billion dollars worth of chinese goods under tariff i think that was an important thought there. >> that and the notion that he's meeting directly with president xi he's much into this idea of personal relationship and forging deals with the counterparts that will be important also. >> thank you for watching "power lunch. >> "closing bell" starts right now. >> welcome to "closing bell. i'm sara eisen >> i'm scott wapner in for wilfred frost. the dow plunging more than 700 points at the low. >> we've got full team coverage for you as we begin the final hour of trade. bob pisani on the floor of the nyse bertha coombs is at the nasdaq mike santoli is at our new post with the market dashboard. kayla tausche is in washington with the latest on trade and tariffs, which is the root of this sell-off. and alicia levine, b.i. mel slon

here all hours to help break it all down for us. >> plus the stock stories you need to know including uber plunging yet again today here's a real-time look at it. down another 11% we'll break down what went wrong with friday's ipo. we'll also be looking at how sectors are getting hit by the trade war. health care, housing, tech, and media just a few >> and we're also kicking off a new series today five top fund managers for five days straight. coming up tom clune will give us his best ideas about the volatility >> the sell-off. bob pisani's been tracking it all day. it's been ugly not as ugly as it was earlier bob but it's still a nasty day at this moment >> you wonder how much the trade war continues to work. we were at 2801 an hour ago. steve mnuchin the treasury secretary making some comments he's looking for ways to go back to china to resume talks we came off the lows but not by much i want to concentrate on the industrials and show what you happened an hour ago 3m was at 172.

it's off of that 174. but this was $220 a few weeks ago at the end of april. that's a major problem there you can see with some of the other companies, industrials take a look at caterpillar caterpillar was 124 an hour ago. it's trying to get to 126. that's a pretty modest rally considering this was 139 two weeks ago. right over here, boeing right down 4% for the day. still trying to rally off of the lows there guys, back to you. >> appreciate it very much, bob. thank you. tech stocks getting hit hard today. the nasdaq's on pace for its worst day of the year. bertha coombs has a look at the biggest movers bertha >> well, ground zero is really the chip stocks. chinese fears hitting tech overall. but the chips are getting hit the hardest. 9% month to date right now slipping into correction territory after hitting a new historic high just 2 1/2 weeks ago. that sell-off today on more than 2 1/2 daily volume already a lot of it centering on apple

and its suppliers like nxpi and skyworth apple itself is on pace for one of the biggest volume days of the year its biggest volume day was the start of the year when it fell 9% on 91 million shares traded mylan is the day's biggest decliner here in the nasdaq. that's in health care. that is over a federal price fixing lawsuit against generic drugmakers but it's one of more than 120 new lows on the nasdaq including lyft, which is now down 32% from its ipo price. sara >> thank you, bertha so how much damage has really been done in this sell-off over the past week? mike santoli looking at the big picture. mike >> yeah, sara, dial it back about six excesses this is the sixth session of this trade-related freakout the market's been in i wanted to highlight one as peblth of it, which you guys have talked about, which is the intraday rally attempts that we've had just about every day you see back even last monday these are the end of days. you've tended to have a low early in the day it didn't look like we were going to stick to that today

maybe it's only a weak version of it. but you see today we hit this low just a little while ago. interpretation here is most of the down side damage has happened in the overnight session. the stock futures get sold very hard into the u.s. open. and you've had this gap effect and then on a net basis over the course of a day you do get a bit of a dip coming into the market. does that meanit's mostly global investors and retail on the sell side? unclear if that's the case and who knows? maybe the buyers are going to get fatigued p you have to get up the next morning and see the futures knocked down and undo what you bought the night before but right now at least tentatively we're sticking to this little pattern. and we also held just above that 5% pull bash threshold which is just under 2800. zblig question, though, mike, is how quickly you can undo the collective damage in the market if it continues for a while. >> yes, that is a tremendous question, scott. we didn't go that deep, we haven't gone that far back in time in terms of when we were last at these levels but it does i guess tell you that this last little push higher was dependent on a lot of

things going right and just this one little kind of added doubt on the trade front was enough to have a big rethink going on. and of course now it's broadened oud. you see the nasdaq underperforming today. it's not just because of apple and semis. it's pretty inclusive in terms of what's getting skimmed away >> indeed. mike, thank you. mike santoli let's dig deeper into the china trade development that sent the market plunging. kayla tausche in washington with the latest >> china's digging its heels in. retaliating with tariffs and suggesting it could back away further from u.s. business trade representative bob lighthizer is now expected to post the agency's list of products in the $300 billion remainder of chinese goods sent to the u.s. that could be subject to tariffs if the president chooses to go that route. trade experts are now focused on one detail in that release in particular and that is the date that those tariffs would potentially become effective if it's after june 19th, that's seen as a positive sign that the u.s. would not escalate tensions further before the g20 here's president trump talking

about that event >> maybesomething will happen. we're going to be meeting, as you know, at the g20 in japan. and that will be i think probably a very fruitful meeting. >> talking about himself and china's president xi jinping he also -- trade experts also expressed surprise at how reserved china's retaliation is so far it's delayed for three weeks and selective in which products are included even though they are targeting agriculture and china's been quiet on any further actions though potentially building in some hope for a deal in a few weeks' time scott? >> kayla, thank you. kayla tausche in washington. joining us now to talk about what all of this means for the markets is senior portfolio manager at ubs financial services charlie barinskoy is the vice chairman of ariel investment and ace l. levine from bmi mellon joining us for the hour how do you see it? what do you do on the market >> what's interesting is it looks like a classic tit for tat

strategy and game theory problem here because you have the u.s. putting on tariffs, going slowly on whether or not we're going to go with the 325, 25% on the next 325. and china going slowly signaling retaliation but a stepped retaliation. so not overly done and signaling a willingness to talk i'll say this. i think this goes longer than june i think the market has not priced in this going longer than june and today we're feeling it and i don't think we're done yet >> how much -- when you talk about getting priced in, how much more are you talking about? we're almost 5% now from the record highs on the s&p. >> right let's put it this way. the market has steadily moved up since the end of december on the expectation that not only were we going to have a successful trade deal but that we would deal with the intellectual property issues, that we would deal with forced technology transfer, and on top of that

that we would pull back tariffs and china would buy soybeans from us. kind of best case scenario and today we have to look at it and say even if we get a trade deal we may not be getting all these great things i think we probably have another 5% to go here. >> do you agree, michael >> i'm with that i think we're overlooking one thing, though, which is i think we're overlooking the changing that the fed did when they went from patient to transitory that got us a lot softer going into this. so we changed our language a bit. now we've got trade stuff as well tariffs implies splietly higher interest rates fed is sort of agreeing with that too being transitory. lately lower growth, earnings rates. so we have a softer market coming into this, and then what i think will happen is the market probably checks errant policy trump comes in, says sort of soothing words, soothing tweets to make sure we get babied until these next calendar -- >> is that going to work this time how many times have we been

through, this the soothing words, and then guess what >> it's a dance. the market is dancing with the soothing words if the market cries enough, if the market cries foul, they will abandon this >> at some point even the algos are going to say yeah, right that's what's purk the markshint around >> a beautiful letter, we have the constructive talks, and now we're back to our retaliation. >> this is the issue because when you have a calendar event like june 1st or the 28th or whatever, you can hedge against that position. when you have a tweet that could come at any time, it's very hard to take any position and that's why i think you're seeing a flat currency today because people are not expressing their views with totality because they just don't know how to position themselves. >> how much trouble do you think the market is in here today? >> you've got to distinguish between short term and long term short term we've got real problems this was not just tweets this seems to be a substantive change in the chinese position if ever you've negotiated anything important there's nothing that sets things back than one side retreating from a point that the other side thinks

was already given. and i think that's what we've got here so i think this is going to be tough for the next couple of weeks. i think long term president trump campaigned on improving trade agreements around the world. he thinks his constituents own a lot of stocks, they work in manufacturing jobs he thinks he ran on this long term we're going to get a deal but it's going to be tough the next couple of weeks, months >> where would you be, charlie you buy bonds? 10-year yields dropped below 2.40 today >> we're long-term investors slow and steady wins the race is our motto. so we would stay invested because it's not going to take anything but resolution to get a massive move up. but i think probably today i'd use my behavioral finance skills and be a little patient. there could be more trouble over the next few weeks >> alicia, what about the big picture? is that what's really needed for investors today? i've had people come on and tell me think big, buy the dip, because this is all going to

pass just like it has in the past it's going to do it again. >> i think that message today is a little too optimistic. and it's not just about today. so i think this is kind of the first crack that we're seeing. again, i would agree with charlie. big picture. but this is going to be a difficult quarter and this is going to be a difficult quarter because you're not going to be able to really ratchet up earnings for the rest of 2019 the way the market had really been pricing in the last few weeks with better first quarter earnings >> when do earnings get ratcheted down >> you're obviously seeing that activity today for sure. and i do agree i think there is a broader intention for these countries to close off their markets to each other and we're now just slowly aadjusting to that reality that's not just a one-week thing. that's a longer-term thing >> if earnings get ratcheted down the multiples get ratcheted down and you have a tougher case to make that stocks deserve to be where they are or perhaps anywhere close >> i think what you've seen is supply chains get repositioned relatively quickly if you look at what the tariff

impact was for the first quarter and the fourth quarter, you saw the weaker players go out but you saw a lot of redeployment. so this will be a little bit of final demand of consumer goods being affected but i think we're going to find there's more flexibility than we've seen in this change. >> appreciate it michael zinn, charlie bobrinskoy alicia, of course you stay with us for the remainder of the hour speaking of the hour, we have about 50 minutes left. dow right now is down by 570 it was down more than 700 points at its lowest level today. maybe some comments from the president in the last 20 minutes or so have brought the markets off their lows a bit, but it's still an ugly day following what was the worst week of the year on wall street, sara >> let's drill down on one stock that is getting hit hard again uber plunging on its second day of trading, dropping even further below that $45 ipo price. leslie picker taking a look at what went wrong with the most highly anticipated oip ipo of the year

