me, if it goes above $3, settles there maybe a couple of days in a row, i think it continues on higher. >> thank you so much joining me with more on that that does it for "the exchange," everybody. i'm tempted to try, where's the microphone i'm going to go join melissa and bill on "power lunch" right now. >> thanks, kelly see you in a moment. i'm melissa lee. bill in for tyler today. new at 2:00, two big warnings taking down the bulls. what caterpillar is signaling and what that means for chips and technology and a monster week ahead for the markets the biggest week of earnings first fed rate decision of 2018. >> i'm gibill griffeth. stocks tumbling from the start

a busy week. off session lows dow down more than 410 points at the low so far caterpillar responsible for about a quarter of the decline so far today tech and energy have been the worst performing sectors so far in today's session let's kick things off right now. bob pisani tracking the action for us from the floor of the nyse bob? >> the nyse as we call it. we're clawing our way back 40% of the losses regained already. 3-2 declining to advanced stocks with 7-1 at the open and take a look here. three things matter here a quarter of the way through earnings season. move the markets number one, perception that the fed central bank is dovish number two, expectations of a positive trade outcome for better or worse and finally, this is today's lesson, slower global growth and nvidia and caterpillar are telling us that earnings expectations are still too high you see five or six semiconductor stocks tend to move things around and dominate

the smh. taiwan semiconductor and texas instruments and broad commons, we like to call it same with caterpillar, a few big global machinery stocks in this space being caterpillar, cummins, for example, and oshkosh specialty vehicles a big debate of whether we go to zero or negative earnings growth first quarter expectations just above 2% right now and if that goes to zero, folks, you'll hear a lot of people squawking. back to you. >> bob pisani. let's get to caterpillar shares tumbling on the weak earninear earnings and guidance. machinery and multi-industry analyst at j.p. morgan ann, welcome do you have a buy on this company? >> i do, actually. i did lower my price target today to $172 and that was a

multiple lower 14 month on next year's earnings estimate as opposed to 15 month we have prior which would represent mid cycle. after today, we have to recognize that maybe 2019 is post-mid cycle, though, we still do not believe 19 is the peak where caterpillar is currently trading. >> you not only took down your numbers to basically match what the company is now saying but took down even, you know, the valuation that should be trading at is that just because you think it's late cycle or is there just more uncertainty in the business now? >> i think it's the latter there's just more uncertainty. we look at china and we look at gdp growth being revised down there. we do anticipate that the chinese government will invest in infrastructure, which should be positive for caterpillar's business in china, but with a slowing gdp growth, that may put pressure on demand for hard commodities that would directly

impact the profitability. >> this group went up significantly since the december 24th lows and i'm wondering if at this point, the declines we're seeing across the board, whether you take a look at parker hanifin, if the re-rating we're seeing is warranted at this point or overdone. >> great question. we think it's way overdone i mean, today, caterpillar's problems were really caterpillar specific it was really manufacturing inefficiencies that drove them and right up and the business which won't repeat so, you know, if you strip back and look at the fundamentals in u.s., we still really like companies like oshkosh more domestic leveraged and not as dependent on china one way or the other at all we do think this pullback has been overdone. it's not the first time caterpillar has done this to the group and those were buying opportunities last year, particularly, q1 last year when

the cap said it was high water mark of the year but everybody read it as the high water mark of the cycle. >> what about the longer term pullback on caterpillar? from the beginning of 2018, when we were hearing about the tariffs, the stock has gone from about $172 which is your current price target down to $120 chara. are you suggesting wall street overreacted to the slowdown and the tariffs that we've seen from china? >> we always believed that investors were overreacting to the tariffs. while it has increased costs for caterpillar, they had been able to push price increases through because demand has been pretty strong in fact, increased prices from 1% to 4% starting january 1st on top of mid year price increases last year. we thought that the tariff-related headline news was overdone and baked into the stock and then eventually, we'd come to some agreement with china. see what happens this week and on march 1st, but --

