this last night on "fast money" and she said sources are showing high growth disruptive retail and consumer companies are the comparables. fresh pet, canada goose and shake shack. think about the consumer bands that are really disruptive beyond meat might fit that >> there are going to be so many more companies like this >> thanks for watching "power. >> "closing bell" starts right now. >> it does indeed. it's the final hour of trade i'm wilfred frost. >> and i'm sara eisen. the federal reserve's message to the market former fed governor daniel terullo will join to us discuss what next steps the fed should take >> fake meat real returns we'll tell you what's behind beyond meat's wild first day of trading. >> and after the bell breaking earnings news from cbs, activision, expedia, and more. we'll tell you the key numbers to watch in each of those reports. "closing bell" starts right now. >> welcome to "the closing

bell." let's check in on the markets with just under an hour left of trade. we are off the lows, which for the dow is down 250 points we're currently down 162 but still declines for the three main indices the dow down 0.6 the s&p down 0.4 and the nasdaq down 0.3% real estate, financials, health care the only positive sectors energy very much bringing up the rear with oil prices slipping over 3%. >> let's get right to it with our "closing bell" exchange. joining us today is sam stovall from cfa drew mattis from metlife and our own rick santelli at the cme group in chicago gentlemen, as always, hello to all of you is this just an opportunity to lock in profits after a record run or is there really a tantrum going on about the fed still >> i think there's a combination. i think what has triggered the likely digestion of the gains we've seen, remember this is the third best year to date performance since the end of april we've seen since world war ii and usually in that sell in may

period the market declined about 3% and has fallen about 80% of the time >> rick, despite a declining market, financials holding on to slight gains today we've seen a nice little steepening of the curve. >> yes, we have. you know, the curve did steepen but it's come back to that 20 level. but i still think what you're saying is very important we have a parallel shift today after we got recalibrated after the drop in rates where two-year's dropped to 2.20 and the 10-year's dropped to 2.45. here's what's interesting. when you look at the interest rate complex on coupon curve, then you look at the euro-dollar futures, of course the short that's the point we should focus on i'm not saying the markets are going to be right. i think it's very difficult for the markets to take real-time data and try to formulate it in a package of what the world's going to be like two or three meetings down the road

but the fact it's happening at all really accentuates why the markets are moving the way they are. the fed didn't say there's a cut in the offing. we see interest rates firming up a bit. i think that explains the financials and for the technicians remember we're less than half a cent away from a 23-month high retest for the dollar index, right under 98 and a quarter, and maybe the other most interesting feature of all is that we are seeing volatility move in treasuries. people are thinking maybe there's going to be a rate move to the up side the barrier to that good resistance around that 2.60 level in 10s >> how do you interpret the market reaction to the fed now in its second day? >> they never should have been pricing in a cut, first of all and i think the productivity numbers tell you everything you need to know productivity's secure for everything that ails the world if you get higher productivity you can pay your workers more. doesn't generate inflation potential growth in the economy

goes up. and you typically don't get accelerating productivity late in the economic cycle. so it tells you where you are in the cycle as well and it tells you we're a lot further away from a recession than people should be expecting. >> you see the pickup in productivity as extremely bullish for the economy. is that what you're saying >> it's a very good sign for the economy. it's a very good sign for the fed. it means they can take their time raising rates but the next move is up, not down >> in terms of the strong start we've seen to the year, what do you expect to happen after that when you look back at history? >> usually the may through october period is pretty challenging. ends up being flat to down but then the november-december period is actually typically very strong. 90% of the top 10 starts to the ended up having positive november and december. what that would imply is as drew had mentioned, that if you're bullish going longer term you would take advantage of the dip we're likely to see. >> does seasonality still work as a strategy these days

>> absolutely. you basically find you are better off rotating than you are retreating there is a season of rotation etf out there. szne that investors might want to take a look at. but basically it says gravitate defensively may through october and cyclically november through april. >> you're bullish but what would be your biggest fear that would mean that view is wrong? >> let's look on the xwribright side what is it f. the china trade talks gets resolved? what gives you more up side globally if china trade talks get resolved it will do well, it will pull germany with it and we're talking about the globe moving forward together and that would be a big positive for the u.s. economy >> what do you expect on jobs tomorrow >> i expect it will be a good number and i expect the next month's will be a good number as well we're not seeing layoffs if people aren't getting laid

off they're not going to save money they're going to spend it. >> what has more potential to move the market? is it the headlines? wages? and which way should we look out for? >> it's probably the earnings numbers because people will say if wages go up too much the fed's going to hike earlier than they're expecting. that's why the productivity number's so important. it means wages can go up and the fed can still just sit on their hands. >> we'll see if it means inflation is transient or not. sam and drew and rick, thank you all. very much for joining us >> we've got a news alert right now on foxconn >> the white house is now officially confirming that the president met with the ceo of foxconn here at the white house yesterday. there have been media reports to that effect. foxconn had put out a statement of its own but the white house hadn't said anything about it until just now here's the statement and watch for the political nuance in this statement we'll talk about it after i read it the statement from sarah sanders saying, "yesterday afternoon president trump met with brilliant business leader terry gou, creator of foxconn, one of the world's largest companies. mr. gou is spending a lot of money in wisconsin

we'll soon announce even more investment there the president and mr. gou did not discuss support for his campaign in taiwan he is just a great friend. now, remember, terry gou is running for president in taiwan as a china-friendly presidential candidate there. and obviously there are sensitivities around an american president meeting with any potential taiwanese presidential candidate since the united states broke off relations with taiwan back in 1979. all of that having to do with the relationship with china. but the white house here insisting that a, this was just a friendly meeting between two business guys who are now in politics and b, that terry gou is going to be soon spending a lot more money in wisconsin that obviously has political implications here in the united states as well, sara >> eamon, thank you very much for that eamon javers in washington let's drill down on a rare winner in today's session. beyond meat surging in its first day of trade frank holland is at the market

site with the details. >> investors clearly have an appetite for this plant-based meat alternative company beyond meat the best performer in the nasdaq today. shares surging about 170% since this ipo launched just about three hours ago. beyond meat's also one of the most heavily traded stocks in the nasdaq just about 20 million shares changing hands so far. beyond is best known for its burgers but it also offers a sausage alternative and has plans to roll out even more products later on this year. you can find beyond meat in about 17,000 retail locations across the country like whole foods and target it's also served in restaurants like tgi friday's. it's pretty easy to find but the tough question for investors, can beyond become profitable strong start to this year in q1 sales tripled. in 2018 sales grew by 170% but in 2018 and 2017 the company lost just about $30 million. so i spoke to the ceo and the founder, ethan brown, and i just asked him, do you see a time horizon when you see this

company making money he said he's not read yy to anse that yet right now his focus he says is on scaling up, improving capacity, and also of course just enjoying this monster ipo day. again, beyond meat, the best performer on the nasdaq today. shares up about 170% since the ipo launched about three hours ago. >> crazy debut wu-tang told us vegetarianism is the real thing >> i think he's more of a fan of impossible >> he wasn't talking about beyond meat. just the trend thanks, rza. under armour beating the street on both the top and bottom lines. shares up about 30% so far this year time to take profits on this stock or not let's bring in -- was it a good quarter or someone it's hard to tell >> if you're looking for a

short-term stock move underroom our has given them credit on growing expectations stocks do well you when you beat those expectations longer term i think it's worth less than it is today. >> we were talking moments ago about is it kevin plank, is it the ceo? >> it's a great brand. there's month question from a stock perspective controlling the narrative and making sure that investors are going to be pleasantly surprised is very important. that allows the multiple, or the current multiple to be a little bit overlooked so they've done a really good job at creating a recipe of beating now and still outlining a long-term path i think the point we would make for that long-term path is paint the blue sky i think they're going to get great margin expansion at the end of the day if it's worth less when it hits that day that's important >> they aren growing overseas quite nicely

