300 million people watched across nbc and they say it's up in line with the first democratic debate of the 2016 cycle. >> we will see tonight's debate at 9:00 p.m. it may be higher with biden, buttigieg and sanders and kamala harris closing bell is right now. >> welcome to "the closing bell." morgan stanley is up as we await the second round of the fed desk and a preview of that to come. an exclusive interview with the morgan stanley ceo james gorman is moments away. >> welcome, everyone another big event we are waiting for. nike earnings due to hit after today's close. a full preview straight ahead. let's see what is driving the market action. wall street is anxiously awaiting the meeting of the g-20 boeing a big drag after the faa

discovered new software issues and financials outperforming ahead of the stress test results. joining for the hour to break this down is josh brown. i asked you what the key stock indicative of this market is and what people are watching you said gld that was surprising. >> i thought that was a private conversation, sarah! >> nothing is private with me. >> i said gld because it trades like a stock and the dollar doesn't but what i'm really getting at i really feel the dollar is at a very critical level and i mentioned it was kind of sitting on support i think what the dollar does next from here could have big ramifications for everything from earnings estimates to emerging market stocks. >> it keeps weakening here. >> it hasn't broken down since trump has been president it's been fairly strong. some would say too strong. i know he would. >> for sure. >> you asked me what are people looking at and focused on, believe it or not it's the dollar again gold is huge five-year breakout

and breaking of the down trend is indicative of that. >> i think they are always talking about the dollar. >> i think the dollar is absolutely crucial not quite as crucial as you put it, sarah. but certainly we got -- >> everything. >> it is. >> it is everything. >> ask the president. >> it's a barometer. >> it is. >> we have got so much to discuss with josh. he's with us for the first full hour of the show it's the big stories you're watching today philip has the latest on boeing and we are tracking the biggest moves and latest on the g-20 summit and mike has his market dashboard. phil, let's start with you. >> let's talk about the boeing issue that was flagged late yesterday after faa flight pilots who are in a simulator flagged this to boeing and said we believe this needs to be corrected before this plane can be certified as safe to fly again and what we are talking about here is a software issue it's not related to the m-cast flight control system but boeing believes it is software problem, it is certainly looking at it

right now seeing how they can address that issue southwest airlines continues to push back when it expects to fly the max. remember, it was september 2nd and pushed it back and off the schedule through the end of september. you take a look at shares of boeing the thing we are waiting for, guys, is now when with will we see a recertification flight the first two weeks of july or pushed out a little while further? >> phil, if this got pushed back, meaning putting pressure on millenberg? >> more pressure i don't think we are to the point people are saying dennis mullenberg's job is in jeopardy. having said that this is dragging out much longer than people at boeing expected initially and even within the last month, you started to see the tenor of comments from airline executives change from, yeah, we expect by the end of august to now we are getting into the fall. certainly before the end of the year we are moving closer in that direction. >> phil, thank you despite boeing's drop, the dow is on pace to avoid its longest

losing streak since march. just barely. bob is here to look at the moves. >> four down days and might avoid that hope on china trade talks propelling china stocks higher and banks have been more stable the last few days than the ten-year stable around 2%. energy could overall weak but faye fading today as oil is flattish right now consumers big mover on the quarter johnson&johnson and coke walgreens confirmed full-year guidance and better than what people hoped for best first half in 22 years and up 17% and see if with hold that through tomorrow >> turning to trade. new headlines between a critical meeting between president trump and xi in japan. kayla is japan with the latest. >> joo t

>>. >> reporter: there is about a day between now and then there are some key conversations that president trump will have between now and then with other leaders that are descending upon osaka for this g-20 summit look at who the president trump will meet with on tap for those discussions is trade, north korea and the president's strategy on iran >> kayla, thank you. we send it over to mike for today's first market dashboard mike >> let me first tell you what we are going to get to. planet pizza a world josh brown i think might want to visit. individual indecision. retail sentiment summit suspense is where we are in right now a graphic showing you that and the fed fudge factor some data that go into the fed decision planet fitness got a new