>> i'm sorry to interrupt. when it comes to bali, we're watching that story closely. is there an incremental impact on caterpillar or coverage universe with bali, as things appear to be still in flux in terms of what they might be exposed to and liabilities >> yeah, but remember the big exposure for caterpillar still really is coal there may be some issues, unlikely liabilities, but you may have mines shut down for a while but caterpillar is exposed to very global mining customers and, you know, we are continuing to see cap x spent increase, although not expecting a huge increase this year, about 5% to 6% in cap x. >> vale down nearly 16% today. ann guighan. media with worst day in months securities joins us.

he lowered nvidia to $170. hans, great to have you with us. what do you make of this warning given that they already took down the fourth quarter just in mid november does a company have a creditability problem at this point? >> yeah, a little bit. but keep in mind, they thought entering the quarter, the inventory situation, it would be two quarters not too bad there. what you saw this morning is that data center which can be lumpy, also weaker than expected and the new product call for the gaming market. so a multifactor dynamic that takes us into the second half before we see kind of the resumption of growth >> i'm actually going to ask you the same question as the caterpillar analyst because semiconductors is a group that really has risen off the december 24th lows if they're off like 20% on the smh since then and at this point, given what we've heard from intel and what we're hearing from nvidia,

should we be rerating the sector across the board >> i think so. i think right now, china, macro issues, inventory issues broadly are something to keep in mind. we're hoping that the second half is going to be better, but we really don't know we've been telling clients to keep focused on names that are immune to some of these things like xilinx, for example, or a&b impacted by this krcrypto thinga well increased market share opportunities. a re-rating probably in order but keep in mind to focus on names that have very clear product cycles that immunize them somewhat. >> what do you think happens with their business in china >> you're talking nvidia >> yes >> well, everything is tough they have business from a demand perspective, i think china was probably weaker than expected in the chinese new year

inventories in the channel, mainstream pascal gpu product have not been relieved probably going to take another quarter or so. it's just good old fashioned inventory dynamic that's made worse with the china trade tensions so two more quarters of pain. >> nvidia not too long was the hottest stock in the market. it was immune to some of the declines we had seen in other chip stocks as well as the whole technology field what happened? did the market get it wrong? i'm sort of asking the same question i asked a little while ago. did the market overguesstimate what this company was able to deliver as they were pushing it ever higher and higher a couple of years ago >> that's right. i think a crypto dynamic will end up being a full year of pain not a one or two quarter thing but everything kind of missed that and most of us missed that. the data center which has grown at a 50% year clip is just

taking a pause and add insult to injury with the new product which is okay but it's not relatively speaking as good as the last product from a couple of years ago on a sequential basis so we've got a number of factors here and i think management is taking some credibility hit here as well as they indicated they understood the dynamic in the channel and they don't, so a lot of things just going wrong. >> why do you stick with the buy rating on the stock hunts? you say it's another one or two quarters of pain here. at this point f you take a look at estimates, it's staggering to think that prior to the third quarter, guidance on the fourth quarter, the revenue estimate was $3.4 billion so a full billion dollars over what they're saying fourth quarter will now be. so there was a huge gap between what they are actually seeing in a wall street had guesstimated at that point. so i'm wondering, what gives you the confidence to say at this point you think management has got a handle on what their

visibility is? >> i think they have very little visibility this year the recommendation for this stock is only for longer term investors. our checks indicate that they continue to have industry leadership and gpu acceleration and gaming and autonomous driving. from that perspective, i don't think intel anytime soon is going to challenge them there. this is a longer term dynamic. doing a downgrade off of this announcement does nobody any favors i think near and midterm investors are okay to stay on the sidelines. longer term investors, two or three years out. this is one of the highest quality names and h continue to be after we go through this. >> thank you for your take we have two big earnings warnings ahead of a huge week for investors. we have apple, amazon, microsoft, among the big names set to report results this week, plus the fed their first rate decision of 2019 will also be this week as

well as fed chair powell's news conference you add to that a flooded economic data. the biggest point, of course, is friday's jobs report and oh, yeah, don't forget the trade talks in dc with the chinese let's put it all together. samantha, global market strategist with j.p. morgan ets. what a week we're going to have here >> that's a lot of things. >> what will we learn here what are you anticipating? >> the big thing is tech companies are going to report and we want to see whether the strong dollar hit them in q4 or whether they were able to kind of get through that. i also think everyonewill be watching jerome powell and watching the fed and see his language around balance sheet and just rate hikes for 2019. >> do you think, this is not the time they're going to expect to raise rates here >> they're definitely not going to raise rates but i think it's indicating, is it one, two, or could it honestly be zero hike this is year if you think they're close to the neutral rate, which we do, it means they don't really have to raise rates >> how confident are you in