that's really where the growth came on the top line that's a good story. the margin improvement's a good story. they managed inventory very well it came down 24% from last year. and they got some hits like the hover right now. what don't you like? >> by the way, the footwear was a positive surprise. i think we've been looking at -- it's be just apparel this time ultimately when you talk about big companies, big companies need to moffett needle on the biggest part of their business, not just on the parts that are on the outskirts >> north america >> north america did not grow. and when you think about nike, we always talk about nike as a footwear direct business domestically, the dtc business hasn't grown yet there's nuance in terms of shifts they're talking about but at the end of the day north america and dtc their own stores you have to see when does the real growth kick in? >> they're staying more focused on the pure sportswear than some other rival brands is that the right strategy to keep the brand image as pure >> it's a great point because i think the word that came a lot

and i don't know how to pronounce, it premiumization, or something. a lot of vowels. >> premium performance >> make it longer, it sounds better at the end of the day what it means is selling fewer things at higher prices. fewer things at higher prices does not translate to meaningfully higher revenue growth when your margins are down here you can bet them up here but when ruhr talkyou're talking about nike and adidas as your comp, it's a different idea of how to get to that level that level is not making it incredibly premium >> casper warstead tomorrow, ceo of adidas. they're reporting earnings tomorrow who's winning north america? >> nike in a menningful way. and lulu who's doing a good job. >> do you think lulu's cutting into adidas and under arm snowshower. >> lulu is growing beautifully that's to be expected. they're a smaller company. >> simeon siegel after the break tesla outlining a plan to raise billions in new capital. we'll ask an analyst whether a cash influx can help solve some of wall street's most pressing

concerns later an exclusive interview with former fed governor daniel tarullo. we'll get his reaction to d nserthawg omwidrinfr fecoidation today. to a single defining moment... ...when a plan stops being a plan and gets set into motion. today's merrill can help you get there

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welcome back to "the closing bell." down 145 points on the dow tesla announcing plans today to raise $2 billion in capital from investors and ceo elon musk is among those interested in the new offering according to a filing, musk plans to buy around $10 million worth of the 2.7 million shares in the offering. could this help tesla bounce back from a rough year joining us joseph osha from jmp securities joe, thanks for joining us what's your take on what is essentially a u-turn for musk as to whether they're going to raise capital or not >> i had never really understood

why musk was so determined to tell the street he wasn't going o'raise capital. he's got $40 billion in market cap and why not put some money in the balance sheet it's interesting most companies when they announce they're raising 5% of their market value the stock would go down. stock went up today in a weak market so i think that tells you how reassured investors are by what they've done >> i feel like the whole capital raising and capital concerns has really come down on the list of top worries for investors. number one being demand that was never really there before. how much does it go toward alleviating some of the bigger worries around tesla right now >> this is the great mystery for me if you look at this company's second quarter, the june quarter target that they put out, 90,000 to 100,000 units, the last time i was on this show, if i had put that number out there people would have said i was being very, very optimistic. the same with reiterating the full-year target, which is 360

to 400 thousand. i actually don't quite get where this demand weakness thesis is coming from. q1 was weak but they very clearly are recovering so i'm a little confused by that narrative to be honest >> so if you did see another quarter of disappointing numbers and demand, would that lead you to drastically change your forecast >> yeah, it would. to be fair, i think it wasn't that hard to figure out q1 we had cut our numbers before they announced and i think they were pleat forthright about it. if they miss this q2 number they put out there that's a different story. but they've got a pretty good beat on it, remember i don't think they would have put that target out for q2 if they weren't pretty confident they could hit it. >> the demand concerns revolve around the model 3, right? which tesla has staked a lot on including its future and has had to go through a number of price changes and it hasn't been as speedy of a rollout as expected. >> i think what happens is --

and we talked about this before. q4 was not as good as it appeared to be q1 was not as bad as it appeared to be. there were some changes in the subsidy regime that caused some strangeness. and so i think what we're seeing in the second and third quarter and beyond is demand normalizing a bit. i don't even have model 3 demand at the end of this year getting back to where it was in the fourth quarter of last year. i think we've kind of been over a hill and a valley and now we're resuming a more normal trajectory i would say >> thank you for joining us. joseph osha. >> you're welcome. thank you. >> we've got 40 minutes to go before the closing bell. take a look at the major averages 154-point sell-off in the dow. s&p continues to pull back from near record levels nothing dramatic down a third of 1% same for the nasdaq. russell 2000 continues to play catch-up still 10% or so off its record highs. it is the outperformer still ahead more than 360 s&p 500 companies have already reported earnings.

there are still plenty of big names waiting in the wings we will count you down to reports from cbs, expedia, activision, and more this afternoon. >> plus our own kate rogers has an exclusive look at the facility where starbucks dreams up its specialty drinks. kate >> hey, wilf that's right beverage innovation has really been important to the brand especially its cold beverages and those innovations continue to see a lot of success. we're going to take you behind the scenes here and tell you all about that coming up after the break "osg ll measure up? a cfa charterholder does. you've worked hard to grow your wealth. make sure you're working with a wealth manager who can grow with you. cfa charterholders have the investment expertise

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here are the losers in the dow. core earnings 24% earlier than a year earlier, hurt by lower prices even though slightly better than expected revenue than forecast nonetheless down 6%. caterpillar, walt disney, and united tech making up the other losers on the dow, which is currently down 146 points. >> some of starbucks' more outrageous drink creations such as the unicorn and crystal ball frappuccinos have been known to boost sales and the stock for what could be next our kate rogers is at the coffee giant's innovation center in seattle. a lot of interest in this, kate. >> hey, sara that's right this is called the dreyer center it's a 20,000-square-foot innovation hub basically where they're testing out all different kinds of things including those beverage innovations you mentioned. this is the cold pop store where

they're working on new beverages. they're innovating around new beverages because it's one of the company's strategic priorities for growth. cold beverages in particular tend to sell really well executives say no matter what time of year the most viral drink the company's-h the unicorn frappuccino that drove a lot of brand awareness and sold out really quickly in stores second most viral is recent. the cloud macchiato drink. it rolled out with ariana grande this past quarter. from launch to date the stock is up around 8% we got o'talk to ceo kevin johnson and asked him what those viral moments mean for the stock. >> i think those moments help spread the word of something interesting and fun that we're doing in our stores and that brings more customers in and bringing more customers in allows us to create the starbucks experience and connect with those customers and at the end of the day that's what drives our business and it's really the financial results that we've been posting that drives the stock price. but those financial results are driven by customer connections in our stores.

>> other drinks that they've now rolled out for the spring include the s'mores frappuccino, the dragon fruit drink is also very popular we should note the company's coming off another very strong quarter, particularly in the u.s., all led by that beverage innovation they had another 4% comp in the americas that's the third quarter in a row now. we should note that the stock just yesterday hit another 52-week high, guys back over to you >> and kate, these types of drinks, do they also help starbucks try and maintain its premium brand image? these drinks are fairly expensive, aren't they, relative to just a normal cup of coffee >> that's right. they can certainly drive ticket because they do tend to be a little bit pricier it all kind of depends on what you're going for but certainly like i mentioned earlier those cold drinks in particular we've heard from ceo kevin johnson and c.o.o. roz brewer saying they sell really well no matter what time of year they called that out last quarter even in the winter, guys which is interesting >> i think there's a distinction between viral drinks that starbucks makes that are good

for instagram and those that are actually tasting good. for instance, the s'mores frappuccino's delicious. the unicorn one i think just looks really good. >> but didn't they sate unicorn one sold out it must have done well >> it's an instagram world, right, kate? >> it's totally an instagram world. we're all just living in, it guys wilf did mentioned it sold out pretty quickly it was really popular. i didn't get o'specifically taste that one these are fan favorite type things they get people talking, obviously drive traffic to stores we see it moving the needle on comps. and that leads to stock performance doing well >> kate, thanks very much. >> try to break the next one >> for your waistline. i can't believe it's -- >> you don't get it for me when you offer me a coffee. >> you can order whatever you want nice to get an offer reciprocated once in a while cbs due out with earnings after

the bell there's one crucial thing wall street will be watching. we'll tell you ahead jay powell allaying out his inflation outlook during yesterday's fed news conference. >> we suspect that some transitory factors may be at work thus our baseline view remains that with a strong job market and continued growth inflation will return to 2% over time. >> had a big market effect after the break we're going to talk to former fed governor daniel tarullo about whether ghmo t f a me e akth rit ves.