>> right now the stock is about 18% below the ipo price. the main thing that went wrong here was pricing the company with underwriters clearly misinterpreting the market demand at $45 per share, which was already toward the bottom of the range they had been marketing investors who got allocation in the deal are sitting on paper losses of about $1.7 billion in two days' worth of trading the question now is wrhere is morgan stanley that firm served as the stabilization agent. that means they're able to support a falling stock price in the days after an ipo. they might have some firepower to do so but with all the volume being traded in uber's stock they may not have been able to make much of a dent. we have a request out to morgan stanley to comment but have not heard back yet, guys >> all right, leslie, thank you. joining us now with more on uber's ipo performance is steve clark from td ameritrade and tom white from d.a. davidson tom, which is it

is it the market turbulence in this kind of market we're in right now or the fact investors just can't get on board with ride-sharing stocks? >> i don't think the market is helping. i would say, though, our sense is that over the last few days investors have been taking a much closer look at the kind of case for profit biability with d sharing products we've had questions about whether ride sharing in general is it a good business, very simple questions like that >> what what do you say? >> i think it is it depends on the market i think the main thing people are wrestling with is if these companies like uber and lyft do pull the levers they have to achieve profitability will that make ride sharing less appealing for large parts of the population and could that reduce the size of the market >> you have i guess a window so to speak into the mindset of the individual investor unlike most. so what do they say? what do their actions tell you about uber >> ipos in general, they're such huge -- and we've had probably a

three or four-year period where we haven't seen as many. there's? pent-up demand and this one, you know, obviously a very familiar name >> household name. >> yes when we see -- facebook, for example, it's 22% of our almost million trades this one was 5%. it's kind of a new fronteer because they're staying private so long we're not sure how much interest there's going to be by the time they get to the market. today it's probably 2% of our trade volume which we would have anticipated would have been a little higher, but then again with the performance that we're seeing that's probably okay. >> you make a good point in that some companies, fidelity and others, maybe yours, they're investing now in late-stage private companies as if they're public companies and have been so for so long so you have to think about what the overall impact is once the actual listing goes for an offering and whether that's leading to selling. >> it's really a problem for the public investor because if in every private round you have to

ratchet up the valuation by definition you're crowding out the public investor and excitement and buzz is only going to get you so far, not just in a bad tape but when you're dealing with companies the economics look worse year over year you have to start doing your work. so you're setting up the public investor actually for not a great situation. >> yeah. i mean, i wonder also, tom, if it says something about the way the private market is valuing these companies. we've heard for a long time things look bubblicious when it comes to some of these valuations in the private market what's the public market telling you? >> i think a lot of people look back at some of the other dotcom sort of bubblicious type environments i would make the case that this round of companies that are likely to ipo this year, they're different in a lot of ways from those other companies. not all of them are profitable so that's one kind of ding against them but they've achieved scale in a way the other kind of

bubblicious companies didn't they've just penetrated the daily life of consumers and the u.s. population to a much larger degree and have established themselves in a way >> brand names like lyft and uber, if they can't do well i don't know what that must hold for the lesser-known names that are in the cue waiting to go public and how individuals are going to react when they do. >> i would say some of those lesser known names haven't been private as long. i think you have to think about it in that context as well and what i would say is, you know, although uber's performance has been very poor this reminds me so much of facebook if you remember what happened when facebook ipoed and it went all the way down i think $17 and we had a lot of inquiries and our clients said -- not that they all bought it's first day but they bought it over a period of time. and look at it today it's all about the duration. how long are you going to hold this and do you believe in this

company and its prospects? and if you do, you know, i mean, they have an opportunity to get in whenever they'd like. >> and you're telling people -- >> i've got a buy rating i've got a neutral rating on uber >> what target >> the uber target is $53. >> looking more like a buy >> it's moved into buy territory. we're going to have to do something about that >> tom white, steve quirk, thank you both very much let's send it back over to mike santoli who now has a look at three etfs feeling the pain in today's sell-off mike >> yeah, sara, these are three etfs that are a gauge on investors' risk appetite relatively underperforming today. in fact, one of them is the renaissance ipo etf. it's been an outtransform performer recently this is a basket of fairly recent etfs. not really about uber. i don't think it's in the etfs yet. but essentially just this general sense of backing away from somewhat more speculative longer-term ideas. this is the invesco s&p high beta etf basically the most aggressive or

faster-moving members of the s&p 500. a lot of either highly valued or a little bit more cyclical and heavily indebted stocks. that's down 3.7% as well and then the semi index, that's a little more on the news today. of course it has been in retreat pretty sharply down 4.2% very china related i think what we're seeing is a broad step back from risk. it's not just about figuring out the dollars and cents of what tariffs from china mean on earnings it's basically an occasion to say we have a much more volatile market, how much is my equity exposure feeling uncomfortable right now or not and now that we've had a little bit of a 5% pullback, guys >> mike santoli. mike, thank you very much. so alicia, if you own a semi, you've been leading the market, it's been a great few months, and now bam, information technology down more than 6% from the highs what do you do with those stocks with the kind of china trade tensions we're going through >> that's a great question because part of the reason the semis outperformed was the expectations not just of a trade deal but that are global growth.

both of those are in question. >> both of those are in question so the semis are the leading indicator of that i think you go lower here i do think, though, that the global economy's okay. i don't think that the trade skirmish is going to derail it it's just that your upward bias that we were kind of hoping for and the market seemed to be pricing in is gone and the question is what does the market do with that information? you're going to compress multiples for sure you're definitely going to have earnings -- and that's the issue. >> pharma stocks getting hit hard amid today's sell-off on news of a lawsuit alleging a conspiracy to inflate generic drug prices. meg tirrell has a look at the hardest hit names today. >> teva, mylan and endo pharma are all getting hit hard on the news of a lawsuit from more than 40 states allege the generic drugmakers conspired to drive prices higher in some cases by more than 1,000% among 20 drugmakers named in the suit and deny any wrongdoing the trade group points out that

price of generic drugs have declined in the last three years which itself has already weighed on these stocks. meanwhile, larger pharma names like pfizer, merck, and eli lilly are holding up a little better guys, back to you. >> thank you bond yields moving lower amid the sell-off as concerns mount over the ways that china could retaliate against the u.s. including potentially dumping treasuries let's bring in rick santelli at the cme group with the impact on bonds today that we're seeing, rick >> yeah, if the chinese were going to be dumping treasuries, i'm not sure that we'd be going out pretty much at the highs of the day, which we are. if you look at a three-day of 2s, a three-day of 10s, what you'll find is yields basically dropped and they stuck not a whole lot of trade now, granted, none of the coupon maturities are down double digits close. 8 or 9 basis points at the worst levels and a one basis point bounce but there's a lot going on here

that's mostly flight to safety and nervousness. you look at the dollar index on a three-day chart. a really different story as a matter of fact, dollar index came in under pressure, closed virtually unchanged and it is treading water better than any of the other markets to date let's look at some big trades in foreign exchange this is december 1st, the dollar versus the chinese currency. we've been talking about it all day. it's hard to argue that they are letting their currency weaken and getting prepared for what could be a long-term fight on tariffs. i have my doubts year to date the dollar-yen. there's your other safety trade outside of sovereigns. there's the yen of course at the strongest levels against the greenback since the very last day of january this year we want to continue to monitor those, but at the end of the day let's remember this. if we are going to have a skirmish with the chinese that could last a month or two, you're doing it at the right level with regard to treasuries because yields are much lower now than any of the analysts

might have thought three months ago. back to you. >> breaking below that 2.40. big deal, rick, thank you. another chart that's get something chatter, bitcoin prices are shooting higher a lot of people are looking at the correlation between bitcoin and the chart that rick just showed, the chinese yuan versus the dollar the faster chinese currencies fall, bitcoin goes up. is bitcoin a safe haven? who knows? maybe it's just that people in china are -- >> where we are now that it about coyne is a safe haven. >> it's a safe haven in china. >> that's what i mean. >> they see their own currency go down. >> if china institutes capital control, if the yuan gets to 7 or 7 and aboof, they're going to have to institute capital control, so,ably -- >> meaning they put restrictions on how much can we -- >> arguably bitcoin protects the individual from that kind of activity >> let's discuss this further. john miller is the co-head of global fixed income at

nieuwveen. john, welcome. >> thank you very much >> if this keeps up, how low are rates going to go? >> i think the so-ye10-year trey is grinding to 2, maybe 2 1/4. that has been the trend prior to this disappointment on the trade front. but it's also being driven by low inflation, the fed moving to the sidelines has been the big driver i think so far this year. now problabilities of a rate cu maybe sometime before year end are starting to become embedded in prices. >> the rate cut went up to past 100% for december -- do you think it's realistic china would dump treasury to retaliate against the u.s. in a trade war? >> i don't think that's the best tactic first of all, it's sort of inflammatory and during such a move potentially not

particularly helpful to china itself it could appreciate their currency further and make their exports more challenging also they're holding about 1.1 trillion in treasuries, roughly speaking about 5% of the treasury market. meanwhile, yields in germany are negative out to 10 years yields in japan are negative out to 10 years. and so the global market for treasuries i think would be okay anyway because global growth is coming down and inflation rates have been coming down. that's potentially more important longer term to the treasury market. >> do you believe more broadly that as jeffrey gundlach told me last year we're just set up for a whole lot more volatility in treasuries >> i think so. the treasuries have not been particularly volatile this year. they've been just in a gradually grinding lower but within typically a few basis

points move in any given day or week some sort of breakthrough announcement could certainly create a short-term sell-off but again, the broad trend due to fundamentals, due to the fed, due to falling inflation has been for lower treasury rates and in particular that's a global phenomenon when you look at global central banking policy >> we'll talk to you soon. thanks so much that's john miller at nuveen a little more than 30 minutes before the bell rings. some were hoping it would ring earlier at this point. the dow right now is down 637 points coming um, wall street's biggest firms factoring in the new tariffs into their gdp predictions. let's take a look at how much of a hit could be coming to the u.s. economy the biggest losers on the s&p 500. no shortage of them today. we'll be right back on this big sell-off day on wall street. as scott mentioned, down 650 almost woman: my reputation was trashed online,