earnings estimate for this year given what we see from caterpillar as well asnvidia >> i think there's way more uncertainty and volatility around earnings estimates than there was last year, but i would say we were so sure of things last year and that didn't matter investors didn't care and equities obviously had a very difficult year i would say that even though earnings growth is coming down dramatically growth-wise, valuations look really good so we're pushing and looking back at that fundamental. >> i'm just thinking about the earnings that bob pisani just mentioned a few minutes ago. we're talking economic recession. maybe it is an idea of an earnings recession that there's a couple of quarters where earnings don't grow. >> it's bold to say our cycle is still alive, we don't know because the cycle feels long and drawn out and like you mentioned, kelly, we've had interesting dynamics with earnings maybe it doesn't look so typical that we have a recession and then have a bear market. it could look different this time which feels weird to talk

about but last year was an odd year earnings were up and equities were down for the year. >> speaking of on, a couple of odd jobs numbers the last few months here. what are you guys figuring out we'll have on this friday? >> continued strength. right, the data came in weaker but that was unbelievably strong so the labor market is still really tight and things are still really good. it's more subtle i would say under the surface but the labor force participation rate is going up we're drawing in the marginal workers which is good because we know we need them but i think it kind of skews the jobs picture a little bit because it has the ability to bring the rate down. >> wages creep up though. >> yes, wages are creeping up. >> you're talking about how odd things might be. if i'm an investors at home, that doesn't give me much confidence or reason to invest in the market at this point because as you had said last year, earningswere great and equity markets were terrible what makes you think things are going to be better this year or what do you tell an investor >> we're saying you still have to be focused on the long-term

and it's harder. i will give you that we say that to clients and they still feel jittery we're preparing for late cycle because we're in it and adding more good quality fixed income because rates are going up and we want equity exposure in a more risk cautious way and hedge component to it and a lot of volatility dampening and willing to give up a big piece of the upside as long as we can stay invested >> much more defensive >> more defensive. the only out of consensus point of view is like it keeps going and no one is positioned for that >> right and it's hard because we still like em, so let's throw into this we're still all talking about emerging >> clients don't even want to hear that. >> that's like loving the cubs >> that was a sports reference i didn't get >> i'm sorry >> just smile and nod like i do with bill. >> samantha for j.p. morgan.

always good to see you see you later. as we have been saying, caterpillar, nvidia, biggest drags on the market today. broad based sell-off halliburton and exxon and chevron. biotech with the worst day this year amgen among the biggest decliners there and coming up, a look ahead to the next big obstacles for the market wednesday's fed meeting. what will they do or jay powell say at that press conference stay with us

♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest.

amazon prime video so when you say words like... show me best of prime video into this... you'll see awesome stuff like this. discover prime originals like the emmy-winning the marvelous mrs. maisel... tom clancy's jack ryan... and the man in the high castle. all in the same place as your live tv. its all included with your amazon prime membership. that's how xfinity makes tv... simple. easy. awesome.

not just a busy week for earnings but the economy in focus as well leading up to wednesday's fed decision just about 48 hours from now we start the week with some interesting new data which steve liesman is here to share with the whole class. >> thanks, bill. we began the week with an ugly business outlook for business economics. it was taken during the shutdown and that might have influenced, hopefully, these numbers when you see these as well. 29% net said sales rising. 26 points. third quarter. numbers kind of similarly ugly for profits and for capital spending employment is the only bright spot up by 2 points. 25% net rising cap x, 26 down 13 points

and the plans for capital spending in the next three months, fallen below the level of before. tax cuts enacted and no effect on hiring or spending plans. although it is higher for goods producers. some good news 77% say tariffs had no effect on hiring or spending plans and several other reports on the way this week. hopefully, they'll be a little better you have the name survey that came out today consumer confidence tomorrow i'm watching these confidence surveys more than i have been because they're telling us a different story. the fed decision wednesday, you talked about that. and also watching the home industry very carefully. jobless claims on thursday and then the big report, jobs on friday 170,000. i called the ba today. i said, what about the data? they said, we'll get back to