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welcome back to "closing bell." down market. pockets of strength. real estate, health care and financials are all higher today. energy materials and communication services are the biggest losers >> it's time for a cnbc news update with sue herera hi, sue. >> hello, wilf hello, everybody here's what's happening at this hour top white house attorney emmett flood slamming special counsel robert mueller's approach to the

obstruction investigation. this according to a letter sent to attorney general william barr last month the letter, which was released today, says, "either ask the grand jury for an indictment or decline to charge the case." a venezuelan court issuing an arrest warrant for opposition politician leopoldo lopez. lopez is a known political ally to opposition party leader juan guaido and is currently seeking refuge in caracas. google telling a u.s. house panel that it spends hundreds of millions of dollars annually on content review the company also saying it manually reviewed more than 1 million suspected terrorist videos on youtube in the first three months of 2019 and a strong gust of wind catapulted an inflated bounce house 20 feet in the air during a washington state high school event, injuring five students. the bounce house traveled a distance of more than 240 feet according to local reporters they've had a lot of bad weather

out in that part of the country. all right. you are up to date that's the news update, guys i will send it back to you see you next hour. >> that's another different name compared to -- bouncy castle we call them. >> yes, exactly. bouncy house and bouncy castle i like bouncy castle better. you got it federal reserve chair jay powell downplaying any weakness in u.s. inflation numbers yesterday after leaving rates unchanged. one word in particular to describe that lower inflation number >> we suspect that some transitory factors may be at work the persistence carries the sense of something that's not transient. we do see good reasons to think that some or all of the unexpected decrease may wind up bei ing transient. >> some of it does appear to be transient or idiosyncratic >> we do expect this reading will be transient and inflaim flation will move back you. >> there's good reason to think

this is influenced by some transitory factors >> there's reason to think these will be transient. >> we're going to be watching inflation carefully to see that these things are transient >> transient is the new patient. >> i thought it was transitory more >> well, he alternates >> what was loo, like 7-2? >> we counted. he described inflation as being transient or transitory nine times. let's bring in daniel tarullo, former governor on the federal reserve. the market didn't like the word transient. how do you feel about that >> well, i think they might have been taken a little bit by surprise, particularly in light of both the prefomc statements from a number of members and also the statement itself, which had suggested a bit more concern with inflation obviously the use of the term by the chair repeatedly raises lee questions. the first is is the lower inflation reading transitory

surely some of the factors are but over the last seven or eight years there have been a lot of factors cited to explain the lower inflation and most of those go away and then some others take their place. second, what is it going to take for the fed to determine that it is not transitory and they need to do something about it you know, if you put a lot of weight on inflation expectations, those are already creeping down a bit. if you put more weight on actual inflation figures in the last seven or eight years we've been above 2% only a relatively few number of quarters and below more. that's a bit of an issue for the markets as well. and then finally, and maybe most importantly, how does this all fit in with the framework review that the fed is doing of monetary policy generally? that is, how important is it to get up to that symmetric target of 2% and sometimes over it? and i suspect that markets and analysts will be asking that

question as well >> to that point, even if inflation below 2% became persistent rather than transient, does that matter so much when the other readings on the economy are looking pretty good and even improving? >> yeah, i think it does, wilf, and i'll tell you why. i mean, right now -- remember, in a recession, significant recession, not the great recession, but my significant recession in the post-world war ii period, the fed has generally reduced the federal funds rate by somewhere between 350 and 600 basis points right now with federal funds rate at what, 237, between 2.25 and 2.5, they don't have that much room. and with the neutral real rate of interest back to be a good bit lower than it used to be, there's not going to be that much room. so if inflation is below target there's going to be even less room for the fed to respond with

stimulus in the case of a downturn so i do think this is an important issue and it's also an important question for the fed after a decade of below-target performance, which is somewhat understandable in light of the great recession. how important is it now to get back to the fluctuation around 2 rather than always just approaching and then dipping back down again? >> is that only really totally crucial if we start to see a recession again? kind of use europe as an example where you might be seeing the data turn hameaningfully south t rates already toward the lower bound. >> you could obviously worry about liquidity trap issues and the like i don't think those are the immediate concern. personally, i have been more concerned with the fed's toolbox for responding to a recession

for some time now. and i think you've heard from a number of fed -- current fed members over the past couple of years that they are too. and that really is an important issue for them ties into inflation although it doesn't define the issue entirely >> daniel, when it comes to tools for a recession, if we were to go into one, what would we see >> i don't know, sara. i mean, that's -- that is the good question. presumably -- the fed appears not to be inclined to negative interest rates qe would be of only modest use one suspects the use of some of the communications ideas that have been talked about may have some impact but it's not clear what the toolbox would consist of if we

were in a full-pour recession as opposed to a mild dip. and as i said, that's a very important question by the way, not just for the fed but for the treasury department and for the congress as well what their response would be in the event of a recession >> yeah. and for europe and for japan as well, who are already all in i wanted to ask you about some events that transpired today stephen moore withdrawing his consideration to be a fed governor like you were from president trump. are you relieved or do you think he would have brought some fresh insight into the committee >> well, you know, that appears now to be a closed case. and so just let me say, sara, i think for the senate and thinking about nominees to the fed, here's the way i would think about it first, it is important to get a diversity of intellectual views

representing different perspectives i think it's quite important not to foster a kind of groupthink internally and i think the current fomc has some diversity of views. but for any individual candidate then the question is not have they got heterodox views i think the question is first are they in a position to contribute to the discussions at the fomc in a positive, constructive fashion second, as i think you saw senator ernst asking, the qualities of the individual and their own views on other things such as to make the senate uncomfortable. and then third, it is important that everybody have confidence that whether you're a hawk or a dove or have a heterodox view that the way in which you apply your policy doesn't matter depending on what the identity of the -- who the president is, democrat or republican

i had a number of colleagues on the fomc who were i thought sort of pretty hawkishly inclined i never for a moment thought it made a difference to them whether the person in the white house had an r or a d after their name i think they were going to do what they believed in. and that's the important question for the senate to ask >> i wanted to ask about bank regulation how do you feel about the way it has been eased relatively slightly only since you stepped down has it gone too far or is it about right? >> i'd distinguish between the smaller banks, and by that i even include the smaller regionals of 70, 80, 100, 120 billion dollars on the one hand and the largest banks, the super regionals and the systemically important institutions that is i think the core of the post-crisis effort to assure resiliency in the financial system and so while i might have done

some things differently from the way senator claypo and his colleagues did in their bill, it was almost entirely focused on those small institutions i am a bit concerned about the direction with the large institutions the idea of wanting to relax the stress test perhaps and to make it easier for the super regionals to meet their liquidity targets. it's directional right now as opposed to the changes that have actually been made but we did have a consensus on the need for higher capital, better regulation of the biggest institutions, and i think it's important to maintain that focus. and you know, it's fine to try things with the smaller banks and not to hamstring them with more regulatory burdens. >> dan, what about mergers like bb & t and suntrust? more of the ame, is that okay? >> i don't want to comment on

that one specifically. but i would say sort of as an analytic matter, wilf, i think the interesting question for the fed year is does that merger in their view increase risks to financial stability, leave them essentially unaffected, or you could make an argument for the proposition that maybe even at the margin it helps by having more large institutions. personally i don't have a view right now, and i'd be interested in seeing people's analysis of it but i think the fed needs to be quite explicit in addressing that question when they make an eventual determination because that's going to tell everybody what their tolerance and appetite is for permitting more consolidation at the top of the industry in what is after all already a very consolidated industry at the top, not at the bottom. >> all right

good to have you come back soon you can talk whenever you want daniel tarullo weaker sales and a shake-up has shares of kellogg dropping today. we've got the details next plus we're counting you down to a slew of earnings after the bell as we head to break, here's a check on how those companies are trading into the close, which is 18 minutes away.