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session on wall street ahead we have full team coverage into the close bob pisani's here at the new york stock exchange. bertha coombs at the nasdaq. mike santoli at the new post with the market dashboard. steve liesman is at headquarters with what economists are saying about this sell-off. contessa brewer in new jersey with how the trade war is impacting steel manufacturers. and morgan brennan has a look at the hardest-hit industrial sector bertha, we begin with you. >> 2 1/2 weeks ago we were talking about-time highs at the nasdaq we're down about 7% at the nasdaq from that but take a look at amazon. amazon slipping back into correction territory along with apple today. that's one of the big drags. and yet amazon doesn't really have revenue exposure to china you're just seeing a major sell-off on concerns as well about a potential slowdown in the economy. take a look at some of the communication names which have fared relatively better than the chip names nonetheless, they are all getting hit hard today particularly the gamers. media names not doing so well as

up-fronts begin as we either see what they're going to be presenting in terms of the next few months bucking the trend, a few names most of them tend to be in energy, infrastructure xl energy had an all-time high today. you have a reit and also another nursing home-related firm. both of them hitting new highs not in tech. back to you. >> let's go to bob pisani for the action on the floor. >> this is a world when the whole world is down 2% to 3%, doesn't matter what sectors you're talking about, even doesn't matter what countries we're talking about. there are some worse than others we emphasized industrials a half hour ago a bunch of retailers are hitting 52-week lows many of them of course import goods from china macy's, gap, nordstrom, l brands big declines today small groups of stocks that are more stable. a tiny group of consumer staple names today. hershey's. campbell's for example

kimberly-clark, general mills. generally more stable than the rest of the group although they too have been down gold stocks terrible performers. but gold spiking up today. all those stocks are up 2% or 3% finally, a small group of utilities are at new 52-week highs. companies like southern and xl a small group of consumer staple names. hershey's among them also 52-week highs guys, back to you. >> bob, thank you. we are launching a new series this week highlighting all stock fund managers and their top picks in this volatile market environment. joining us now to tick off the series is tom plume from plume funds. before we get to your picks what's your take on the volatility we're seeing and the uncertainty between the u.s. and china and how to navigate that >> days like this makes investing make in-some sense, when you want to try to offset some of the volatility of the downdrafts of markets like this. >> and how are you doing that?

>> well, in a balanced fund the way you do that is is you have stocks which are volatile and usually historically if you look at return and risk they're up here but it bounces around and bonds usually have less volatility so for the plumb balanced fund what we try to do is participate in the long-term nature of the stock market but then moderate days like this when you have significant down drafts. because nobody knows what day the market's going to drop this much and this quickly but we do know that we will have those at different times. the key is how do you live through those with enough -- or reduced volatility so you can take it to get the long-term return, the equities markets offer. so with that we use bonds -- i'm sorry? >> no, go ahead. finish your thoughts you use bonds and what else?

pardon me. >> well, bonds -- that's one of the things that we try to do for us in the plumb balance fund what we want is the bonds to moderate the volatility. with bonds you can take two types of rixz, credit risk or isht rate risk often when interest rates are going up and bond prices are going down or when the stock market's going down because of concerns about the economy, credit risk and interest rate risk are not high enough -- you don't get a high enough return to pay you for that. so what we try to do is stay with shorter-term high-grade corporate, grab some yield but most importantly moderate the volatility of the stock market because the stock market is going to bounce around like this but if you invest in the right types of stock we think you're going to get that return over time that you should get from the equity market. >> calming words for sure. are you a buyer of stocks today?

are you afraid this is going to get worse before it gets better? >> that's a good question. we're actually not buying any stocks today we're watching it. but you have cash, you have your bond, and you have the stocks that you really feel in the future are going to be a good return for today's price so we're looking at it, we're evaluating it, we're trying to decide which ones are being overhit by the market. but there are some really big companies today, and some of those companies are going to be the best performing stocks in five or ten years from now but they're also going to be some of the most volatile in between those time frames. >> give us an example of the few that you like. two or three >> stocks we like? >> yeah. long term. >> i'm sorry, sara, i had a bad connection i couldn't quite hear your question >> no, just looking for some of the examples that you want to

mention. >> well, we love companies like -- if you take a company like tyler technologies, for example, they provide software systems for local governments and municipalities so when you look at court systems, filing, paying your fines online, doing your appraisals for your real estate, things like that, a lot of those systems are out there and have been there for 50 years. and 50 years tells me they're sticky so if you can get in as a new system you've got probably a long life of working with that local government but if you think about it now, 54% of their sales are in subscriptions. so that means they don't have to come up with the next generation to get recurring revenue in the local government, they get the benefit of getting updates to

security packages and things like that without having to make a major change in the future in a niche market where they're the leaders and cash flow from software as a service makes it a really nice company. another company, for example, on a day like today, a day where you've got a lot of concerns about the industrial stocks, well, you pick a company like lockheed martin. 60% of their sales are to government for major defense systems. the f 35 is going to be a system used for the next 20 to 30 years. in madison, wisconsin we just got awarded the f-16 air national guard is going to convert to the f-35 fighter. that tells us that that space is going to be in madison, wisconsin for at least the next

20 to 30 years that's how long these programs are. so when you've spent billions of dollars developing these sophisticated systems, you're working with a good payer because the united states if they didn't have the money they could print it to pay you and you've got a long-range plan so it makes a very attractive long-term investment from our perspective. >> tom plumb, thanks for joining us today >> thank you, sara it was great to talk to you today. >> you too kick off our five-star fund manager series what do you think of this strategy, alicia >> i think it's an interesting strategy but obviously on days like today you're just going to get hit no matter what. i think for us we're looking at more contrarian places health care, which is the worst sector of the year as the rest of the market rallied. we think health care's interesting. not so much biotech but the services you've already had your bear market in it safe place to go also small caps have been underperforming recently in the last month or so

small caps are u.s. focused. they will be hit on the business side if the $300 billion in goods gets hit with tariffs. we still think that's a safer place to be in the short term. >> not today >> let's go back to mike santoli. he has a look at how anxiety is creeping into the credit market. mike >> just a little bit last week we were talking about how most of the nervousness was manifest in the stock market the credit markets were holding up pretty well they continue to hold up pretty well but if you look at a chart, one way to track the credit conditions is the hyg high yield junk bond etf. that is here in blue compared to a comparable etf essentially when these things are getting closer together it means that corporate spreads are tight. that's a bullish thing for stocks obviously, down here that's the big risk off panic from december and you've had improvement here. all the way until very recently, last couple weeks you see it diverging. that means the risk premium in

junk is widening out a little bit more so it's not necessarily anything like a critical level but it shows you that you are having credit conditions sort of follow the softness in equity markets right now. it's one of those things that you have to keep watching as a gauge of broader capital markets, risk on, risk off sentiment and whether you're getting some build-up of financial stress i would say right now it's just kind of a yellow flashing light, let's not be too concerned but definitely watch t >> good one, mike. thank you very much. alicia, what's interesting is the word follow. if you were really worried about recession, you would see it in the credit markets first, right? what does it tell you that equities are now leading this bond move? >> that's absolutely right, sara and this is the second time we've seen it because twe saw this in december also where the equity market sold off before the high yield market sold off it's selling off in sympathy i don't think there's a problem yet. but it's signaling that if there is a growth market you'll feel it in the high yield market and the leveraged market and that's sort of like the

white elephant in the room that what's going to happen if we actually have a downturn in the economy. >> right now, though, it's not causing anything it's just a follow-up. >> investors are getting slammed today on trade fears morgan brennan has a look at names getting hit the hardest. hi, morgan >> industrials really getting hit hard today you were talking about lockheed martin even defense contractors which don't have exposure to china are selling off today. so every stock in the s&p sector is trading lower this is after they had a big rebound to start the year. valuations for the multiindustry manufacturers have been elevated by some measures here's how to think about tariffs on these manufacturers this could be a one-two punch. you've got higher potential costs and import costs on some components and goods including those that are maybe being imported into the u.s. for final assembly here. and then you have the prospective impact of global growth and business confidence, which could mean less spending, less demand for the machines and other products that industrial companies are making case in point, farm and