you. >> not yet >> it sounded like they were dusting off the computers and everything >> answer the phone. >> dust the phones did answer the phones but i think a lot of dust on the computers after 35 days. >> with retail, for example, put it out as soon as they can >> you're raising a very interesting question, as you normally do, which is if this one was delayed, does that mean the next one start the cascade? i know they needed two weeks to catch up on retail sales and then they need that to get gdp out and wonder if it's several months but they said they'll be back >> stay with us, steve let's bring in bill nelson great to have you with us. you heard from steve, we've got the fomc meeting and from your standpoint, what is your snapshot you would give to the public of where you see the economy at this point? would you say it's, you know, the nabe survey, not too

optimism ik aop optimist optimistic every meeting is live. there's a press conference at every single meeting and we've got a fed here who won't have a lot of data because of the government shutdown and also got a fed chair who has in the past couple of months when he's ad libbed off the cuff, answering questions, create volatility in the markets. >> there's no question not going to raise interest rates at this meeting. the only real question is how to modify the forward guidance. the statement says that the committee thinks some further increases in interest rates will be appropriate for hitting their dual mandate i expect that language to be softened some. widely expected to be softened some hay be necessary instead of will be necessary there's other steps they could take and use of the word patient recently in speeches and testimony and usually words are tried out before the statement or chosen for the statement because they've already been

used on the other hand, powell is not a big fan of forward guidance to lock them in and take too strong of a signal that rates are done going up but at the same time, i think what's interesting about current situation is that over the upcoming year, there are two sided risks to interest rates for the first time since i'd say, 2008. interest rates could go up or down >> steve, something about his answer made you go, huh. >> well -- >> what was that >> i was going to ask the question i make a statement in the process. bill, i've been looking back a what fed officials have said and i've looked back and read carefully their policy statement on the balance sheet i don't feel like they're ready to announce a policy change in the run-off of the balance sheet. they may be thinking about it. they may talk about it, but i mean, it could happen, but i wonder how much, "a," the market is geared up to hear that and "b," the extent to which the fomc is ready to deliver it. >> they've been very careful

they've been running off their securities for a year and a half as the securities decline, so too do the deposits of the fed, also known as the reserves they want to conduct monetary policy like it's being doing and at the same time, want a small balance sheet to have the prints and interest payments shawl mal possible they don't know the smallest possible level that would be abundant and sort of a "bird box" challenge that they face. what's been surprising is that some signs of tightness in the markets for reserve has shown up even though they really weren't expected for another several years. what you see in the minutes for the last couple of meetings is the fed beginning to prepare for the possibility it's going to have to conduct policy at least for a while with the reserve somewhat tight i expect them to announce some indications of a plan of ending the run-off but usually, they discuss a plan in the meeting. the staff comes back with a

final plan that's voted on you could see a more concrete plan coming out in march i think there will be some indication from chairman powell in the press conference that the pieces are coming together and that they're likely to make a change >> steve, what's going to be, i understand we don't have a statement yet, but what will be your first question do you think at this point to the fed chair >> it depends a little bit on the opening statement. i think bill is right to the extent we get balance sheet information, it will be in the press conference and i think given your question earlier about misstatements about the chairman, i think he's going to want to get this right so i think -- >> is he going to pull a piece of paper out i hope he does i hope he has notes. >> whether he has a piece of paper. >> the opening piece is usually written out and i think that's where we'll get the balance sheet information. now, i want to know upon what criteria they are going to

change the balance sheet reduction plan that would be something i'd want to know. i'd also want to know, you know, what the criteria is for hiking at this point and i'm not giving away all my details at this point. >> last point, bill. >> the fed has been very reluctant to surprise the market with the tightening and deliver surprising easing, ending the balance sheet run-off is uneasy so they might be willing to move faster than we expect. >> something to think about. >> thank you, bill bill nelson and our own steve liesman. >> thanks for having me on. the dow briefly down more than 400 points today and off the lows but health care remains one of the worst performers, only real estate and consumer staples in the green key stock reporting on earnings tomorrow that's pfizer. worst dow performer so far this year is a turnaround coming i've had y i've had y prestigious jobs over the years. news producer, executive transport manager,