initiated buy rating at raymond james and stock up it% i wanted to plot it against dominos. this is a five-year chart. here is dominos over five years and tremendous performer and planet fitness went public around four years ago. it's, obviously, kind of overtaken dominos. not just the fun of saying you can have your peas and work it off. they are both franchise models and keep costs very low. $10 a month at planet fitness and $10 for a large pie at domino's essentially they put more volume through their system than you think is possible. planet fitness has small stores and half of their people don't visit one of the gyms in given month and charge you ten bucks for the comfort of knowing you're a member of the gym mi momentum stocks are not cheap but they are working. >> what do you think of it, josh oi other than going to planet pizza? >> someday

i agree with mike. dunkin' is all franchises, another example of that. i think the big benefit for those stocks is that they have figured out that the u.s. consumer strip everything away is extremely lazy and will not cancel things that aren't costing them that much, so planet fitness, it's not like equinox 1 $$150 a month and you don't go every day and eventually leads to you cancel could probably make it $15 you're like i can't cancel because i'm admitting i'm a loser and you keep it going. domestic no domino's is an appear for other lazy people. >> do you think overlap of people who use as consumers both company's products or shareholders that own both stocks >> i think they make it easy to stay on and paying them. domino's to order from the app you can watch the car driving tour house it's the ultimate laziness play

so they have that in common incision to being e-franchise models. >> let's bring in lori at rbc capital market looks like we will break this losing streak but how are the risks stacked up >> so look i think we see puts and takes here we file like markets are range-bound the end of the year. i think you'll zig and zag i think at the end of the day there is only so much you can do i think we need to get through the weekend and i'm not necessarily looking for any kind of big positive news but we need to get through the weekend without any bad news then everyone is going to away for the fourth and we come back to earnings season i think this will be a pretty tough earnings season. >> how do you feel clients place in the moment in the defensive names? >> i would say everyone is looking at the defensive names but then everyone is in a very bad mood about it. we are having a lot of conversations with people about utilities which have had a nice

run. a lot of sticker shock on valuation. i personally think there is more room to do but a lot of clients just don't want to do it i would say we talk about staples earlier in the show. that's where we are seeing a lot of client interest pick up over the past week or two these are names that feel a little bit more intuitively to a lot of managers and especially on the growth side they had a pretty good earnings reporting season last time, one of the best sectors -- >> i don't know opinion tabout >> what is your -- i think the consensus is 9% drop in earnings is that what you foresee for the second quarter >> for the market? >> no, no. earnings is it the house view >> we have 2% on the year as a whole. so we think you're not going to have -- my model is tracking a little bit lower but we think a slight rebound in the fourth quarter. i think companies what we saw in the first quarter the way i described t they threw everything but the kitchen sink at that reporting season so we

saw a lot of companies talking about, okay, our tax rates are lower than it was a year ago ferocious buy-backs and lots of cost cutting and companies not talking about what they were doing in cost cutting but how impactful it was i think you'll see more that have i think we will muddle through but i think it's tough. >> we talked about the dollar earlier. if it were to break low, would it lead you to alter any stock positions you've got >> no. because we don't think we have an edge on how far that would go and how long it would last for i know people that do. those people typically are investing in the way and it's very far away and divorced what we are trying to do for our clients. however, i do think it would change the tenor of the discussions that we are having with clients and i do think there would be positives and negatives on both sides and i think the earnings picture would be impacted almost immediately by moving the dollar we have been through markets like that before 2014, 2015 is a good example all of a sudden you listen to

conference calls and get a feel why people are buying and selling and the dollar keeps coming up in these transcripts the other thing a typically adviser will a sleeve dedicated to emerging stocks and merchant market stocks is a good example the way dollar impacts equity holdings might not change nothing for fundamentals but a huge impact in the multiple and people willing to pay. we have to keep apprised of but not saying here is our call on the dollar and what you do people can do that i'm not that smart. >> by the way, it's still hurting and we are expecting that to be a head wind in nike's report after the bell today. lori, you sound pretty cautious and pretty negative almost on the market are there specific cyclical sectors you would stay away from right now? >> we think the market will be there at the end of the year on the cyclical side we want to look at opportunities like trade war are ultimately long-term

opportunities so we have been telling people to look at machine stocks we think the valuations are pretty cheap they have done a tremendous job with their margins it's not an over owned part of the market and what i think is interesting and we don't see crowding in that space right now. i think can you look in certain parts of consumer discretionary as well and reasonable valuations in the brick and mortar retailers and think people should be hunting around in those kinds of places. >> lohsy, thank you for joining us. ahead, dow component nike out with earnings after the bell the big focus will be on china get you a preview of what to watch from that release. specifics ahead. i sat down with morgan stanley ceo. if we see a rate cut, do you think that is good for morgan stanley stop line or bad given the issues his answer to that question and much more from the exclusive interview after the brk.ea [ alarm beeping ]