construction equipment maker deere, which is the worst-performing industrial name in the s&p 500 today, this is one to watch worst day for deere since december 4th and they're going to be reporting earnings later this week caterpillar similar story. names with some of the most exposure according to dean dre'. 3m, emerson electric, flow sf serve, eaton, and distributors like w.w. grain sf ger also watch the transfer. every dow transportation average component is in the red today. that average actually re-entered correction territory in trading today meaning it's down more than 10% from its most recent highs. fedex, ups, expediters international. basically movers of freight that are real-time indicators of trade flows and the health of the global economy and guys, if you look at that data, that air freight data in particular for the transpacific trade routes, it's been weakening for months it also is very clearly linked

indicator for semiconductor billing. that's one to keep an eye on as i mentioned some of those names like fedex are ones to watch where that's concerned scott? >> good stuff, morgan. thanks so much let's give you a check on the sectors right now within the s&p. find out where the bulk of the weakness is coming from on a day when the s&p is down sharply as you can see by more than 2 1/2%. hovering just above what was at one point a critical level of 2800 utilities very defensive as you know the only sector within the green today. elsewhere it's right across the board led by technology. >> sharp more than 3% declines on that one. we've got less than 20 minutes to go before the close 17 to be precise let's get to cnbc headquarters where steve liesman has been looking at how the trade war, steve, is impacting these growth forecasts i guess for the u.s. and the world. >> yeah, sara. wall street economists spent the weekend trying to game out the impact of these renewed trade disputes and mostly reducing their outlook tore u.s. and

global growth and boosting their outlook for central bank easing. the problem is gauging these impacts it's hard enough on the economy. you've also got to field goal out probabilities on the outcome of trade talked, how long it all lasts, how equities markets respond and what kind of economic impact there would be from a down draft. the effect of all this on business confidence and capital spending jpmorgan writes the trade war could hold global capital spending growth to zero this year and dampen chinese gdp by nearly a percentage point. conflict escalation also would amplify the easing bias across the globe. goldman sachs sees a worst case down side risk to u.s. growth of .4 of a point and more if equities take a big hit. its report cites recent academic studies finding u.s. businesses and consumers pay almost all of the price increases from the tariffs and this leaves morgan stanley to forecast serious spend easing if the trade battle lasts three to four months economists see more chinese stimulus and 50 basis points of cuts from the fed.

>> yeah. the market move today also was pretty interesting looking at the fed funds futures, more than 100% chance now that the fed cuts in december is that going to be right? >> yeah. our probability is around 60%. 75% for december 90% for january. these are thomson reuters a little different from the cme. but pretty much the market has baked in at least one quarter point hike this year, sara but i will tell you we talked to neal kashkari from minneapolis and he said it's too soon to tell, he wants to get a better feel for the impact of these tariffs. the impact of rate cuts take a long time impact the economy and they're trying to figure out how those tariffs are going to -- look at how those tariffs are going to stay and the fed has to lean against them. >> good stuff, steve thank you. >> pleasure. those tariffs could have a big impact on steel manufacturers. contessa brewer at a steel factory in piscataway, new jersey

contessa >> estrada manufacturers and designs the parts for the railroad industry and it imports a lot of these parts already finished from china. so now 90% of them are under tariffs and remember, they just got slapped with a big 15% increase on the tariffs. they have filed for dozens of exemptions which are apparently some kind of bureaucratic purgatory, they haven't heard back from the federal government it's a small company and they are bracing for $14 million impact from tariffs through the end of this year they're looking for cost efficiencies they've shrunk the workforce by 10%. they are significantly slowing their expansion plans. and the c.o.o. told me they're passing as much as 10% of these costs on to their railroad customers. the railroads then pass it along to the shippers. the shippers then pass it along to their customers and then that way you can see this trickle-down tariff impact. guys >> contessa, have you had a chance to talk to any of the employees, the workers, about how they feel either politically

or economically about the tariffs? >> yeah, they're very worried. in part because stratto is a very family-oriented company they have put in place these bonuses that depend on the company's overall growth so right now the company is not growing. that could be as much as a 20% impact to these employees' wages, to say nothing of if there's a long-term trade war, potential cutbacks that come down the pike. it's very worrisome for their employees here. >> contessa brewer, thank you. we've got 13 minutes to go before the close here's where we stand in the market not quite at session lows but still stocks are getting a heavy beating today across the board it is broad and it is a deep sell-off the dow is down 646 points at the moment at the low it was down 719 but all 30 dow stocks are higher -- are lower, excuse me all red. being led by the abcs, as cramer calls them, apple, boeing, caterpillar, the china exposure

names, which continue to get beat up. >> to your point i'm looking at apple as we speak and as you were saying that i had to do a double take. it's not often that am falls 6%. but that's where that stock is right now for your a in the bcs. >> alicia, if you're exposed to china either from a demand or an import side right now, you're in the crosshairs >> you're in the crosshairs. the interesting thing about apple is when they reported earnings the stock rallied so hard actually, the business sell-off 17%. there was a bunch of people in the community saying this is really amazing, and actually the company's not doing that well, something stinks in the market there was an indication that there was caution to the wind, complacency in the market, something was going to go well and -- >> priced for this >> it was priced for this. >> having said that, you know, i think in the next few days this is not going to be a one-day affair we're going to price in a little bit more here and it's going to

overshoot on the down side as well that's what markets do and you have to be ready to pounce >> let's send it back to mike santoli who has a check on wall street's volatility index. >> i'm not sure we need a picture to tell us it's been pretty volatile. but here's a little perspective for a one-year basis on the volatility index what's interesting is intraday last thursday when we were kind of waiting on wins and needles for that tariff decision, that deadline on friday, we did get to about 23. a little above 23. so there really was an intense concentration, buying down side hedges or betting on a rise in volatility up to that deadline so yes, we're above 20 that still says this is kind of an unstable jumpy market, it's going to cause some kind of systematic fund managers to back away from their equity exposures. but it's not taking flight it's gone up to the 20% level intraday interestingly, the market has not been terribly volatile it opened way lower not too long

after 9:30 and it's kind of stayed there. i'm also interested in the fact you guys are showing the major indexes. the dow and the s&p for all their divers in how they're constructed, have been down the exact same percentage all day. it seems like just a blanket across the board index move, people basically stepping back what you're seeing here is not necessarily up near the levels of october just yet but of course that massive spike in december is still way beyond anything we've seen so far but 20 is a little bit of a marker of an unstable versus a stable market. that's where we're signature at into the close, guys >> okay, mike. thank you. let's zero in if we could on the losers in the dow. there are obviously many today three of the most prominent names, those so-called abcs. but there's a d and a u too. dow and united tech are down sharply. apple's down 6%. boeing's down nearly 5 caterpillar down 4 1/2%. >> p & g just going positive as the only dow winner on the day

stay defensive that's sort of the theme today utilities are the only positive sector right now in the s&p 500 but real estate zpamz holding up pretty well. >> eric chemi has details. >> sector on the cusp of closing in a bear market for the first time since december of last year, energy stocks are now down more than 20% since the most recent 52-week highs it highlights the stocks' continued strug toll break out amid uncertainty over future oil prices and global demand for crude. among the two names leading the group lower include marathon petroleum, devon energy, schlumberger and apache. the group up only 9% since the start of the year, outpacing only materials and health care back to you guys >> crude oil down 1.3% eric, thank you. let's bring in mime lillith, head of equities trading at barclays, to tell us what he's

watching into the close, mike. what level >> hey, sara how are you doing? so we're watching a couple different things obviously 2800's a big level for the s&p. but we're also watching the closing -- the close to close level of the s&p so if we close down north of 2% there's a little bit of a concern that we could see a systematic tomorrow, the beginning of a multibillion-dollar sell program from some of these funds that target a specific volatility on the s&p. >> we're way there right now, down 2.4%. just explain a little bit what that means >> yeah. we're down 2.4% now. we saw a similar thing late last week where we saw a sharp rally into the close we think that was gamma related. but the input basically is volatility so it's a good segue from the last portion of the show as volatility climbs volatility goes higher. as realized volatility goes higher the input to a lost these systematic strategies demands that they sell down their equity

position we could see liquidation on that front to the tune of anywhere between 10% to 12% of their allocation of equities over the course of three to four business days >> in other words, it's bearish. got it so mike, how do you see the reaction to some of the headlines? the market came off the lows when president trump said that he's going to talk to xi at the g20, hasn't decided on the extra $325 billion worth of tariffs. the market's not getting quite the same kind of kick on the positive 150 positive side from the trade news lately when there is talk of more talks. >> that's the key is how people take the news and that's why positioning matters so much. it's not so much about the fundamentals going forward it's about where people are in terms of sentiment and positioning. and there's just been a wild ride lately. i think all the urn certainty creates volatility higher. volatility goes higher you see more activity from the passive side than the active side. 35% of the volumes today

that shows people when volatility's higher they stretch for macro-related products my guess is until we get any certainty moving forward that people are going to shoot first and ask questions later and there's probably more -- >> dow's currently down 2.5% mike lewis, thank you very much. let's send it over to kate rodgers with a look at the restaurant space amid the sell-off >> restaurant stocks today overall taking a hit with the broader market of course due to trade tensions with china. the companies with the most exposure in china, starbucks and mcdonald's, which both have over 3,000 locations in the country and then yum china with more than 8,000 locations it is important to note, though, starbucks calls the country its second home market they've said in the past that they've been there for 20 years and they're well positioned to navigate potential tensions like this we did reach out to starbucks for a statement on the trade news we haven't yet heard back. dominos and papa john's we should mention also have a few hundred locations but likely not