and a beverage distribution supervisor. now i'm a director at a security software firm. wow, you've been at it a long time. thing is, i like working. what if my retirement plan is i don't want to retire? then let's not create a retirement plan. let's create a plan for what's next. i like that. get a plan that's right for you. td ameritrade. ♪ gimme two minutes. and i'll tell you some important things to know about medicare. first, it doesn't pay for everything. say this pizza... is your part b medical expenses. this much - about 80 percent... medicare will pay for. what's left... this slice here... well... you have to pay for that. and that's where an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company comes in. this type of plan helps pay some of what medicare doesn't. and these are the only plans to carry the aarp endorsement.

that's because they meet their high standards of quality and service. review aarp medicare supplement plans and their rates in this free decision guide. call united healthcare insurance company or go online. visit aarpmedicaresupplement.com to request yours. even apply online... any time. oh. speaking of time... about a little over half way and there's more to tell. like, how... with this type of plan, you'll have the freedom to choose any doctor who accepts medicare patients. great for staying with the one you know... or finding... somebody new, like a specialist. there are no networks and no referrals needed. none. and when you travel, your plan will go with you anywhere in the country. so, if you're in another state visiting the grandkids, stay awhile...enjoy... and know that you'll still be able to see any doctor who accepts medicare patients. learn more with this free decision guide.

call or go online to request yours. tick, tick, tick, time for a wrap up. a medicare supplement plan helps pay some of what medicare doesn't. you know, the pizza slice. it allows you to choose any doctor, who accepts medicare patients... and these are the only plans of their kind endorsed by aarp. whew! call or go online and find out more. hi, everybody. i'm contessa brewer. here's your news at this hour. patrick shanahan leading at the pentagon to discuss u.s. nato relations. shanahan hasn't been tasked to

implement a full withdrawal from u.s. troops from afghanistan russia releasing video of one of its fighter jets trailing a u.s. reconnaissance plane over international waters claimed the jet approached over neutral waters of tbaltic sea hundreds of people in front of the parliament asking for the formation to investigate the death of migrants in the mediterranean sea and let a migrant rescue ship disembark. been stuck since being rescued january 19th 33 years ago today, the space shuttle challenger exploded just 73 seconds into its mission. all seven astronauts died including teacher christa mcauliff prices for both brent crude

futures here west texas intermediate, $52 per barrel and as we talk about the usual suspects, we talk about some of the demand concerns and supply concerns. weaker data out of china, profits that industrial companies taking a dip and supply issues after reporting an increase in the number of active u.s. rigs on friday. more supply, less demand, weaker prices speaking of the weaker prices, check out what's happening with the natural gas futures. price gains and now price declines after forecasts show what could be a more normal or even warmer than normal temperature for february back to you guys >> thank you right over to mike santoli for trading nation. >> look at the dow's worst performing stock of 2019 it is about the report earnings. pfizer is down today also falling nearly 9% this month ahead of it release before the bell that's tomorrow. so is there more pain to come for pfizer and big pharma?

with oppenheimer and gina sanchez, global. worth noting, pfizer was a strong stock last year and big pharma had a good run but where does that lead health care set-up to you this year? >> we're bullish on health care, more so the medical device side rather than the pharma side. for us, large cap is very relatively high dividend yield and a great second half of 2018 benefiting as that safe saichav asset. our concern is a source of funds as risk taking slowly comes back to the market and start to see signs of that pfizer today breaching the 200 day moving average for the first time a lot of support at $39. so we don't necessarily expect a lot of downside here we just see more attractive opportunities elsewhere in the sector >> gina, some people would say maybe it's still pretty good environment to play defense.