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welcome back i sat down exclusively with morgan stanley chairman and ceo james gorman and asked if the fed should cut rates he said favor a more assertive approach and the feds shouldn't use their

fire power too early >> obviously it's not good from a yield code perspective but it's good if it estimates activity in the markets and encouraged confidence. so these things -- we don't run our base based upon is a rate cut in a quarter going to matter but gives and takes on it obviously. >> when we look at credit quality, do you feel the rate cut is needed? are clients struggling to meet interest payments? >> i don't think so. no there is a lot of corporate debt the most exposed credit in the credit marketizing student lending. these kids have this debt hanging out with them going into their working lives. no i would say this is not a credit crisis we are not in a credit crisis. we are in a geo political confidence crisis. >> in terms of one big fear in the credit cycle people mention is leverage loans. is that something people need to

be concerned about and, if so, is it something the banks could get hit by >> i mean, the banks have been relatively conservative. most of the big heavily regulated including us would be regularly conservative i can't speak to the street. the unsecured online lending space which has been explosive the last several years once we hit a down circle that is one area where i would poke and prod a little bit. >> is it systemic in the way perhaps the mortgage link crisis was ten years ago? >> not remotely. i mean, it's just having lived through that, having slept in my office for weeks, not remotely this is a completely different environment. this is what you call a normal economic cycle and roughly every seven years you go into some sort of recession. question is it shallow and short, is it deep or long? what happened in '08 will was deep and long.

the economy is in solid shape. this is not remotely close. >> if we do see all of the big banks with the regulator approval return what is estimated 10% cash back yield, is that a sort of market for you guys to say to investors, look we are seller undervalued here and regulator ask a question >> good for asking for undervalued. obviously, absolutely. this is crazy. it's been ten years since the crisis our own capital basis has gone from 30 billion precrisis to over 70 billion today and balance sheet is a third smaller. liquidity i think three times precrisis. we are safer and better capitalized and trading we and

other big banks for value. listen in the short run markets get things very wrong often in the medium term sometimes if they misjudge macro long-term the markets is never wrong, you're the one who wrong. i think in a short-term bunks why the bank stock you just focus on the business and we are well capitalized. >> do you welcome the process you've been through? i think you had to submit 74,000 pages, is that right >> 72,000. >> oh, a little shorter than that. >> yes last year i think 57,000 and the year before was 45,000 to those who think dodd frank has been severely weak, it isn't true annual stress test making sure the big banks have sufficient capital is not a bad idea at all. i've said that many, many times. i don't have a problem with that >> i don't know if you caught the debate last night, the world bank was only mentioned once and

the culprit focus is much more towards pharma health care do you welcome that? >> wall street shouldn't be. let's be fair here we did the hard yards. we went through the crisis in our case we raised capital and took an investment 2 it% and did a ground breaking deal in smith barney and we cut risks and we built out our bank and wealth management for business and we shouldn't northbound the debate we are not the problem i'm not suggesting who is a problem but is there but in a politically debate somebody will find somebody to be angry at the banking sector in the u.s. is the best banking sector in the world right now. >> james gorman there. our thanks to him for joining us sarah, if we add in some of the comments and talk on the street where he said that he does expect the trade war to last for a decade, given that, given his view on the fed as well, i think

he is overwhelmingly positive about the outlook for the u.s. economy and for banks as well. he said that they are undervalued and said their share price is crazy i also would take from that tone, he didn't say anything to me specifically on this, that they will get full approval to return what they want to c shareholders because he seemed very relaxed about that. >> he is not the first bank ceo we have heard voice frustration over the valuation and the share price. >> both of them trading around book value this is much more specific. >> up more than the other years. why is that? >> he had a little bit of concern two years ago but this is specific and he explained the reasons why. >> asset management margins under pressure, pressure in wealth management. the biggest -- by the way, he has done a good job. but the stock is only up 2% in two years and up 25% answer is staring you in the