enough to feel a major impact on this news today according to analysts from morningstar and btig starbucks, though, also owns its locations in china whereas mcdonald's and others franchise their locations. analysts say the coffee giant o'could stand to feel the impact more if consumer sentiment shifts in china but we're not really there quite yet starbucks did have a 3% com np china. back to you. >> kate rogers winding down the trading session. right now we have less than five minutes to go. we'll have the closing countdown next >> but first let's head to bertha coombs for a check-in at the nasdaq see what's moving there. bertha >> we talked a lot about the large caps with apple today looking like it's going to have a 6% plunge but it's the small caps that are taking it on the chin as well the russell 2000 back in correction materiality, down nearly 12% from its high and it hasn't put in a new high this year like the other major indices. among the losers a lot of companies trying to expand in

china like worldwide wolverine, it wanted to sell more merrill and they just -- a lot of the losers are at new lows getting punished tivo as well one note today i was looking at a headline today bloomberg reporting that t-mobile and sprint are looking at what kind of concessions they can do to try to save their deal a lot of speculation about that. both of them moved a bit but they're back down close to the lows of the session. back to you. >> bertha, thanks. >> bertha, thank you let's do the closing countdown now. mike santoli you're with us with bob pisani >> yeah. as well as art cashen's here low 719 down on the dow. lift aid little bit but then pretty much sideways the rest of the day. s&p almost down the same percent all day. >> don't worry, the trade wars, we're dealing with it. mnuchin's going to set up atrip to china

didn't quite have the power it used to have this is the day we have a global reset. if you look the whole world is down 2% to 3%. watch the country etfs everything mexico, south korea. it doesn't matter where you are. all of those global country etfs are down 2% to 3 1/2%. that tells me the world is resetting. global growth expectations lower. global earnings lower. the multiple -- you and i talk about the multiple the np should be trading at. we don't know what it is but they're setting it lower right now. >> you definitely saw the direct kind of china exposed stocks they're worse, right you see apple. you see semiconductors boeing and caterpillar it's kind of the standard playbook but it was broader than that it was kind of just a general step back from exposure to the market overall >> look at stuff like molson coors, pepsi, they don't have a lot of necessarily direct exposure, import a lot but they're a global company and when you have a global growth reset all of them get hit

generally. so you want to -- global growth is what matters. just because you don't sell in china you could still get hurt very badly when global growth starts to come down. most consumer names were down. a few smattering that were flattish today but you're going to have a problem if you see lower global growth. >> and art cashen, we're down about 5% in the s&p from the highs to today's low, i guess the question is what are we monitoring what are we basically pricing in at this moment whether it be with regard to trade or growth or anything else >> i think as you pointed out earlier a lot of us have been watching the vix but it has failed to spike. that's a critical thing. we're going to keep watching things like oil and the semiconductors and we're going to keep watching for tweets and comments because that's what moves markets these days >> aren't tariffs a permanent part of the landscape right now?

we don't know the answer is this about elections? could this go on for another year and a half potentially? they haven't taken any of the tariffs off. they're just still there and now there's going to be more of them and potentially more in the future now that this is really real we have to figure out -- >> certainly indefinite right now if not permanent that's what the markets seem to be bracing for you mentioned the vix. if you look at the volatility index futures, people are saying look, maybe it's going to be give and take for a little while. we're not going to get a quick all clear. but the market has a way of digesting these things and apply something else to be hopeful about. >> we have to focus on one thing. the election's going to begin pretty soon. so we could have this for a whul of months of negotiations but after a couple of months the election will be here and we'll need to deal with --

>> alibaba is going to report on wednesday. 100% china stock they don't sell outside the united states. if they're experiencing some slowdown in china that's really notable, we should hear it from alibaba. >> we're going now with the dow down just under 600. the s&p down 67. a brutal day on wall street for the bulls. welcome to "closing bell." i'm sara eisen here with scott wapner, mike santoli, cnbc senior markets commentator will be joining us from the floor in just a moment. take a look at how we finished up today on wall street. a sharp and broad pullback for stocks really across the board look at that ouch down 2.4% for the dow. 618 points at the low of the day we were down 719 s&p 500 going out with a decline

of 2.4%. and just to put that in context, last week was the worst week of the year the market was down 2.2% for the week today we're down even more than that looking at our worst day for the s&p since back in january. about four months. takes us back to a level on stocks we haven't seen since march 27th all of april just gets wiped out right there. the nasdaq having its worst day of the year. check it out down 3.4%. kept getting slammed today worst day since back in december and the russell 2000 index of small caps down more than 3% just overall plenty of carnage to go around we've got full team coverage of the major markets sell-off today. bob pisani is here at the nyse bertha coombs at the nasdaq. kayla tausche in washington with the latest on the u.s.-china trade battle which is giving the market plenty of jitters plus we will get jim cramer's expert take coming up later this hour on what to do next with your money. but first, scott, what's your general take you've been watching this all

day long the sell-off we saw today. pretty sharp >> i read earlier we were on track. now we're pacing for -- and i'm assuming this is still the case. for the worst may in 50 years. so even because we've come off the worst levels of the day by about 100 points, we're still tracking for a terrible may if it keeps up this pace. just think of where we were last week okay i don't know how many people assumed we were going to get to friday and get these additional tariffs in play. but we got friday, we got the additional tariffs you had the worst week of the year now you're building on that. i wonder to what level, to what degree does the president take this pain, given that he cares so much about the stock market and he's talked about it so often? however, he has also made the case that this issue of trade is more important than the stock market is that really the case? maybe it is. if this continues in terms of a market sell-off two more days or

three more days, does that remain to be the case? that's going to be critical to keep your eye on and if his tweets have the same ability to make everybody feel better, to make the algorithms react in a certain way like they have had most times in the past. >> i think the other big question has to be in this market what toll is this going to take on gloeth global we saw the move lower in treasuries copper, all the growth indicators really getting pulled back pretty hard and that is the question mark. if we take another percentage point off china gdp, is the market going to be okay with that a point off the u.s. gdp which economists are estimating. >> a point where you had started to feel some green shoots, that china, yes, they've stimulating and things felt better there -- >> record high priced for protection this is not protection let's get to bob pisani on this major sell-off day he's been in the middle of the action all day bob, what stands out >> what stands out is the whole market has suddenly experienced a global reset

everything is down 2 1/2% to 3%. technology's been a market leader but it was down 3%. health care has not been a market leader but it too was down 2% today and everything essentially in between i've been mentioning consumer names that on the face of it don't look like they necessarily have big exposure to china, the kraft heinz or conagra or molson coors. and again, this goes with that global reset mike and i were just talking about a few moments ago. we had very unusually heavy volume in country etfs today, and it didn't really matter what country it was practically not even emerging markets. mexico is down 2%. brazil's down 3% germany's down south korea's down 3%. very heavy volume. this is what i talk about the global reset that's going on why is this happening? because right now the long-term trade war implications are very clear for the stock market

number one, lower global growth. number two, lower global earnings and number three, the multiple that the market would trade at would be lower because you have lower global growth. that's why we've got this reset going on guys, back to you. >> bob, thank you. nasdaq worst performer among the major afrnlgds todaverages toda. bertha coombs looks at what's behind it. >> a lot of what's behind it was apple today. its second worst day of the year apple now down about 7 1/2% for the month. and you have to consider that apple started the month with a 4% rally we've given back that and then some with all the china trade fears the chips are back in correction, down 9 1/2% for the month. and we also saw a number of apple suppliers like skyworks today hit especially hard. mylan, the worst performer in the s&p and in the nasdaq, is now down about 25% for the

month. part of the reason is this concern about an antitrust price fixing lawsuit brought by the federal government against the generic drugmakers, mylan and teva among the leaders there but overall we're watching biotech today take it on the chin and this is normally a really bullish time for biotech because we're leading up to the oncology conference later this month. but you're seeing some of these stocks today hitting new lows in health care. back to you. >> all right, bertha, thank you. the u.s.-china trade war sending those stocks into a tailspin today. kayla tausche has more on where we stand today >> president trump and traeshszy secretary mnuchin weighing in on the tit for tat with china that sent those markets reeling in a bilateral meeting with the prime minister of hungary president trump says he loves the position the u.s. is in. >> we're in a very strong position our economy has been very powerful thrds h

theirs has not been. we've gone up a lot since the great election in 2016 and if you look at the numbers they've gone down quite a bit. >> he also said he hasn't decided to go forward with another round of tariffs on approximately $300 billion in chinese goods, quieting the saber that he's been rattling for several days the treasury secretary spoke to the national association of insurance commissioners and he stopped to answer questions from cnbc about where things stand with china before he went on stage. take a listen. >> when will you go to beijing >> we're working on dates. nothing confirmed yet. >> will china continue to buy our debt >> i assume so it's a great investment. but again. >> and how are you preparing for retaliation? >> i'm not going to make any comments on that right now, but thank you. >> are talked still ongoing? >> yes we're still in negotiations. >> so very brief remarks there from the treasury secretary, sara but people are hanging on where

he said the talks are still ongoing and that he is expecting at least to go to beijing at some point >> it seemed like he really did not want to answer kayla, thank you we'll see you in just a few seconds. but first joining us to talk about the markets today and how to navigate through all of this is scott ren, senior global equity strategist at wells fargo global institute alicia levine from bny mellon. mike-i want to get your thoughts first. >> very comprehensive sell-off i think when we wake up tomorrow you're going to have a lot of people saying we're down just about 5% in six days, we had a 90% down volume today just about. just befrg was down, and now we're in the market. i mean, now we're in the mode of saying was this enough of a washout for the short term i think we've now become conditioned to this idea that some headlines or some tweets or something on trade is going to dictate the next move. what's probably going to dictate the next move is does the market go to the down side enough it's going to bounce for its own sake

that's where we are now. i'm not saying we're bouncing immediately. but that's the assessment you have to do at this point 5% pullback from a high enough to account for whatever frictional effects we're going to have in global growth we don't know. but that's to me the key question and there are a lot of things that happen in the markets over the course of a year that could affect u.s. gdp by .2 of a percentage point and just because this one happened based on policy it seems like we think it's some decisive move for earnings and for stocks it might not be as much of a decisive move as we're sort of thinking in the crucible >> scott wren, we've seen this movie before or maybe we haven't. maybe there's a different ending than we're used to what do you think? >> i'll tell i, scott, for me 5% after a 26% run off the christmas eve low in the s&p 500, that's not much of a giveback i think for sure based on at least what we're looking at i would be shocked if we didn't touch the 200-day moving average, which is 2775 in the s&p 500.