where do you come down on that >> i agree it's a good environment to play defense on but the issues are very pfizer specific putting bets on the oncology markets, more and more competitive and on top of that, really putting out combination therapies that nobody really knows how those will be financed, so these issues that pfizer is having have to do with where pfizer has laid down their chips. so they've really made a bet on the cancer market and have to see how that plays out this year >> of course, a lot of the big pharma companies making acquisitions in that area which could be a risk or opportunity depending. thank you very much. appreciate it. for more "trading nation," head to our wbls eb site or follow u twitter @tradingnation ahead on "power lunch. white house press secretary sarah sanders to hold a briefing the dc agenda, now that the government is reopened plus, cnbc is partnering with fintech investing in acorns the ceo of the company joining

us next. apple with first quarter results tomorrow after the bell should investors be worried? all that and more when we continue on "power lunch." >> now the latest from tradingnation.cnbc.com and a word from our sponsor. >> when markets are volatile, resist the urge to use too much leverage leverage is a double edged sword and when markets are calm, it's easy to forget the downside of leverage when volatility picks up,uickly. if you're forced to close out, it will likely be at the worst time in price.

♪ hawaii is the first state in the u.s. to have a hundred percent renewable energy goal. if we don't make this move we're going to have changes in our environment, and have a negative impact to hawaii's economy. ♪ verizon provided us a solution that lets us collect near real time data on our power grid. ♪ if we can create our own energy, we can take care of this beautiful place that i grew up in. ♪

welcome back a lot of big headlines out of dc today. howard schultz considering independent run for president. key china trade meeting on the agenda later this week and cbo estimating the government shutdown cost $11 billion over the past five weeks. here to weigh in on all of that plus a new "wall street journal" nbc news poll is stephanie miller, with hike capital markets and robert costa, national political reporter if the "washington post." howard schultz running, everybody in the democratic party said would be a terrible thing and basically mean the reelection of president trump. are you surprised the response hasn't been more positive?

>> no. i wish i had something super differentiated to tell you but just really clear that an incumbent party really can't have all that attention and oxygen sucked out of it. in this case, the democrats, that's who schultz would be fighting with and they would really lose a lot of momentum and potential voters if he were to run but i don't see any chance he could actually win. >> i hear that and like the point last hour that ultimately, you need to get through the process one way or the other but robert costa, why wouldn't he be stealing votes from the republicans? i guess greg's point is the people to vote for vults on tsc not people to vote for trump anyway it wouldn't be they left trump but just showed up at the polls period i just think that he would be stealing from some center-right people who wouldn't want to vote for trump's reelection. >> many democrats still have nightmares about what happened in 2000 when ralph nader ran on the green party candidate ticket and he, in effect, the argument

of some democrats, cost al gore the presidential election. talking people close to schultz, they say their belief is if he does run, he could try to pull, as you said, from some republicans, moderate republicans who may be turned off by president trump and some democrats who may not like the leftward drift of the democratic party. it's tough unless you have a billion dollars to spend and mount a real independent campaign we saw how challenging it was for ross perot in 1992 but that's the political path. believing both parties are going too far toward their base. >> i'm also thinking about jamie diamond and there's been a number of ceos who have done quite well and probably more centrist than either party, at least the energy in the party at the moment and someone like that could come out and potentially run an independent campaign, right? or is that route completely over, a total dead end and no

prospect for anybody of that kind of philosophy right now >> you could flirt with the idea, talk about it with friends on wall street or get encouragement at davos but you have to make a real effort to run for the national level at presidential politics. the most telling example is michael bloomberg. he's decided if he does run, it would be on the democratic side because he knows the infrastructure within a party is almost necessary if you really want to compete. jamie diamond, if he wanted to run or howard schultz, you have to get in right now and build your own party within the whole u.s. system. >> like a mcchron in france. >> let's move the agenda along to the trade talks with china here even commerce secretary wilbur ross dampened expectations here saying we're miles apart here. are we realistically expecting a deal by march? >> march 1st is important because that's when the current pause in tariffs expires on

march 1st. investors obviously care deeply here the question is what happens by march 1st. we have been saying for a long time and on this program saying we don't think a deal is possible by march 1st but doesn't concern us, we think in the right direction that negotiators would be willing to extend the pause and probably the best case scenario that the market could ask for right now >> either stop the clock or framework that they could hang stuff on later. >> that's, fingers crossed >> we will see what happens at that point stephanie miller, robert costa, thank you for joining us taetd today. >> speaking of schultz, he'll sit down to talk about his campaign you can see it tomorrow beginning at 6:00 a.m. on "squawk box. tracking all the action. hi, rick. >> a bit of curve steepening as the long end slipping a bit. the short end, excuse me, and the long end super solid we just had two auctions in the