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internet that puts alright boys, time to eat. that handles anything. [ crowd cheering ] that protects what's important. and reaches everywhere. this is beyond wifi. this is xfi. there's a one-month chart for blackstone they were up 4% or 5% that day more importantly let's have a

look at kkr who did this last summer they announced it in march 2018. it took place in july 2018 you can see shares rose over that summer. does that gain hold? kkr said their mutual and indetection fund ownership did rise by 64% but their hedge fund and brokered dealer ownership. the move by less than 1% suggests perhaps the benefits aren't as big and long lasting as some might have hoped sara, what's your stock ruler? kellogg down a little more than 3% today the company reporting earnings very disappointing weaker profit in north america a surprise cfo change didn't get much encouragement to investors. also lowering expectations for the year bottom line, not much to get excited about in this food company. not much growth. really lower volumes, any growth at all due to pricing.

millennials just don't want rice krispies and frosted makes cereal sales continue to decline. it's been a theme at the big food companies, especially those that are exposed domestically. here in the u.s. and those exposed to packaged foods like cereals and also frozen foods. up next on "closing bell" our reporters will tell you the key numbers to watch from cbs, expedia and activision those earnings coming up at the top of the hour. "closing bell" will be right back we've done it! hah!

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welcome back to "the closing bell". lower by half a percent. the low of the session was 250 points as we said, nine minutes left of trade. >> more than halfway through earnings season. 360 s&p 500 companies reporting so far the numbers have been largely ahead of estimates 75% of those companies have beaten on earnings per share just 18% missing and 7% matching overall eps growth tracking for a rise of .7%, which is a 2% expected decline revenue growth pacing for 5.2%

gain >> after the bell we'll get earnings results from cbs, expedia, activision blizzard and a couple of others let's dive into the key metrics to watch in those three. julia poor stin. seema mody has activision. jul julia, let's start with you. first streaming, how fast are consumers subscribing to its cbs all access and showtime app? and what will the company say about coming competition from a slew of new streaming services second, scale. can cbs continue to grow its ad revenue in the face of consolidation with consolidated, competition with consolidated jiejts like disney and at&t? we'll be listening for any hunts about a potential merger between cbs and viacom also looking for the company to report 14% revenue growth on about 1 1/2% increase -- percentage increase in earnings per share. sara, back to you. >> julia, thank you. let's go to seema mody for a preview of expedia

>> the focus will be on home away, expedia's home rental service after earnings showed growth in home away slowed analysts say competition from airbnb and new players like marriott mean competition could become more challenging going forward. on the call analysts will also be looking on commentary on the macro environment after the ceo last quarter referenced a drop-off in uk flight bookings due to the uncertainty around brex ilt shares of ex-feedia up 14% this year outpacing its peers wilf >> seema, thanks very much for that meantime, josh has activision pour us. josh >> here is what the street expects when it comes to activision blizzard. earnings per share of 25 cents on revenue the street thinks of $1.24 billion. that stock up about 6% this year down some 40% from its recent high piper's mike olsen says that is due in part to concern about a relatively thin pipeline of new games this year.

also we'll zero in on revenue from the king segment, its mobile segment where he's expecting 535 million. that will represent about 45% of revenue in the quarter wilf >> okay, josh, thanks very much. up next we'll have the closing countdown. about six minutes left to trade. >> after the break, in addition to those earnings, gilead, shake shack and first solar. breaking those numbers as soon as they come for you we'll be back on "closing bell." dow's down 142 medicare is great, but it doesn't cover everything - only about 80% of your part b medicare costs, which means you may have to pay for the rest. that's where medicare supplement insurance comes in: to help pay for some of what medicare doesn't. learn how an aarp medicare supplement insurance plan, insured by united healthcare insurance company might be the right choice for you. a free decision guide is a great place to start. call today to request yours. so what makes an aarp medicare supplement plan unique?

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a little over three minutes left of trade. let's turn to the nasdaq frank holland with the biggest movers there frank. >> good afternoon, sara. beyond meat the best performer in the overall nasdaq. today shares up about 160% since it launched its ipo just about three hours ago. still off the highs of the day however, tesla the best performer on the nasdaq 100 after the electric car company announced it's going o'raise $2 billion from investors and elon musk himself will buy $10 million worth of new stock also a strong day for chips. 25 of the 30 stocks in the sox etf up today but despite all that strength in tech the nasdaq is still on pace to break a five-week winning streak and having its worst two-day stretch since march. all the fang names in the red. microsoft the worst performer in the ndx that's despite reaching a $1 trillion market cap perhaps some profit taking after the run-up wilf, over to you.

>> frank, thanks very much let's look at the s&p, down 0.3% the dow down 144 points, or half of 1%. the russell slightly higher. the low of the session for the dow is 250 s&p intraday chart four you can see gains from the first hour of strayed quite a big sell-off in midmorning and steady improvement throughout the end we're definitely ending off the lows of the day. quick look at oil prices, down sharply. largely because of that 19-month high that we saw in u.s. crude stockpiles yesterday down 3.7% earlier on oil currently we're down 3.2%. ten-year treasury. it's been quite a volatile week in terms of that yield more decisive move higher in terms of the long end of the cut today as you can see on the ten-year up to 2.55%. the shorter end didn't move as much that's helped the banks. if we look at sectors you'll see the financials just holding on to gains otherwise defensive tone to the sectors like real estate at the bottom because of the oil price is energy.

bob, what are you looking at >> that's a good point it's been a while since we've moved in conjunction with the oil markets. it's been about a year or so but this is happening again. it happened today. in fact, we moved sort of in lock-step with oil we bottomed when oil bottomed. there's an intraday cart of the oil markets. you can see the market kind of came off its lows when oil started to bottom out. this relationship doesn't last for long periods of time but we've seen some of these energy stocks after coming off the lows in january and february moving to the down side rather notably. look at these, apache, marathon, 4%, 5%, 6% declines. we've seen declines in material names. the steel names have had a tough time freeport mcmoran a tough time. we've seen some other stocks that have been a little on the weak side as well stayed gold names gold sitting near the lows for the year that's another issue sow see some of these names like -- a little hissy fit around the fed they're not getting it from the fed. and of course we want a trade deal and we want china data to

definitely improve we want better numbers that's why we're hitting this kind of resistance >> a little bit of a pickup in the vix. >> 14. not that much right now. i don't think we're -- >> bob pisani, thank you very much there goes the bell. we're down 130 points on the dow. half of 1% the s&p down just a quarter of a percent. russell the outperformer up 0.4%. that does it for the half of "the closing bell. sara, back to you. >> welcome to "closing bell. i'm sara eisen wilfred frost rejoining me in just a moment along with mike santoli, cnbc srng markets commentator. take a look at how we finished up the day on wall street. mini sell-off on wall street certainly recovered from the worst levels of the session. still down mostly across the board. the dow going out with a loss of about 120 points dow chemical was the biggest loser on the dow home depot the winner on the day. s&p 500 down .2 of 1%.