you know, and below that really you're probably getting into the 10% correction type of territory. but certainly at least in our opinion the market still believes and we believe that there will be a trade deal, positives that come out of this over time. now, it's going to happen this month? no, it probably isn't going to happen this month. but over the next couple of months because as you guys have been mentioning, you know, global growth -- the fed's off the table. we're not worried about the fed. what we're worried about is global growth, this trade negotiation is a big part of what's going to be the global growth looking forward >> i guess, scott, then the question is do you trade the lower global growth prospects until we get any sort of sense that there is a time frame and that they're near a resolution a week and a half ago we thought we were there and now it's completely cloudy. >> if you're a trader, sara, i think there's going to be some opportunities. one thing if you look over the last year and a half or a little bit longer than that, this has been a market that has been very technically driven i mean, the 100-day, the 50-day,

the 200-day moving average, horizontal support you name it and this market has reacted around these technical levels our forward outlook is positive. we expect reasonable growth. we're looking for low inflation. we think the market's going to finish the year in the 2900 to 3000 range and we will we're looking at this down side as an opportunity given those assumptions. 200-day moving average, you want to probably have a little bit of interest there if we go down another 100 s&p points below, that i think there's probably good support there for us we're looking for an opportunity to put some money to work in large cap u.s. stocks. we already like emerging markets. clearly there's uncertainties there too. i think you're going to see some opportunities over the course of the next couple of weeks to couple of months probably to make some money. >> scott, thank you. that's scott wren. as we mentioned, china announcing a list of its retaliatory tariffs against the u.s. kayla tausche back with us now

with what we're calling -- >> china detailed a list of $60 billion in products that would see new tariffs. the highest 25% tariffs on items including beef, leather, cosmetics, beverages, and chemicals. but trade experts noted the list left a window of goodwill. not effective until june 1st and the list restated? existing tariffs but left them unchanged. now the focus turns to the u.s. trade representative, which had said it would publish today a list of the remaining items from china that would fall under its next sweeping $300 billion round of tariffs one key detail is when those would go into effect, a date after the g20 would be seen as a positive sign. president trump suggesting he'll meet with president xi there >> maybe something will happen we're going to be meeting as you know at the g20 in japan and that will be i think probably a very fruitful meeting. >> the g20 meeting is happening

june 28th and 29th of course a lot can happen before then. but certainly that window of goodwill is something that should be considered here. >> it would be interesting if we get a trade truce at g20 it would be the first time something actually happens at g20. kayla, what about the extra tariffs? the 325 billion that don't have tariffs yet of goods that come from china what's on that list? that seems to be the one that especially the retailers are really afraid of >> that's the one that's going to cast the widest net because it is the biggest tranche so far. it's expected to be about $300 billion according to the u.s. trade representative not the $325 billion figure that president trump often references and we heard on friday that that list could be made available today. so that's what we're expecting we don't know exactly what's on it but certainly things that have been excluded from previous lists like smartphones, that's something that could appear on this and give a lot of companies some heartburn, especially the biggest multinationals

>> and consumers that's the stuff where we're going to feel it the most. kayla, thank you chinese trade tensions also impacting the job market could cost 400,000 jobs over the next ten years that's according to the association of equipment manufacturers. let's bring in dennis slater, president of that association pf his organization has more than 1,000 members, representing over 200 product lines. dennis, what do you mean, 400,000 jobs that number certainly catches your attention >> what's happening is the trade war is really creating a huge uncertainty for our manufacturers as they look to build new products worldwide and sell products they're facing increased costs due to tariffs the steel costs have risen 6% or 7% now they're looking at other imports, things they put into their products to sell overseas. it's really hurting their markets and created uncertainty and huge pressures on their bottom line. >> is it realistic what the president says about he a

rebirth, if you will, of manufacturing in this country, turning back the clock by many, many decades he seemed to suggest the same thing again today in the commentary he had in the evil office what do you make of it >> yeah, our manufacturers represent $159 billion in sales every year what's happening with the tariffs is it's making us less competitive out there. we're going out there right now and saying it costs us more for u.s. products to be sold overseas we have a cost disadvantage there. and the same time tractors and combines we sell here are more expensive here in the states it puts us at a cost disadvantage both overseas and in domestic markets. i think manufacturing's been doing well but this uncertainty has really put us under a lot of stress right now >> the president also keeps repeating what we know is not true, that in his words china is paying tens of billions of dollars, it's flowing into our

coffers, when we know that the costs associated with the tariffs are being paid by importers and u.s. consumers >> right >> does it bother you that the president keeps saying that even though his top economic adviser larry kudlow was forced to admit on television over the weekend that it's simply not true? >> it is bothersome because let's be clear here, tariffs are a tax on the u.s. consumer and they're a tax on the manufacturers. it's going doft us more to create the goods we do, we'll be less competitive in the marketplace, and the consumer out there, it's $30 billion a year that's going to hit the u.s. consumer in this. it's just a huge amount of money. and on that side of it too these manufacturers, they're not going to be able to produce their products in a competitive way. it's going to hit us both ways >> we still have alist y. levine with us, bny mellon equity strategies manufacturing equities have not looked too hot lately. and that sometimes is a leading indicator. what are these higher tariff rates going to do for this sector of our economy?

>> manufacturing has actually been relatively weaker in the u.s. over the last few months anyway although it doesn't actually affect growth numbers as much as you would think because essentially we have a service and consumer-driven economy. so whereas in other countries such as germany you really get a big hit to gdp we just don't have that here but the issue really remains that i think the administration is going to themat on this and i don't think a tweet is going to do it i think the first stop here as your previous guest is 2775 on the s&p. and could happen tomorrow the way the markets closed today i think that's certainly reasonable and i think we don't stop there. it's not a one-shot -- it's not one shot down but it's going to a little bit >> the president says we are here to protect, we're doing this to protect our nation's manufacturers from intellectual property theft and corporate espionage and really complicated issues but you know, these businesses that you represent deal with

when they operate in china will it be worth it? >> we agree there should be a new trade agreement no, question about that but an escalating trade war is not the way to do it it's not going to help manufacturing. and not going to help u.s. jobs. >> do you think the new nafta's going to pass congress >> we're hopeful our two biggest trading partners canada and mexico, we really need this done we thought this would be the easiest thing to pass, but right now it just seems to languish there. >> dennis, thank you >> thank you >> dennis slater, alicia levine, our thanks to you as well. let's switch gears uber plunging even further below the $45 ipo price. deirdre bosa has a look at how the newly public unicorns are faring in the sell-off and not all that well, deirdre >> when you look at those names today you might think they're all in the same boat look at zoom losing nearly 10% pager duties 5% today. but you look at the bigger picture and start to see two types of ipos emerging this year on one side you have the

enterprise, profitable or less money losing names, zoom pager duty both up nearly 100% from their ipo prices. beyond meat has nearly tripled its ipo price and managed to stay in the black today when very little else could on the other sides you have the raid-hailing companies lyft has lost a third of its value and uber even after taking a conservative route losing nearly 20% in its first two days as a public company. now, ceo dara khosrowshahi told employees that during times of negative market sentiment the pes sniftic voices get louder and the optimistic voices pull back because even before uber's debut when markets were relatively calm lyft was struggling as investors focused on its losses. a certain path to profitability. uber is much larger and losing many more billions this all raises questions about the state of other unicorns getting ready to go public

slack saying it is planning its direct listing for june 20th guys, back to you. >> deirdre, thank you. joining us with more now on what uber's ipo means for the ipo pipeline, from bessemer venture partners talia, how much of a chill does it send through the spine of other companies that are waiting to go public this year >> thanks so much for having me. look, i think it's hard to draw too much conclusions on uber as one company at one point in time when they did go out and go public with what was a really tumultuous and is a tumultuous time in the market but overall i think we're seeing a story play out where companies that are burning a significant amount of capital and aren't that capital efficient, investors are reacting to that and are saying hey, we really like lyft but we like efficient growth and they're looking to see more of that efficiency. on the other hand you see companies like bessemer, pagerduty and pinterest which has fared much more favorably in the public market and i think some of that is a reaction to the fact they have a bit more of

an efficient growth story and it's easier for investors to see the path to profitability and long-term cash flows >> does this reset valuations across the board in the valley >> i think it's going to take some time for that to really happen typically we see about six months for public markets to really impact the private markets and to have that sentiment trickle down so what's happening right now, it's really -- this has been just a week, a short-term period but if this continues and multiples rerate over the next few months and becomes the new norm, i think that will start to have an impact >> go ahead. >> do you blame softbank at all? we keep talking about the softbank effect. they're pumping so much money into these late-stage companies and inflating valuations are they at all to blame for what we've witnessed out there it's like an arms race fueled by essentially one huge player. >> it's hard to point fingers at

any one fund or cause but i think softbank has certainly made it much more possible for some of these companies and particularly ones like uber that are in really competitive markets and are going after huge opportunities from ride sharing to food delivery to transportation and are giving them war chests. and they're spending those war chests in order to capture market share and to win. and so i think that impact that is shown in the cash burn of some of these businesses, and it's also shown in the reality that private companies are now staying private for much longer and are going public much later. so some of the growth that historically would happen in the public markets is now happening in the private markets >> talia, thank you. it's nice speaking with you. talia goldberg joining us today. >> thank you >> up next mike santoli breaks down the charts to see if the fear and greed indicator is signaling a buying opportunity amidst the sell-off. plus "d nes" jmamoy'im cramer tells us how much further