two year and five year i gave it a "b." if we look at one week of fives, which would jump out at you. a bit choppy but firm and in a tight range. this is the very definition of a market that's really starting to coil tight this will be the 15 session that looks to close in the two 70s and if we look at the dollar index close to two weeks, what really should jump out at you is how 96 really slices the action and how below, even though mostly in a range, the biggest culprit, has been some deterioration and finally, everybody is pulling their hair out on the brexit. could it be a hard exit and new information coming out today but in the final analysis, the markets seem a whole lot more comfortable and investors, look at the october start, with the pound versus the dollar and same

true with pound versus euro. currency, solid. kelly, back to you >> thank you, rick rick santelli. exciting day for cnbc. we're announcing a partnership with the financial wellness company acorns the ceo to join us with the details and talk investing for the future when "power lunch" returns. ♪ (vo) here's a question. was it necessary to create a luxury car more teched out than silicon valley? with a cockpit fit for aspaceship. hang on. radar that senses things the human eye can't. busted. and the ability to make a thousand decisions before you even make one. was all this, really necessary? what do you think? ♪

sometimes, they just drop in. obvious. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group - how the world advances. ♪ at&t provides edge-to-edge intelligence, covering virtually every part of your finance business.

and so if someone tries to breach your firewall in london & you start to panic... don't. because your cto says we've got allies on the outside... ...& security algorithms on the inside... ...& that way you can focus on expanding into eastern europe... ...& that makes the branch managers happy & yes, that's the branch managers happy. at&t provides edge-to-edge intelligence. it can do so much for your business, the list goes on and on. that's the power of &. & when this happens you'll know how to quickly react...

welcome back check out the staggering statistics a quarter of americans say they have lost $30,000 in their lifetime due to a lack of financial knowledge. 29% of american households have less than a thousand dollars in savings. and over 100 million working age individuals do not own any retirement account assets. to help address some of these problems, cnbc announced this morning to partner with microinvesting app acorns on a new financial wellness initiative called invest in you. ready, set, grow there's a story on cnbc.com already today about that nbcuniversal and comcast ventures announced today they will make an equity investment in acorns and cnbc chairman mark hoffmann will sit on the board of the company so the partnership is going to focus on improving americans' money knowledge in the areas of saving, spending, and investing. and joining us today to discuss

the new partnership, the newest member of the nbcuniversal family the ceo of acorns. noah turner. >> thanks for having me. >> welcome to cnbc >> so you were a microinvesting app and robo adviser what do you call it? >> a financial wellness system but started by helping people by rounding out spare change and that automatically going into a portfolio. that's the beginning >> so they make a purchase with a credit card, debate cait card round up to the $3 to some sort of investment. >> and then add a recurring investment by the day, week, or month. and then automatically with a retirement account lots of different ways to automatically save and invest to make it easy to do that. >> what really strikes me, you've got $1.2 billion in asset under management right now. >> basically in spare change.

>> 2 million investment accounts it speaks to how small the small change adds up at this point. >> you think about it. so the average american, 70% of americans don't have $1000 emergency fund we're encouraging people to invest, save and invest small amounts and say, look, when you do this, it adds up over time and it really does you see the balance adding up and added confidence and sense of hope for the future >> so people pay a monthly fee, is it? to be part of this how does that work if every day, i've got 25 cents here and 75 cents there, usually, on a platform like a charles schwab or ameritrade, there's a commission fee how does it work on acorns >> so the reason we call it financial wellness, $1 a month, automated investing. full earning platform. we partner from nike to airbnb, to amazon and they invest when you shop as an acorns customer and also have a whole financial

literacy product which is one of the things we're building together so we educate you. we have all of these different things to go into the product. a dollar a month, actually quite good in value. and then there's tiers on top of that. >> not per transaction or anything like that >> it's a monthly subscription. >> everyone's copied it. bank of america. all of the big banks said, you know what, this is fabulous. we're going to do it for our customers too. so is this also looking for your next act to say, we started with a revolutionary brilliant concept but have to build into a subscription service to get those people to stick with us and provide them with a suite of services going forward >> the financial wellness, get into the all the different areas. acorns spend which is the first checking account with a debit card that saves and invests for you. all the different products with the purpose of helping you save and invest we don't just get into the business areas to get into them but helping americans. >> you have other big americans.