face a lot of the value at businesses that wall street traditionally has been able to charge for, they can't charge as much, investor preference is moving away from those things and they are looking for free trading, vanguard, i shares none of this helps one thing that he said is technically true but won't turn out to be during the crisis. the banks have much better balance sheets they fought that kicking and screaming and now love it. but risk can never be eliminated can only be transformed. the risk has been pushed on to a lot of the customers and in some cases willingly. when you look at where is the borrowing and lending revenue coming through if morgan stanley's management sheet is smaller? that will not look pretty in the next prolonged down turn hasn't mattered yet. we have 16-day corrections in december but in a prolonged down trend you will have people with wealth management accounts,

everywhere, they will say oh, my god, i now, all of a sudden, have to make sales in my portfolio for this money i borrowed morgan stanley will look for a risk like margin balance haven't seen it yet but you will. >> clearly you said a lot of these issues there a long time and trading around book value for sometime and it hasn't corrected. josh, what if this afternoon all of the banks get approval and the cash back yield dividend plus buy back for the sector is over 10% >> it used to be a huge event and buyable event. the bears said they will tell how bad shape they are in before c-car and get an announcement how much of a dividend to play and buy back and stock to explode and long time passed since a big catalyst bigger picture for these stocks ask yourself if they are selling it book value and value investors telling you five, six years they are too cheap, now

the street is coming along with the idea maybe they have been cheap for a reason all along paypal went from four times book to eight times book. you say who is not trading on book. >> you're not touching that is that the point >> i think they all being disrupted every single day and that is going on with the multiples. >> the clip we paid on the halftime report about facebook's coin he was not bothered about that at all and might be wrong but he is saying -- >> what is here now. people moving money on apps without the help of a traditional bank and your hope value is based on marble columns in front of branches that you've spent billions of dollars to acquire, it's a different world and i think that is what is weighing on the multiples. >> morgan stanley would argue we make a profit and -- support you? >> morgan stanley is very profitable i think they have don't know great job. i don't think it's a morgan stanley issue. i think it's a 21st issue that

aske affects all. >> breaking a losing streak the last few sessions and dow is up 20 and up as much as 70. up next, we will round out biggest analyst calls on word on the street. >> pfizer expected to give an update on a gene therapy treatment tomorrow and could have an impact for other names in the space we will tell you why next. this is my headquarters.

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welcome back to "closing bell." 32 minutes to go before the close. firm says tesla faces a number of head winds including competition from larger players and scale and will likely st. louis out as a niche automaker

goldman sacks downgrading nordstrom. costs from strategic investment and new flagship store in new york. >> deutsche bank on facebook calling facebook its top pick in megacap cap internet and around stories and optimism around instagram. they also like facebook watch. josh, i want to come to the credit suisse auto one not because of valuation but i think ford will take a lot of tesla. >> the european automakers are not waiting. i think what you'll see iand ths is what the tesla bears are saying it hasn't materialized

and maybe 2025 is the year you'll see audi's product and more of an effort from ford, for example. you will see electric vehicles coming the other thing that is happening at the same time is that a lot of those credits that you used to get are going away interesting to see if any of them can succeed in the market at a real price that is not government subsidized. a huge open question i do think that when they do ultimately break through, it won't be without the environment. it will be just about cost and price. but that is still a ways off i think it's a tough story to make that all of a sudden ford and gm will be these e vehicle plays. i don't know why they will get bought i think returning capital for shareholders and transformation is the key. >> the downgrade of norm strom after 30% slide so far this year is that late or does it suggest more to fall now >> we call those clown grades. like who are you helping, right? it's almost like -- >> maybe a leg lower i don't know. >> like somebody comes and kicks