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industrials, consumer discretionary. financials, communication services, all got hit pretty hard worst day for the s&p since back in january about four months since we've seen a day like today. >> could the fear in the markets signal a good buying opportunity? the fear and greed index >>eventually that's the case i think the conclusion is we're getting there, maybe soon. far and greed index. essentially that's the market-based indicators. it's not an opinion survey these are things like the volatility index, credit spreads, all the things that go into indications of risk aversion or the embrace of risk in the markets it's at about 32%. this is a 0 to 100 scale the 32 is obviously more fearful than greedy. we were pretty close to 100 at the january top. obviously we got also pretty high a little bit later last year with the september top. here's the area where typically

it becomes a little bit more of a good risk-reward to bet there's enough fear in the market that almost no matter what happens we're going to go up this was after february of -- january of 2018. and of course the fourth quarter we stayed in that fearful territory as the market went straight down. there's no guarantee that just when this starts to get fearful that we're going to get some kind of magic bounce or buying opportunity. i would say, though, 32% this is a very steep drop considering the s&p's down only 5% i do think there has been a little more of a fight or flight response to this relatively minor pullback after a 25% rally mostly because i think the headlines are so loud and scary and seem so consequential about china trade. >> keep an eye on it mike, thanks nt ch more on this market meltdown and how the trade war with china is impacting everything from manufacturing to housing to retail. really helped me up my game. i had a coach. math. ooh. so, why don't traders have coaches? who says they don't?

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we've got an earnings alert on take 2 interactive. aditi roy with those results >> hi there, sara. take 2 shares were down about 3% they were down as much as 6% upon some weak numbers in earnings net bookings 488 million versus estimates of 506.5 million

eps came in at 50 cents gap. we don't have a comparable estimate there but guidance for net bookings for the company was weak but q1 guidance for bookings, the full-year guidance on net bookings came in at 2.5 to 2.6 billion. compare that to what the street was looking for, 2.95 billion. and the q1 guidance on net bookings was 310 to 360 million. the street was looking for 418.3 million. so big misses there. again, shares are down about 2 1/2% right now they were halted earlier but shares just reopened a few minutes ago. back to you guys >> we'll keep our eye there. aditi, thanks so much. back in the trade space, tariffs have topped the list of c suite concerns and many of the biggest firms on wall street spelling out on their earnings calms exactly how the trade war could weigh in on business, or could weigh on business courtney reagan joining us with more court? >> hello, scott. while tariffs aren't welcome news many companies are at least trying figure out how to work

through it now that it's a reality. last week emerson electric ceo david farr said growth slowed in the quarter as a result of last year's tariff impacts and associated price increases but farr thinks "we'll get a deal done" and that august could make sense for it in the meantime emerson will absorb some of the tariffs but not all. also last week snap-on ceo nicolas pinchuk says even if you're being dinged a little bit by tariffs you figure out how to mollify them in late april stanley black and decker instituted price increases in the second half of 2018 and earlier this year to help offset those tariffs. now, because consumers are the ones that ultimately pay more for tariffed goods, retailers are under particular pressure as that retail earnings season begins to get under way. 42% of dollar tree products are imported most of which are from china. 25% tariffs into 2019 guidance already. williams sonoma. now, walmart ceo brett biggs has said 2/3 of the retailer's costs

are sourced in the u.s remember a lot of that is food 1/3 imported and china is just a part of that we just don't know how much. but of course when you think about how big walmart is, walmart is the world's largest retailer, even if a third -- they import a third and only a part of that is china. those numbers have got to be big numbers. sara >> all right, courtney, thank you. those trade tensions sending stocks into a tailspin today the dow closing down 617 points. we're all over the major market impact of this tariff battle diana olick taking a look at how tariffs are weighing on housing. julia boorstin diving into the sell-off's impact on media names. and we're look at the toll it's taken on technology, a big one diana, let's start with you. >> the home builder stocks definitely took a hit today but not nearly as bad as the broader markets. if you take a look at some of the top ones like lennar, they were down barely less than 1%, which is relative outperformance compared to the rest of the market

and there are a couple of reasons for that number one, the materials affected by the tariffs are not the biggest costs for the home builders they're needing lumber and cement lumber prices significantly down compared to a year and a half ago when we saw canadian lumber tariffs go into effect and prices spike and then they calm back another reason, mortgage rates take a look at the average on the 30-year fixed down sharply from last november when it spiked over 5% it's pretty much sitting around the 4.2 level, not expected to go much higher and all the uncertainty in the market weighing on the treasury yields. that again makes the builders feel like they're cheaper now because you can get more for your money tough the lower mortgage rates if you take a look at the reit stocks, though, these are in the s&p real estate sector reits are commercial real estate properties they're actually faring pretty well because they are a low interest rate play again, though, going forward they own some of the properties that could be affected like retail by higher tariffs back to you. >> okay. diana, thank you now let's get a check on how the sell-off is impacting media and

social stocks. julia boorstin has more on that angle. julia? >> well, social media stocks are doing worse than the broader market, way down as well on those concerns about china and the market overall is also concerned about regulation and how limited ad targeting could threaten their business models facebook and snap each down some 3 1/2% twitter ending the day off 4 1/2% and pinterest faring the worst of all, off about 8% netflix shares down over 4% today while traditional media stocks are mixed viacom and cbs suffering more than the broader market. both down about 4% they also suffer concerns about being subscale disney and comcast in contrast are both down some 2% as this week's up front presentations featuring their new content as well as their ad targeting capabilities the telcos are faring the best at&t and verizon both ending the

day down less than half a percentage point now, analysts say they don't see too much near-term impact of the trade war on hollywood because there are already limits on how many hollywood films can be released in china and u.s. studios only bring home about a quarter of chinese stocks off revenue compared to the roughly 50% take that they get from theaters here in the u.s sara >> julia, thanks turning now to the tariffs' big impacts on technology, we certainly saw it play out in the america today. jon fortt with the story today >> a couple ways we're seeing the impact of trade wars on tech, one is stock with actual china exposure the poster child for that is apple. am saw a pop when tim cook said an easing in trade tensions had helped sales at the end of apple's quarter. apple's shed more than 10% since that post-earnings surge semiconductor and widget stocks, drives, connectors, things like that, nvidia, seagate, marvel, pure storage, all down 5% or more on china supply chain

exposure concerns. then you've got tech stocks that have little to know actual china exposure but maybe just seen as risky. uber sold its china business, it was down 10% zoom the video conferencing company that recently ipoed, sells subscriptions, not hardware, down almost 9% and pinterest which julia also mentioned down 8 but back to apple quickly the company out with a statement about the supreme court decision allowing customers to sue apple over app store price that statement from apple saying in part, "today's decision means plaintiffs can proceed with their case in district court we're confident we will prevail when the facts are presented and that the app store is not a monopoly by any metric." but guys, we'll see how that turns out. >> all right, jon, thank you for more on the trade war impact on technology, what to do with these stocks, let's bring in ed snyder from charter equity research joins us by phone. ed, who's the most vulnerable to the continued uncertainty between the u.s. and china trade issues >> it will certainly be the

companies with the most exposure into china apple's a good example of that they get a large portion of their phone sales from china and that's the largest portion of their total revenue. but it affects just about every large cap tech company in town t.i. a blue chip company sells there. to some degree and other you're going to be facing a downturn in china. that was a theme of this just completed earnings season. we had a number of companies saying business was not bad at all in the u.s. but very weak in china. outside of that, high data names obviouslysize the people start leaving and going to a safe haven until they find out how this is going to play out. even if you don't have a large exposure it's going to hit everybody until things settle in here. there's some thought that it hurts the product makers in tech like apple, as you just mentioned, but not so much the service providers. the microsofts, the googles, the other companies that do that rather than produce something physical within china. do you agree with that >> yeah, i do.

and that will show up in the next earnings season when you print revenue because obviously the folks that sell products are going to be more directly affected than the services guy between now and then it's going to be basically fear that's affecting all tech names and it will shake out when you get into the dry earnings season. >> ed, thank you for phoning in. ed snyder, charter equity research coming up on "closing bell," "mad money" and "squawk on the street's" jim cramer is here to talk about how he things investors should be trading around this market meltdown after a brutal day like today. we'll talk to him straight ahead. xeljanz xr. a once-daily pill for adults with moderate to severe ra for whom methotrexate did not work well enough. xeljanz xr can reduce pain, swelling and further joint damage, even without methotrexate. xeljanz xr can lower your ability to fight infections, including tuberculosis. serious, sometimes fatal infections and cancers, including lymphoma have happened. as have tears in the stomach or intestines,

