stake ultimately and the future leadership revenues and security of tech and i.t., think 5g, global standards, and that is a big fish to fry. both of these huge macro issues aren't going away overnight or anytime soon morgan, back to you. >> rick santelli, thank you. as we head to break, take a look at some of today's laggards on the nasdaq 100 which is hovering right around the flat line cognizant, workday all down greater than%. 2 we have more "squawk alley" after a break.

at fidelity, our online u.s. equity trades are just $4.95. so no matter what you trade, or where you trade, you'll only pay $4.95. fidelity. open an account today.

you'll only pay $4.95. ♪ there's no place likargh!e ♪ i'm trying... ♪ yippiekiyay. ♪

mom. ♪ amazon telling some of its big brand partners to cut the c-r-a-p, it's an acronym, according to a report in "the journal" this morning. deirdre? >> reporter: that's right, jon inside amazon there are these products known as c.r.a.p., short hand for can't realize a profit they're things like laundry detergent or cases of bottled water that koss less than $15. they're bulky and heavier and

easier for the consumetor to get delivered but expensive to ship. amazon is increasingly taking aim at c.r.a.p. products as it grows its bottom line, they are unloading these products and pushing manufacturing to change their packaging which may not be that surprising given amazon's size and scope physical discipline is relatively a new concept to the company. profits were spotty but most recently it's reported four straight quarters of earnings over a billion dollars now the engines have been high-margin businesses, smaller businesses like cloud computing and advertising. but now after years of focusing on growth in e-commerce amazon dominates the market it, in many cases, can push manufactures to change

because e-commerce is not a one size fits all environment we are constantly evolving our offerings to be sure we're providing the right brands, sizes and value. amazon may be trying to boost profitable in its core business. remember there are other amazon businesses that amazon puts profitability aside such as devices, defending turf in india where it is still trying to grab market share back over to you >> an interesting look into the psychology on prices deirdre, thank you very much markets are hanging in there the dow down 50. you have boeing up 2%. apple 1.5% financials up half a percent "squawk alley" back in less than three minutes.

for a while this morning it looked like we might get the lowest close of the year at 2581 upside reverse al interday gives us that and a little bit of cushion. dow down 34 points as the chip stocks are not doing too bad today, jon >> they are chipping in on a reversal, applied materials, lam research, micron, broadcom >> we played some sound with your interview with the interim

ceo. we have double line ceo jeff gundlach with scott wapner on "the halftime report." it will be a big one given all the news with the market this week >> so much to ask jeff about equities, corporate credit, the fed, global growth let's get to los angeles and a special "half. for the first time in decades every major investment group is on track to close lower for the year stocks, bonds, commodities the markets may be at a crossroads and few people have their finger on the pulse of what could happen next like doubleline's jeffrey gundlach >> there are negative parts, unintended consequences, negative parts to this tax package pushing upward 3% will put a drag on the stock market >> today the bond king is with us live in los angeles for an hour for an exclusive interview.