really recovering nicely from that bigger decline earlier. real estate, health care and financials higher. energy, materials and communication services lower that was the theme today we got about a 3% decline in the price of oil so that could be a reason for some of the weakness in the overall market russell 2000 index of small caps continues to recover better than the rest of the index. it still is not near record highs. like some of the other major averages, though it's up about .4 of 1% today we've got another big day of earnings for you investors awaiting results from cbs, expedia, activision, blizzard and shake shack full team coverage of all those reports. we'll bring you the numbers as soon as we get them. joining us to talk about the market today is stephanie link, global equities research director and portfolio manager at nuveen atiaa company. what stood out to you, mike? >> i think they're kind of methodical the way the market just found its footing it was nokds off balance in the late morning. it seemed like there was just

kind of a little bit of a slippage in the usual sector rotation we see that keeps the market supported with oil going down microsoft more than 1% a natural profit-taking move you've got the trillion-dollar market cap curse that's still in effect, by the way nobody's crossed over it and stayed over it so we -- i think that was enough to sort of say market back on the defensive. the s&p 500 the low for the day, smack at 2900. it seemed like a very mechanical pullback from the highs. it was a very tentative breakout so beyond that i don't think it was a breakout, 9 the market sniffing out anything new economically or with the fed just as much as it was deferred profit-taking, taking the form of a little bit of a wobble. >> stephanie, a little bit of a fed hangover today >> i think so for sure the big question is what's going on with inflation. and we heard transient seven times yesterday. >> nine if you count transitory. >> transitory, transient >> 7-2 >> i wasn't ever expecting a rate cut to begin with not with 3.2% gdp growth

not with consumption growth of .9%. remember back m december we were all obsessing how negative the consumption growth number was. we had a nice snapback in consumption. i know everyone's nervous about the ism. it's still expansionary. it's a little bit of fed hangover today but it's also earnings this week i'd give it a c. versus last week i give it an a. i think we're trying to digest exactly where earnings growth comes in it's not going to be negative. that's for sure. but i don't think it's going to be maybe the 3%, 4% we were excited about last week. >> earnings we're at that stage of earnings season where the bulk of the value of the index is in. the big movers have already been heard from for the most part i think it's company by company, it's very important. but for the overall markets it's kind of like we got, this we pretty much know where we're headed >> we keep getting these trade headlines sort of coming through. there's progress, they're working toward a deal. is the market immune to that now, stephanie >> monno, i don't think they're immune to it at all. we're just waiting it's hard to trade around it

especially if you're a long-term investor the data changes every single minute of the day. i kind of am ignoring it i am very optimistic about it. we have no idea how to play it in terms of the details. so i think we have to wait but i think that is still something that could positively surprise several industries because several companies within especially industrials and energy and materials and financials they've been hit because of trade so i think that earnings could actually reverse to the up side if we get a good deal. >> we've got gilead numbers just scum coming out. meg tirrell. >> beat on the bottom line, miss at the top $1.76. adjusted earnings per share basis. versus an estimate of $1.61. revenues coming in at 5.28 billion versus the estimate of 5.3 billion. slightly light there hiv drugs are the story for gilead their new drug victarvi looks like a beat coming in at $700 million in the quarter versus an estimate of 682 million. however, overall hiv sales did look a little bit light there.

it's going to be interesting to watch the stock, up about 1% now. on the call. it's going to be the first time we hear from new ceo dan o'day so we'll be listening tore any changes in strategy. sara, back over to you >> all right, meg. thank you very much. with the stock pretty much flat over the last 12 months. >> definitely at the low end of its long-term range. i don't know what you think about it, steph, but it's valued almost like it's a runoff business very mature, cash cow. that type dynamics >> this has been a value trap. i own it so i can tell you that but i think the story changes now. i think you have a new ceo you have a new cfo you have a ceo that has a great balance sheet that could actually deploy that and do more m&a. and i think you're going to see that into next year. maybe second half this year into next year. and the stock is very attractive very cheep for good reason because they haven't delivered but i think as they deploy that capital the stock should begin to work p. >> back to the broader markets, you mentioned the 2900 level on the s&p as a biftd a support in terms of the other way how

far are we now from the highs and what significance is -- >> intraday high was 2950. we're less than 2% away from that i think we close in the 2940s once or twice. it's obviously just really -- it's noise right around the highs. i just think that we came into may at this moment when you're up 17%, you haven't had an appreciable pullback of at least 3% all year. and so it feels as if the market got stretched a little bit and that breakout to a new high at least right now looks a little tentative and low energy but that could change very quickly. >> stephanie, do you wait until we have seen a 3% pullback from the all-time high on the s&p or are you very content to continue to see some up side momentum >> you know what's interesting, i have some stocks that are down 6%, 7% on earnings and if i feel comfortable in some of them, mainly the material stocks, they've actually disappointed, i'm actually picking at those. where i think the fundamentals for the long term are good i don't want to wait for a market overall to correct kind

of thing i'm just kind of picking my stocks, picking individual companies where i think for the long term they make sense sxwlp we've got cbs numbers out. julia boorstin has them for us >> cbs earnings beating on the bottom line by a penny the company reported earnings of $1.37 per share. that's compared to $1.36 estimated. now, revenues for the company coming in lighter than projected. revenues of 4.17 billion that's lower happen the 4.3 billion that analysts had estimated but up from the 3.76 billion in the year-ago period to break down what's driving the growth here, advertising revenue grow 18% thanks to the super bowl affiliate subscription fees rose by 13% but it seems like the shortfall here in revenue is due to the fact ha content licensing and distribution revenues decreased by 3%. we're not getting any specific numbers in terms of the subscribers to the streaming services, but the company says direct to consumer subs grew 71% from last year and they're

seeing strong growth in the second quarter thanks to premium original series such as "the twilight zone" and "cbs all access" and billions on showtime now, the last number we got on these streaming numbers was 8 million as of the end of the last quarter but no specific numbers for this quarter guys, back over to you >> all right julia, thank you very much do these numbers matter in the context of whether or not we're going to see a deal with viacom? >> not a ton it seems pretty steady in general. it's a similar story out of cbs. but ultimately it is a bit of a deal stop. >> what's the latest betting on that >> that they're going to start talking relatively soon, and it just seems like we don't know what the ratio might be or exactly who's going to run it. but it seems trending in that direction. >> they didn't announce a new ceo. they extended the interim ceo. maybe until the end of 2019. >> with the indication they could break it away in june. which sort of puts a little more impetus to keep things moving. but i'm sure they could have another extension if necessary let's talk now about beyond

meat soaring in its ipo debut today the stock's opening trade came in at $46 per share. faa far above the italian pricing of $25 per share beyond meat finishing the day higher by more than 160% how often do you get 100% plus >> no. it held the gains and built on them obviously it looks a little bit overheated, so to speak. basically, when you have this large growing market and a consum consumer product where you have passionate people -- >> overdone perhaps? >> well done a lot of passionate people about the mission of the company it can create a lot of this type of follow-on buying. i don't had i there's people sitting back saying we love the margin profile of this company it's strictly a huge and growing market we think they're going to save the world, we're buying it >> have any of us here tried them yet >> no. >> stephanie hasn't. >> no. >> which i don't know if that is

a sign of opportunity. because we haven't tried them yet. >> it's only 2% penetrated so to your point absolutely but burger king is actually doing some testing i'm sure you know the former ceo of mcdonald's is on the board. they have a lot of potential 100% revenue growth. >> a lot of celebrities which is important for these types of trends >> the question is long-term prospects and long-term profitability. >> exactly and what exactly is proprietary about what they are? is it just a brand do they have a molecule that somebody else can't rep will i kate that's the question. as this category grows there's going to be a lot more players they can't capture all of it >> and now there's going to be a lot more players going public looking at that price. expedia earnings are out seema mody with the numbers. >> expedia seeing a loss of 27 cents on its bottom line that was better than the estimate of its loss of 38 cents. but its revenue where it missed $2.61 billion. the estimate was for 2.69

billion. also we should point out room nights up 9% the estimate around there -- the estimate out there was around 9.4% so a bit weak on room nights as well in the first quarter of 2019 expedia also renaming the home away segment that's the home rental service to vrbo which saw gross bookings grow 4.2 billion. that's up 5% year over year. but i think it's the miss on revenue. 2.61 billion that's what seems to be impacting the stock. we'll continue to read through this aernlings report. expedia currently down about 5%. although i would point out up 14 going into this report this year >> room nights and revenue miss but only very slightly >> yeah, a little bit soft i do think people with bigger picture are going to wonder the home away segment, 5% growth in a world where airbnb is lining up for a potential ipo and they're showing blockbuster growth and that general part of the industry not necessarily dazzling coming out of expedia