a guy in the ribs after he has been beaten up you know nordstrom with not take an lbo now what you have a company with no catalyst in one of the toughest areas of the market. i think the cycle with these big retailers people get too negative and all of a sudden there is a short covering resurgence that happens every 18 months is that what you wanted you want to do with your capital right now? i don't think so. >> they downgraded roth stores too. pfizer is one of the best performing dow stocks of the day and the drugmaker will be closely watched tomorrow when update on key new treatment. meg has the details. >> when you think about buy a tech you think volatility and high risk, high reward and perhaps no other company in stock represent than more than s

sarepta therapeutics pfizer also has a program in that space and it's expected to present early data tomorrow morning that could have major complications for sarepta. you could see the stock swing 30%. keep an eye on solid biosigns as a small player is competing in this space >> thank you time for a cnbc update with courtney. >> here is happening at this hour. paul manafort plead the not guilty to multiple counts of mortgage fraud in a new york city courtroom this afternoon. the indictment alleges he reported in a year long mortgage fraud scheme to falsify business record to illegally obtain millions of dollars. acting defense secretary mark esper says the u.s. does not seek conflict with iran and he made the remarks in a closed door meeting of nato defense ministers. >> our goal is to bring iran to the negotiating people to conclude a comprehensive enduring deal that addresses

iran's nuclear program, its ballistic missile development and proliferation and its support for terrorism and other malaligned activity. nasa open doors in florida for a last look at the mobile launcher to get to the moon and to mars. it will launch nasa's space launch system and o'ryan capsule. that is your update for this hour back to you. >> cool. see you later. we have just 27 minutes left to trade at the moment the dow is lower by ten points high today was up 17, low down 17 essentially flat at the moment still head, the result of the fed's bank stress test is out the next hour. we will preview that. >> the g-20 summit is under way. the big trade meeting between president trump and xi we will suggest how the scenario could play out and how the

markets could react. a closing bell data tracker on today. final reading of first quarter gdp 3.1% and unchanged from last month and matching expectations but initial jobless claims rose by 10,000 last week to 227,000 above estimates of 219,000 we have under 30 minutes to go before the close we will be right become. back my degree from snhu has helped me tremendously. the flexible class schedules allowed me to go to work full time, run my catering business and be a mom and parent. when i reached this accomplishment,

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welcome back 23 minutes left of the trade wall street awaiting trump/xi meeting and boeing drags on the dow and franchise and health care lead. dow trading ahead of today's highly g-20 anticipated meeting between president trump and president xi they had an impasse earlier last month. for more on what this means for the market, here is barry. good to see you. >> thank you.

>> slightly worsening data makes it restart the negotiations? >> it may restart the negotiations where they were in late april for sure. i thought for sometime that logic for china was absolutely compelling and data two weeks ago, the chinese made that was, you know, really pointed in that direction what production they had in fixed asset investment was in heavy industry sectors, steel, cement, sectors they know they need to wind down and consumer sectors like autos, prouk falli production was falling the chinese logic for reforming their economy agreeing to stop subsidized is there. what was evident in this week's data from the u.s. was twofold our two single best indicators for productivity growth are labor market turnover and

dynaism and you get that from the month volt reports but before that you get to the plenty full jobs hard to get were labor differential is a key indicator. now it was two cycle high in may but it fell sharply in june. also, capital spending plan six-month forward from the regional fed manufacturing surveys had surprisingly gone up in may following through from a move higher in march, april, then in to may but fell very sharply in june and gave that whole thing back there is -- it's pretty clear that trade policy uncertainty is a big issue for that capital spending outlook going forward. >> is it going to affect employment we see jobless claims higher is it going to affect what is the best part of this economy and what president trump loves to talk about, the job growth? >> that's where i'm going with it i'm not a big fan looking at the last month's payroll number.

every quarter, 25% of the labor market turns over and when that turnover goes up as in 2014 and 2017 through most of 2018, that drives wages up but it also drives productivity up that is a big part of the pickup and labor productivity that was so shocking to the street last year if you see a deterioration in that dynaism, people voluntarily quitting that is a negative for that productivity story in the mix of growth that has kept inflation down yeah, it's tenuous there has to be at the time. >> long-term do we see meaningful economic structural change in china or not >> i don't think there is any question i mean, they have had two basically what i would call malinvestment busts the last five years first heavy industry and now it's the export sector you look at ordinary imports they went from plus 10% in early