they created some of the etfs your customers can invest in payp paypal, they've set up a mechanism to allow some of the customers to invest in you what do we bring to the happen this -- in fact, we should point out that nbc universal is your largest shareholder. what will this partnership look like for our viewers >> if you go back in time, dwas is a core part of the product line and making it multimedia, the power of cnbc and cnbc's capabilities to our customers, to america's up and coming we think to elevate everything we're doing. >> the latest round of funding which nbc universal participated in valued your company now at $860 million how big can you become how big is this market that you're going after that other companies now are going after, especially in the robo adviser

community? >> we want 100 million americans investing every year we think that's necessary for the country to happen. >> is an ipo in the cards? >> i hope so. >> that's the goal eventually? >> i hope so. >> 100 million times 12, 1.2 -- how much annual revenue would that be reaching that goal >> i don't know off the top of my head but it would be nice nice. >> a big number. it starts at dollar a month and want to push people up, as well. for $2 a month - >> we were talking about that this morning you made an interesting point if you're saying to people give us $50 a month they're less likely to invest than saying $5 a day. >> right >> yeah. $150 month, less likely to participate than $5 a day. >> right. >> and actually it's four times more likely to participate at $5 a day. >> you tricked them into it then >> not a trick i think it's a healthy nudge to say how do you get people doing the right things the business model, subscription

and not just -- so - >> very good. >> thank you. >> noah, ceo of acorn with cnbc partnership and welcome you to the nbc universal family. >> how many people in right now? >> 270. >> 270 people? employees. how many people used it? >> 4.5 million accounts. >> 250 yeah >> get used to it. this is the kind of talk we have around here. >> thank you. >> thank you for having me appreciate it. apple earnings, everything you need to know to come up and waiting for a white house press briefing expected at the tom of the hour stay with us on "power lunch."

shares of apple rebounding seance sharp drop this year after the revenue warning and getting back almost all that ground can it bring it back all the way? hey, josh. >> apple's going to report results tomorrow in a very different way. the company no longer going to disclose the number of iphones it sells tim cook saying this metric is simply no longer relevant and investors to concentrate on the company's total revenue power. >> i have made the comparison it is like you and i going to the grocery store and putting things in our cart and coming up to the register and saying how many you

got? it doesn't make sense to add them together anymore because the price ranges are so wide >> another change, apple will now break out gross margins for the services business. loop ventures estimates margins of 65%, higher than the overall company and then china, cook talked about a weakening economy and analysts wonder if consumers are more interested in options from local brands. they're looking for insight when apple reports after the bell back to you. >> josh, thank you we look rwd tt foartoha tomorrow

so on twitter the new york stock exchange made a humble request -- that the world refer to it as the nyse, not the "nicey." they're really, really, really, really - >> times 19. times 19 the first person i thought of was miss kelly evans. >> oh! >> i think directly corresponds to the times she said nice-y since joining cnbc. >> it's quicker. >> the years we worked together on "closing bell" that bugged me when you would say that. >> let it all out. >> and they want nyse. i will say - >> cbo and - >> a good nickname should be one or two syllables. >> nice-y.

two! >> nyse. yeah. >> takes too long. >> what about cnbc >> that's why you have to say it out. that's no good shorthand. >> all right well off the session lows. >> sticking to my guns. >> thanks for watching "power lunch. "closing bell" starts right now. ♪ and live from the nyse -- welcome to "closing bell." i'm sara eisen. >> i think got my habit of nice-y from kelly evans and that's the first time i was corrected. >> they don't like it. >> i'll change from now on and i can't really apologize for the past until today i'll change. from new york stock exchange, i'm wilfred frost. former starbucks ceo mulling a run for president in 2020 we'll talk to walter i sacso