>> expedia's down 4.6% after hours. activision blizzard numbers are out. josh has them for us hi, josh >> activision blizzard reporting eps of 31 cents versus the 25 cents that analysts had expected $1.26 billion on the top line versus the 1.24 billion that the street had forecasted. during q2 activision's looking for 23 cents that's versus expectations of 37 cents. 1.15 billion versus an expectation of 1.28 billion. they are reaffirming their guidance for the year, calling for 210 on 6.3 billion that does come below at least what analysts have been looking for. the company's also formally saying it is pursuing a new professional esports league based on its call of duty franchise. no launch date here yet but it has already sold five teams. remember, they already have an esports league based on their game overwatch i did have the time to catch up on the phone with the company's ceo bobby kotik about the quarter. one question i had was about that blizzard division

investors are going to see activision beats, king beats, but blizzard does come in light of expectations at 344 million bobby kotik simply telling me that time spent per player is up, meaning how much time fans spend on activision, blizzard and king he says we did double down on our franchises blizzard spending ahead, he tells cnbc, has the best pipeline he has seen more about that pipeline analysts will call out that is a potential challenge for the company. just that it has a relatively thin pipeline of new games for this year. on that point saying we invest for the long term, telling us all those pipelines across all his business units are in his words excellent and that he has refocused resources toward his biggest opportunities. also talked about fortnite that is another potential challenge for the game some analysts have said they really think activision blizzard maybe didn't capitalize on that

free to play battle royale genre. kotik having none that he said they're offering free to play games, exploring that across all our fran chooidss but he said we're going on deliberate and thoughtful before rolling all that out back to you. >> we've heard similar things from take 2. josh, thank you very much. >> at this point it's kind of a busted growth stock. it's well below the highs but not yet looking cheap because it was priced for such perpetual growth and right now they're in a retrenchment year. where the 2019 estimates are down 18 or so percent from last year next year going up to where they were in 2018 i do think until investors got a sense they can figure out this competitive situation not sure what the stock -- >> daily time spent per player across candy crush record high guess how long 38 minutes that's a long time >> i'm glad you gave us the answer i would not have known where to gauge that at all. >> yeah. it's pretty good as an addictive

product. i have secondhand window into it >> this is all about next year and the pipeline >> yes >> it is fairly thin relative to its peers. like take 2 has a robust pipeline it's going to lag until we get clarity on that. even though it's trading on 17 times forward estimates, which is not that xnsive but for what you're getting it's probably kind of a trading name at this point. >> down 2 point -- well, now 3% in the after hours shake shack numbers are out. aditi's got them for us. hi, aditi. >> hi there. yes, shake shack shares are up more than 5% right now after posting some really strong numbers. let's start from the top now revenue coming in at 132.6 million. that's compared to estimates of 126.3 million. eps was in line with estimates 13 cents the company also really had a strong beat on same-store sales. or same-shack sales as they call it went up 3.6% analysts were just looking for an increase of .9% so there's a huge beat there

and shake shack also raised same-shack or same-store sales guidance for the year to 1% -- an increase of 1% to 2%. previously they had only guided for a pretty flat growth rate there between 0 and 1% and shake shack also raised its full year revenue guidance to 576 to 582 million previously that was lower, their guidance, and that compares to estimates of 570 to 575 million. strong numbers shake shack's numbers up more than 6%. >> aditi, they don't have any fake meat on their menu yet, right? but it might come up on the -- >> it's all real and it's all delicious. >> although they do have portobello burgers >> i was going to say they have vegetable burgers but not pretending to be meat. >> they have a secret grilled cheese which is not on the menu. >> but there's no loss for one of these chains to stick one on the menu now i would imagine as it becomes more of a fad >> hence the 2% penetration we

were talking about >> exactly right but mike -- aditi, thank you very much for that same-store sales there, same-shack sales the standout. >> there's been a question about whether the store model, the single store model can actually produce a lot of sales numbers because they maxed out already that's a very good number of 3.6 and then the guidance. >> the stock has had momentum. it's climbing back toward the highs of what we got just after the ipo. there's so much excitement about it >> they've had to spend a lot of money on technology and the back office kind of things for the last several years they weren't able to see operating leverage they were seeing top line but they weren't seeing the bottom line this is encouraging. i would have liked to see an earnings beat. by like the guidance and the comps obviously very strong. >> it's a big burger day today on cnbc. up 6.5% for shake shack. stephanie link, love to see you. as always thank you for joining us >> gilead, shake shack both

higher expedia and activision shares are falling. cbs also lower after missing revenue hates. find out how you should be trading shares of the media giant. we're going to focus in on cbs straight ahead zblirs herman cain, now stephen moore withdrawing from consideration for the fed. neorill discuss who's xt f the fed board and who president trump might nominate next. here's one you guys will like.

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that direct to consumer number 71% year-over-year

growth, alan, where did that come in relative to your expectations >> that's a strong number. i don't recall exactly what it was a year ago but up 71% and the key after disney's big presentation last month all the industry is moving to direct to consumer, having a better direct to consumer bundle cbs has been talking about this for a while. last quarter they upped their three-year target. 8 million. originally hay target of going to 16 million by 2022. they raised that target to 25 million. i expect direct to consumer will be a big focus on the conference call today >> the real story with cbs has been leadership, tumult, and merger speculation bring us up to speed on where we are now. >> absolutely. maybe some of the weakness in the stock is ironically because the numbers were good. that makes the merger more likely to happen at numbers that might be more favorable to cbs, an expect ratio that might be more favorable. but look, there's no blocking this now the last two times les moonves

stopped this merger from happening. les is of course now gone. joe ianello is there he's been extended until the end of the year in terms of his acting ceo world even though national amuszments wasn't supposed to initiate this merger the two boards can initiate the merger. they've been having talks. it's just inevitable at this point. >> alan, do you agree inevitable >> i agree 100%. we put out a report a week ago saying we expect merger talks to begin within 60 days i assume the ratio will be close to where the would stocks have been trading on an average 60-day or so basis otherwise national amusements would be sued. and i think there will probably be a billion dollars of merger synergy if you put the two together and if you can put, for example, the viacom children's product, the viacom music product, and some other viacom content inside of a cbs all access. >> it's kind of ironic mt sense th when all this talk started it

seemed like one side or the other was going o'get a raw deal cbs's shareholders did not want to take on viacom. in this current media world it seems like you might as well have a breadth of networks to figure out what to emphasize, what to kill and to create some kind of bundle of your own >> this absolutely will add to the bundle cbs viacom can offer. but frankly more important there's one guy who didn't want the merger we have one major shareholder, the redstone family, that's been wanting this merger for the last two years. now they're going to get it. there's no stopping it it's clear that one of the reasons in my opinion they couldn't find a new ceo to take over cbs is because these merger negotiations are close and pending. and they've got to put it together whether it's bob backish when of course was just out at the milken conference. >> viacom ceo. >> whether the viacom ceo is going to be ceo of the company at least for a period of time.

and they have to see how they compete in this land of behemoths. >> that's what i was going to ask, bill. from alan's note, disney gained a cbs after it announced its streaming service in terms of market value the market really rewarded it. how much has the changed competitive landscape made this deal more urgent and where does a viacom deal stand? >> cbs getting size is of great urgency. whether viacom is the right waying to. it's tankly a moot pont as you if sherry rodestone wants it it's going to happen the question is if it still needs to get bigger via a discovery which people have been talking about and that would give you one of the best ceos in the industry and even if cbs viacom and discovery all got together would that still be enough to compete with -- it's not just disney it's obviously apple a trillion-dollar company, microsoft a trillion-dollar company, amazon nearly a trillion-dollar company. these are huge companies

cbs and viacom are what, 20 billion, 15% even if together they're 35, 40 billion if things go well. again, i mean, i think this is all just part of the redstone exit strategy. this is a necessary step in the redstone exit strategy in the meantime sherry can be a mogul. >> alan, quick final word. what's your price target >> i agree with bill on that the company still would be small and have to do this. my price target's 65 and i have a buy we continue to buy the stock i think the potential merger, merger synergies drive both stocks up. >> alan and bill, thank you very much for joining us. great to see you as always still ahead it's been another very busy after-hours earnings session. we're counting down to the earnings call for cbs, expedia, activision and gilead, which all start in just a few minutes. you will get reaction to shake shack's results. >> s&p 500 slipping this week after huge gains to start the year coming up, we'll explain why

hedge funds could hold the key to getting the rally back on track.