2014 and now minus 10 and plus 18 a year and a half ago it's weak. >> shanghai is up 19% year-to-date is that mostly a recovery from q418 or something going on with chinese stocks people are not aware of right now >> actually, the decline started even before that as soon as the trade war got picked up in may, china got absolutely destroyed so i think most of what you're seizing a recovery and hopes that there will be -- but if you look at the core fundamentals, they have deteriorated badly earnings growth went from plus 10 to minus 3 and revenue growth looked like it was ticking back up but plus 3. producer prices for manufacturing went from plus 6 1/2% a year ago to plus half a percent. there is serious margin pressure there. i think the market is rallying as a rebound and on hopes of a deal but if there is no deal

china could get -- >> sometimes if they step in >> the ramifications of this is not about chinese people specifically generally, portfolios are managed based on the all country world and that is the benchmark. msdi made a big bet on letting the chinese exposure in their international indices and world indices get much bigger in recent years on the premise that performs would be serious this time and a big crash in chinese stocks or the upside in chinese stocks has an impact on u.s. retiree portfolios. >> interesting timing, by the way. no no doubt chinese have no other choice in the late '90s they had no other choice but to scale down soes and it's there again. >> barry, thank you. >> we have got under 20 minutes to go. 18 minutes to go before the bell here is where we stand

the dow dipped negative and in the last few minutes came back positive nasdaq doing better up three-quarters of a percent and russell is making a big leap back for small cap. >> the latest result of the bank stress test said to be released after the close. which banks may or may not be given the green light for more buy-backs. before we head to break, here is how the big banks are trading.

14 minutes until the close all three major averages positive let's send it back to mike santoli. >> often a thursday we look at the weekly aai retail sentiment investor for a bit of a mood check on retail investors and showing a lot of caution out there and lack of conviction despite the fact the s&p did click to a new high last week. you're seeing more bears than bulls. the survey respondents are asked how do you think of stocks the next six months. here is the currently reading.

bulls here and bears there you see a lot of neutrals in there. a net bullish signal when the market is at a new high and people are not buying the high buy. i highlighted two other periods you saw extremes this is mid december of last year here you see massive advantage up there over bulls. a pretty fat pitch in terms of saying the sentiment is washed out. the high for this current run was may 9th, the week of may 9th. you saw modest advantage of bulls over bears basically, retail investors are agnostic on this market. maybe we need better headlines for the companies to get the retail for highs to get on board. >> 13 minutes left of trade. we are high now on the dow back close to the session highs on the s&p a bit of them for the dow but the nasdaq and the russell 2000 up. >> everybody is up in the market except for energy in terms of

sectors right now. >> up next last chance trade. continental ceo gordon bethune is with us you should be. excuse me, where is gate 87? you should be mad at non-seasoned travelers. and they took my toothpaste away. and you should be mad at people who take unnecessary risks. how dare you, he's my emotional support snake. but you're not mad, because you have e*trade, whose tech helps you understand the risk and reward potential on an options trade it's a paste. it's not liquid or a gel. and even explore what-if scenarios. where's gate 87? don't get mad. get e*trade and start trading today. ♪ as your life grows, so do your needs. ♪ and with bank of america and merrill, the benefits you get can grow, too. as a preferred rewards member, you can enjoy priority service and exclusive discounts... so your growing life can be more rewarding, too.

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welcome back under ten minutes left for trade. josh, what you got as for last chance trade >> i want to talk in video the stock got above 50% moving average for the first time in a while. that can a thing for traders specifically i asked this chart to be made. we are showing you three years a weekly closing basis we want to focus in on this 200-week moving average which is a very long period of time but you can see the buyers came in the first week of june where they should have if the stock was maintaining at a minimum its consolidation. under the week moving average and higher along with the overall semiconductor sector which looks way better than it looked two weeks ago it bounced where it had to to maintain its trend i think you can be long here i know volatility around the earnings and whatever outcome, if there is an outcome with the

talks of china, around every seminame this was almost a 300 dollar name i like it off this bounce here and i'm along for years now and i would stay in. >> make gave you extra confidence earlier in the week >> not really. these are graphical process units. one interesting thing -- real quick right now it is moving up along with bit coin and what stung this company a year ago was when they had to report lower gpu sales. they are stenks usextensively ui coin mining. if gpu is catching an additional tail wind will help them as well so maybe something to that. >> nvidia is up 3% next ♪