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big sell-off on wall street today. dow closing low yeer by 617 pois s&p having its worst day in about four months, closing down 2.4% mike, there was a lot of damage to go around, and it wasn't just in the stock market. you saw the flight to safety and places like the yen, the bond market where the 10-year treasury yield dropped below 2.40 >> beyond meat >> beyond meat >> agriculture did you see what happened to soybeans soybean futures are getting pummeled on the front lines of this trade battle with china seems like there's headline worries just about pushing out the deadline on trade. and there's also global growth worries. >> the ag stuff is the most intuitive. you can't put it anywhere. you have to sell p or use it or

it goes bad. spillover was more the risk off effect you were talking about, just the global trade. we'll see if that has legs we don't know. >> joining us now to talk about today's market sell-off, "mad money's" jim cramer. hi, jim. welcome to "closing bell." so what would you tell investors to do? today was a brutal day >> well, it's too early. let everybody sell let the panic continue let's see if we can't find some level where uber stops going down let's start realizing that a lot of the tariffs the chinese are putting on the president's going to write a check or congress will write a check to the people that produce it. i'm talking about almonds, i'm talking about soy. i'm talking about beets. we don't make enough -- did you see the last dvrs, cameras we haven't made those in like 40 years. so i'm not as concerned about the tariffs as i am about the impact psychologically that they're having on the american investor, who's running so scared right now >> but jim, if they continue, if the market continues to sell

down, it's going to be a feed-on effect it's only going to have a more and more negative impact on the psyche of the investor when are they going to know whether the major -- the bulk of the damage is behind us? >> well, i think they'll know as companies do not preannounce, as companies do not get hurt that badly in earnings. i think that the psychology right now, we're in the last zone, think three, four days -- actually probably even tomorrow midday and then wednesday people will forget -- i mean, scott, the market isn't made up of mensa giants i mean, it's made up of people who have a mayfly's brain and they forget things they do. it's like -- do you remember the -- people don't remember these things so what happens is a few days from now we'll say why did we sell salesforce? they hardly do anything in china. and that's kind of like what happens when you throw everything away.

i mean, yeah, should you own deere ahead of friday's report i don't know deere is not the smartest thing to buy but remember, you're dealing with people who have the mind of a mayfly >> i get it, jim but what about the estimates wall street firms saying this could be worth half a point to gdp, one percentage point to the chinese economy. that has serious implications for earnings >> if that's the case then the chinese are probably going to have to come to the table. now, i know the chinese -- did you see the list i mean, is that all we're selling to them? are we that pathetic or are they so bad we don't sell anything scott and sara, look at that list of the pathetic things they're putting a tariff on. they obviously don't want anything that we have. and yes, the semiconductors are getting hurt but when i read the list, i said you've got to be kidding then how about the treasury? i heard you talk about treasury, sara we could use a trillion dollars'

worth of treasuries. this whole thing is ridiculous honestly, is it really about almonds? macadamia nuts are on the list too. so let's be very careful >> well, there's also baking condiments, chemicals, frozen fruits and vegetables. i buy those. >> a tariff on tito's? no vodka's made in the u.s. other than tito's. and by the way, how about a tariff on trout? really trout? how about eels sold to you. >> jim, what happens if the chinese really don't want to make a deal and they can just keep stimulating their economy -- >> you know what >> they're trying to wait the president out. >> wait the president out. i think the president has like a 200-year view and they have a 200-day move before the -- the party doesn't have all the cards. i mean, you know what? stalin had a 200-year plan i don't know

brezhnev had a 200-year plan how did those guys fare? honestly, we've got to stop being fearful and start realizing that the chinese have to come to the table a little more than we do. i watched their programming today. they really are presenting us as the pitiful helpless giant that nixon often made fun of during the war. vietnam, that is i had i it's time we look at what they're putting a tariff on and realize is that really the best you are is that all that we are able to sell to you that you're shutting down things that we will write checks for. because that's what good republicans do they write checks to farmers isn't that what congress is about? >> i mean, the president has said -- >> it ain't jefferson. look, am i being hyperbolic? versus what i heard today on our network, that it's the end of the world today as we know it. did we -- did they read what we're putting/tariff on? boy, they let us sell nothing there. other than apple, boeing, and caterpillar. it is all about a, b, c.

>> and they're big losers on the dow. >> one out of every four goes there. but if boeing's right the chinese need us more than we need them. apple is problematic and a lot of the semis got hurt because apple is at a cross-roads. but if apple pulls out of china, which it will not, but if they did can you imagine? it's got to be one of the biggest employers there. so i want to counter what i heard today and just remind people that they look at the fine print they would realize that this is about tariffs on pasta. i'm not kidding. pasta. we don't even make good pasta! >> i guess the chinese want to buy it sam, amazing shot. a little distracting with that beautiful shot in san francisco. we're going to look forward to your show tonight. >> guys, don't forget. almonds. okay that's what's on the line for us almonds. >> it's probably coming from california, where you are now. >> well, i've got to tell you --

stop worrying! >> got it. jim cramer, special "mad money" tonight, 6:00 p.m. eastern big line-up of ceos. jim is out west. he's talking to the ceos of workday, williams sonoma, twitter's cfo, and it sounds like he's pretty fired up about this china issue stop worrying. >> he certainly is we look forward to jim in a little bit up next the rise of the machines amazon making a big bet on robots and its workers in a major way. the reporter who broke that story coming up next ♪

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time for a tech check, a look at the biggest stories making waves in silicone valley. sharesp uber plunging yet again, now well below the ipo price of $45. the stock closing at $37.10, another 11% almost for the day on the second day of trade facebook says it's raising its minimum hourerly wage for $20 for contractors in its costliest markets like san francisco and new york and apple just launched its push into tv. iphones, ipads and apple tv including a brand-new app with apple chams. amazon getting hit hard amid the sell-off finishing the session, the stock 3 1/2% down. meantime right ersers reporting amazon plans to roll out machines to replace workers

loading up boxes jeffrey is here with us, who broke this story for reuters jeffrey, where is this and how quickly can we expect it >> thank you for having me we are seeing these machines today in driving distance from seattle, frankfurt, milan, amsterdam and elsewhere. and sources tell us amazon has looked at adding these very machines to all of its u.s. fulfillment centers for standard size inventory so it can be in many places coming up quite soon >> how far ahead is amazon in front of the competition on this >> so it's interesting, this technology which is from an italian firm called cmcsrl has been marketed for a number of years to different retailers we know that walmart, according to a source, has also deployed this machine, as well has shutter fly, jd.com in china but we're told amazon was among

the first to do so and it certainly making the most aggressive push we're aware of with the machines right now. >> the cost is set to be what, $1 million a machine and what is stunning is how quickly you say amazon can make back that cost >> right so when you think about amazon's shipping costs, this is actually pennies. so i think in the first quarter alone, amazon spent more than $7 billion on shipping costs and that includes a bunch of different things but at least comparing that to the price of this machine, the machine seems, you know, quite economical so a single machine is $1 million, according to sources, and there are operational expenses on top of that. but if you add two machines to the dozens of warehouses that amazon is looking at, and that's more than $100 million, so still not a ton of money compared to its overall $7 billion price tag

shipping in one quarter alone. when you consider the savings from packaging material, cardboard that's too big for the box that's coming to your doorstep as well as obviously from labor, the idea that you can crank out boxes at four to five times the speed of a human packer, you're getting to see a lot of those savings quickly such that sources say amany dzoa recover the cost in under two years. >> jeffrey datsin, good story. thank you for joining us still ahead -- stocks on the rise key things to watch as we head into tomorrow's sessions straight ahead standards of ethi. as investment management professionals, let's measure up. cfa institute.

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cfa institute. today's big sell-off, with the dow finishing the day down 617 points, worst day since january 3rd. lowest close since february 11th nasdaq turning in its worst day of the entire year >> let's get a check on the headlines making news after hours. shares of video game publisher take-two interactive have been volatile after missing wall street's revenue estimates and forecasting weak first quarter sales. stock right now is down by a touch more than 1% ten krent music is also volatile after beating profit estimates

and missing on the top line. take a look at that stock there. it's a fractional loser down about a third of a percent a lot potential market-moving news on tap for tomorrow investors awaiting earnings from ralph lauren and tilray, and the survey getting interesting to see if there's a rollover. >> yes, it's sharply off the highs. i think we're in the mode looking at the market react to itself we had overnight sell-offs every day since this bout of trading anxiety started a week ago this morning. so we will see if the pattern lasts. honestly, we're now looking down 4% to 5% market with not really that much tankable fundamental change i think how the market treats this idea, is it a buying opportunity or do we have to wait for a greater flush the thing about it, yes, we're at 5% but it's only six days you haven't had the time people to reposition if they have to downgrade the growth

>> what is the catalyst? the downgrade snap of a finger is unlikely, who knows, buybacks >> there's not a great single identifying catalyst what happens is the market gets oversold and we look at bond yields and say maybe on a relative basis, a lot of pain has been in the stock. >> maybe in a tweet. >> maybe that's it for us "fast money" starts right now. "fast money" starts now from the nasdaq market site overlooking new york city's times square we start off with the major sell-off on wall street. the dow down more than 700 points at the lows of the day. dow and s&p 500 having their worst day since january 3rd and nasdaq getting hit the worst, down 3%. its worst day of the year. this as the trade war between the u.s. and china seems to be hitting a fever pitch. eamon jabbers has more on that what's the late sneft. >> the president talked to reporters in the oval office