welcome back let's take a look how we finished the day on wall street. down half a percent on the dow

nasdaq down a similar amount the russell outperformer energy the big declining sector with oil prices sliding some 3%. >> another earnings mover monster energy making a monster move here on those results eric chemi with the numbers. >> monster beverage up 7% after strong earnings with big beats on both the top and the bottom lines. sales from energy drinks specifically coming in at $870 million. that surpassed the 844 million number that wall street was expecting. another consumer name to look out for, planet fitness dropping 9% after a revenue miss and lowering its guidance on full-year revenues, full-year earnings and full-year comps systemwide and franchise comps for this quarter, though, did come in above expectations planet fitness has had quite a run-up ahead of this report. the stock had surged 86% over the past year before giving back about 10% right now. back to you guys >> mike, your take on either of these? >> i was going to say planet fitness has had this amazing run

with a lot of skeptics around there wondering about the franchising model and wondering how long it could sustain some of that growth that's obviously going to hit some of the newcoming bulls. >> and monster beverage has taken a pause from its multiyear-long incredible rally in the last year or so there have been worries that coca-cola, which owns part of monster beverage, actually has a stake, is coming up with its own energy drink and there's just more competition coming to the market a number like this you see a big jump in the stock. >> time for a cbs news updat with sue herera. hi, sue. >> hi, wilf. hello, everyone. here's what's apg at this hour a former billionaire and drug company founder found guilty of racketeering conspiracy. john kapur and fore four co-defendants all found guilty of paying doctors to prescribe their opioid medication and then lying to insurance companies to make sure the drug was covered facebook banning far right leaders louis farrakhan, alex jones, and milo yiannopoulos

facebook saying they violate company policies about dangerous individuals and also organizations. in the town of buffalo, iowa residents lining the streets with sandbags to keep back the flood waters water continuing to rise and right now the only way to get anywhere in town is by boat. and check out this video from yesterday's dodgers game. a fan going for a foul ball loses his lunch. literally. spilling his french fries everywhere but just a couple of innings later a foul ball goes ought exact same spot to the exact same guy this time he drops his pizza unfortunately, right on the lady in front of him. she seemed to take it in stride. but what are the odds? there we go. there goes that pizza. >> and he didn't catch either of them and that other guy seemed to get smacked on the head pretty hard twice. >> look at that. >> oh, my god. they were trolling him >> back to you guys.

i know you have a busy hour. >> mike, have you ever caught one in the stands? >> i have not. >> have you ever spilled your lunch in the stands? >> the idea -- either you drop the food and catch the ball or you don't try to catch the ball and get out of the way that's what he did wrong >> suh, e, as always, thank you. >> you got, it guys. >> up next, speaking offer lunch, we'll get the shake shack earnings trade cbs, expedia, activision and gilead just kicking off. >> and stephen mooring dropping out of consideration for the fed. he's the second pick by the president in just would weeks to withdraw his name, although never quitnonae mited of course. what that means for the future of the fed this is the couple who wanted to get away who used expedia to book the vacation rental which led to the discovery that sometimes a little down time can lift you right up. expedia. everything you need to go.

here's a recap of the big earnings out so far this afternoon. cbs, expedia, and gilead all beating on earnings, missing on revenues activision beating on the top and bottom lines q2 guidance largely below estimates. and shake shack matching earnings estimates, beating on revenues it is the big winner after hours, up about 8% with those same-shack sales coming in well above estimates can't believe they trained us to say that instead of same-store

sales like we say for everyone else >> we've bought into their propaganda there beyond meat fishelly have the best ipo of the year so far. finishing the session more than 160% higher. the meatless burger company positioning itself as a viable alternative to real meat burgers and performing better than many of its real meat burger competitors on their first day of trade both shake shack and habit burger grill finished triple digits higher but fat burger and red robin disappointing on the day they went public january 2015 shake shack up 120%. >> what is it about these meat companies? >> i get we made the distinction, those are restaurant chains. right? so they were already kind of established restaurant chains where as right now we're talking about a company beyond burger that's trying to essentially create -- be a supplier to these things but part of the bull case for those burger chains was that the burger's infinitely adaptable

and americans' appetite for it seems to be inexhaustible. maybe beyond meat is feeding into that. >> shake shack is soaring after hours reporting that beat on revenues in same-store sales joining us now to dig in, josh brown, ceo of -- trader on the "halftime report." welcome to "closing bell," josh. >> i love your show, sara. thanks for having me >> thank you it's mutual. i love yours as well we know you are a big fan of shake shack burgers and the stock. have you owned it since the ipo? >> i've had a burger or two. i've been long shack since the ipo. one of the most formidable business books i've ever read is "setting the table" by danny meyer. i said i would invest in anything this guy does because he really gets this important concept that if you take care of your employees they will take care of the location and your customers and then as a result the shareholder is going to win. and never has that been more evident in this sector, publicly

traded quick service restaurants, than in the case of shack. so i've been long. i've seen the stock cut in half from where i've owned it i've seen it double. i've seen it all i've bought it over the years. and obviously now i'm very happy that wall street is catching on and they're realizing this company can grow and grow and grow for years and maybe even decades and there's a lot of room for this concept. >> and josh, i guess in terms of your point that it's doubled the last 12 to 18 months have shown much better momentum in the fundamentals and in the share price than the first 18 months of trade of this stock and the same-store sales again this quarter give you encouragement that could continue >> mr. frost, same-shack sales >> it's very hard to say very hard to say >> they're going international which is something i think was mentioned in the prospectus when they first came out but not a big deal was made out of that.

and now they're proving they can go into all different types of regions that are hungry for this comment. the other thing they've done really well which they don't get enough credit for is diversifying away from burgers so if you go there, you don't always want to have red meat you don't always want a burger not speaking for myself. i always do. but the chicken shack is a phenomenal alternative i think it's better than chick-fil-a's offering no offense no disrespect to chick-fil-a the nuggets they just rolled out, some people go just for the desserts obviously the titular shack, shakes themselves it's not just a burger story they've done very well rolling out. and who knows where they go next maybe they do a pizza. i don't know i met danny a couple weeks ago i got to tell him how big of a fan i am and that i'm his number one client and in addition to owning the shares, i will continue to be somebody that visits the locations. i was just in boston last week i went to a shack. the place was on fire on newbury street and you finds that everywhere that you see one of their locations. i'm bullish.

i'm long i really like the story. >> should they have a beyond meat burger? >> well, that's a really interesting question and i have not tried the beyond meat yet hopefully i'll get a chance to do that. and i know burger king is talking about using their product and i think you'll see a lot more of it and i have to believe that if anyone's going to get it right on the high end it's going to be danny meyer, it's going to be shake shack. so i will give it a shot if and when they roll something like that out >> josh, i guess i wonder how you think about shake shack as a concept in terms of what the ultimate footprint of the chain can be they're growing 20% a year in terms of store base. i know it's international now. do they still have that sense of when it comes to town it's a big deal, people want to line up to get it or is it routine now that it's in every airport? >> the app has alleviated the line that's also another untold story. and so when you preorder on the app, similar to starbucks, you can roll up right as the food is

being placed on the counter. so maybe it was good optically to have these big lines, but to me the consumer i don't think that's necessarily that important for the experience i'm not so worried about that. as far as how big could it get we talk in the tech world about total addressable market, how many people could have facebook accounts or instagram accounts i don't know that this could ever be the size of a mcdonald's, but look at the size of mcdonald's and look at the fact that they still continue to find ways to grow year after year it's a 60-something-year-old business at this point and they're not slowing down i don't think people should worry about are there too many shake shacks or have they exhausted the potential until we're talking about those numbers, and we're clairly not this is still in the hundreds of stores and could it one day be in the thousands of stores? i don't understand why it couldn't >> the two factors that, you know, you'll get pushback on on the name like this is eva klost.

also it's trading about 120 -- >> the valuation exactly. >> what, josh, is the appropriate valuation for a company like this? >> i'm so glad you asked that question let me tell you something i've learned over the years that has never let me down. valuation really doesn't matter in the short term as long as there's a lot of growth and a lot of consumer enthusiasm for the product. and i understand the concept that in the short term the market's a voting machine. in the long term it's a weighing machine. that's fine. i could point you to a million stocks that are trading between 10 and 15 times earnings that have done absolutely nothing for 10 years, in some indication 20s years. and i could show you stocks that were 100 times earnings five years ago and now trade at a more reasonable valuation because the growth was there and maybe they're trading 30 times earnings people are still complaining about the valuation. in the meantime these stocks have doubled, tripled, even quadrupled so it's not that nobody cares about earnings or ignore

valuation. focus more on whether or not the growth is there. and when you see beyond meat, by the way, and you see that ipo, by the way, not only is it the best ipo of the year, i'm waiting for the data it's the best ipo since the financial crisis why? a, there's some scarcity there aren't ten of those companies. b, santoli was talking about do they have anything proprietary yes, they do they have a fan base for their particular version of the meatless burger. and that goes a long way coca-cola is sugar water but they have their version and people like it so i think if the consumer is there, if the fan base is there, valuation will matter but much later. >> josh brown. learned a lot about you. thank you. see you later. "closing bell. still ahead, breaking down the charts hedge funds have been hesitant to embrace this year's rally but could that change? mike santoli will be coming over to the telestrator with more on that next.

>> and later, mooretion fed falout president trump's controversial fed pick officially backing out. more on that when we come back - did you know that americans that bought gold in 2005 quadrupled their money by 2012? and even now, many experts predict the next gold rush is just beginning. (upbeat music)

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hedge funds have been slow to respond to this year's market rally. but could that be changing mike santoli's at the telestrator with more. mike >> they've gradually been pulled into this market this is a chart of the equity exposure of one category of hedge funds, volatility kroeltd systematic trading hedge funds not really important what they do except they have these models that tell them how much equity exposure to have, based on general volatility levels and whether they should be in cash, bonds, or stocks this is from wells fargo and it's essentially a proxy for this category. here's what you see. a very, very dramatic peak in early last year. that was dramatically cut back once the market gets very volatile they really do slash their equity exposure. slow rebuild through the summer of last year that was the october peak of last year. and then of course you have that quick guillotine pullback as we saw in september, october. and now this is what people are pointing to. we had tom lee on yesterday during the show talking about how hedge funds are only slowly being pushed in and there's more buying capacity in this capacity you could say that's still the

case because they're still below 50% equity exposure. but right here that was below the prior peak you could have been saying last september they're not back up to the peak of last year, they're still going to be buying some more so really it all basically depends on how the market itself behaves. if the market itself remains relatively calm and methodical these guys are going to buy in i also thought it would make a opportunity to look at retail investors. the little guy's not in this market, the public is skeptical. this is the equity allocation in the american association of individual investors survey. they do this periodically, say how much do you own in stocks, bonds and cash here what you see, and this is a very long-term chart back to 1987 forget about this. i don't think we're getting back to necessarily late '90s norms when they routinely own more than 70% stocks. we are pretty close, though, to the highs for this cycle about 65%, 66% right now again, you were higher last year so there's room for it to rise but the market itself has appreciated and taken people's equity allocations up. i don't think you can necessarily say they're sitting out this market. >> it's interesting, mike,

because i'd say from the start of the year and even through most of q1, most of the reports when you say how high your cash balances were, cash balances remain very high, there's a lot of money to be deployed. but thoeth of these suggest that's not so yes, there's room to roam, but not elevated amounts >> it was among active managers and below 5% or something like that i think cash pays you something now so maybe it's less painful to hold it and it will be stubborn in going down and flows have not been strong into equity funds and nonetheless, the markets have gone up and people have held the stocks for the most part. >> mike, thanks. up next, no more for the fed. stephen moore, that is president trump's controversial pick to be on the federal reserve withdrawing his name today. we will dig into the fallout let's build a better world for investing. let's always put investors' needs above our own. as investment management professionals, let's measure up. cfa institute.

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weight watchers earnings are out and eric has the details >> that's right. weight watchers stock poppin higher on a smaller than expected eps loss, that's the big story there along with the guidance raise going forward revenues were a slight miss, but it's interesting to see the stock up 5% mostly on the fact that they didn't lose as much money as the market was expecting a 9-cent loss and a 25-cent expected loss in this quarter. back to you, sarah >> eric, thanks very much for that stephen moore withdrawing from consideration from the federal reserve board in a letter to president trump, moore wrote attacks on my character have become untenable for me and my family end quote. moore came under fire for his political views in past statements including negative comments about his ex-wife and

pay equity for women in terms of what this means for the fed is probably not a huge change in terms of direction and only going to be one vote anyway, and i saw one comment earlier that just means it gives the president further cover to criticize them because there's no one on it that he feels super aligned with in that sense. >> it gives him a few more picks that he gets to make because she's pick have come down. as far as the character assault that he blamed on that, it's really just going back to some of the previous writings that he made as an economist including i rule change that he proposed no women rests, no women announcers and no women anything and he sort of tped on this theme, women shouldn't play in playgrounds. girls shouldn't play in play growth funds and rec leagues with men uninvited this whole notion that he's been warning about the decline in male earnings which you can complain about wage growth, but don't blame it on a steady rise

in female earnings due to a rising fe pale participation rate at a time when we know women make up, what? 79 cents on the dollar to men in this economy >> it was a theme that was carried out. it wasn't a one off and he tried to pass it off as humor columns or something like that, but it is sort of ironic that the initial idea of him being nominated to the fed was mostly met with opposition from the orthodox economist profession saying this guy doesn't really get it and he doesn't really understand macro economics and no experience. >> that wasn't a problem that's not what ultimately seems to have sunk him. >> mohammed el arian said that the fed doesn't feel the markets, that is a direct phrase that president trump called the fed out for in december when the fed raised rates and, you know, muhammad has a good point after yesterday when the market sold off after the transient comment. >> there are openings if you want to get the president's

attention, you can agree with him. >> there are two ro posed nominees that went down for reasons other than economic philosophy how many others that would follow the line the president seems to want? we don't really know. >> that's how some people spin it he wanted someone who saw eye to eye with him and these were the two he found and for whatever reason he couldn't -- >> wall street journal mentions judy shelton as a potential pick sarah eisen is another one mentioned, we've heard. >> up next, your aft-hrserou movers and we'll bring you the biggest names making major moves. at'global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

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welcome back let's get a check making news after hours and expedia shares, due to weaker than expected room night growth down 2.5% shake shack surging after strong shake shack sales beat revenue expectations that stock is up some 8% >> don't miss a pair of big interviews on "squawk on the street," we'll be speaking with dunkin brands ceo david hoffman and we'll talk about the apparel athletic industry with the ceo of adidas, 10:00 a.m. tomorrow and guy, it is also jobs day >> adp has people's sights on

the high side. i wonder what the interpretation will be now that we're questioning in a bigger way the wage growth and overall inflation and it's hard to know what the fed implications are with the strong number. >> it's been a bumpy week and we'll keep an eye on the reaction and what it does for the equity markets and that does it for "closing bell," "fast money" begins right now. "fast money" starts right now live from the market overlooking times square i'm melissa lee. your traders are tim seymour, don grasso karen finerman and g guy. one top strategist says it is about to get worse he will explain and we're all over the after hours movers, and and we'll bring you the latest from the conference calls happening right now. speaking of earnings, 75% of the s&p 500 have now reported earnings so talk a look at some