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>> yeah. thank you. so a couple of things we are watching going into the close and in to tomorrow first, techs say this industrials have been rallying big new 52-week highs. we have seen the transports diverging. broader s&p 500 has been making a new 52 opinion week high and russell diverging. granted we get reprieve today and broader markets higher broadly but any short-term strength i think will be sold in to secondly positioning into month end and quarter end. health care seen a couple of gels tbi deals over the last couple of weeks. the group lags here-to-date elsewhere with risk on assets, we still see, you know, moves higher today but a lot of this has been short term buying to

cover. so a lot of shorts getting -- taking pain here going into the last day or two. >> thank you for joining us. we have to leave it there, i'm afraid we have breaking news on boeing. phil has the details for us. phil >> take a look at shares of boeing the stock moving lower i have just talked with the boeing official who has confirmed for cnbc that boeing is expected to complete its work on the 737 max, including filing for certification in the september time frame that is farther out than initially expected by most people who have been watching this story develop over the last couple of months initially people were thinking they might apply for recertification by the end of july but boeing is telling us, a boeing official has told us they expect to complete the work, including filing for recertification in the september time frame real quick that means that if that happens and if everything goes quickly, if the faa says, we are good to go, put the plane back in the air and you take another 30 or 45 days for the airlines to get

the planes ready, it may not be flying until the end of october and may not even into the november time frame. >> phil, thank you very much boeing down 3% and been there much of the day. a confirmation a delay josh any reaction to that for september to put certainty on it >> confirmed confirmed >> no. reports all day without a direct comment to phil . >> i would say most of the volumity on this issue is long behind it and doesn't necessarily mean the outlook is great for the first six months from september there is still a lot of adjustments made to how much they have to spend to clean this up these things take a long time. wall street will get over it way before the media gets over it and that is the good news. >> boeing is still the biggest drag on the dow taking 69 points off the major average. now to the nasdaq. frank holland is there with

update. >> wall greengreens had a beat n earnings and having a best day customers can pick up and drop off packages at rite aid stores and rallying on the deal g-to summit but intel trading lower on a possible email take that was reeked praising its rival amd and sisco with the biggest negative impact. >> sort of a status quo day and narrow reach for stocks. interest rates fairly steady a bit down here. dollars steady and semiconductor china hopes there. health care leading despite the discussion of medicare for all on the democratic debates. interest rates stable and ten year stable around it% and utilities down the last couple of days reads but last two days on the stable side here so see

what goes on last day of the quarter tomorrow 17% on the s&p 500 the best gains from the first half of the year in 22 years see if that holds up on the final day of trading tomorrow. russell rebalancing as well. boeing dropped the dow into negative territory toward the close and fractional gains for the s&p 500. dow down 14 points welcome to closing bell. let's check in on the markets. dow was a lag on just negative because of boeing's effect boeing closing down close to 3%. the s&p up 0.4% and nasdaq up 0.7 and russell up 1.89. the regional banks index was up

1.5% and talks to why we saw the russell outperforming banks at high weight in the russell 2000. we are awaiting the c-car results in 30 minutes time and financials was the best performing sector on the s&p. >> one group that stood out to me around the trade noise is hopes for g-20 trade talks and industrials lag behind and finished higher. boeing 3% decline will hurt that group. they did do better yesterday in the wake of durable weaker goods. if you watch certain pockets heading into these trade talks we talked about lot about semiconductors and a lot on industrials. they have so much china exposure in terms of revenue. joining us to talk about the market today josh brown is still here and liz young joins us director of market strategy at bny melon investment management. first up, mike, to you what was a pretty broadly winning day for the s&p. only energy closed lower.

>> again, quietly so it was more cyclical and stuff beaten down. what we can't tell after two days of this type of activity you're selling the perceived stocks for the more riskier areas is whether it's quarter end rebalancing and kind of letting that stretch rubber band kind of relax a little bit we don't know but i think it's net constructive you say, sarah, 2-1 positive as to negative stocks in terms of breath and everything else was quiet. we are waiting for potential market. >> liz, does that constructive sound about right to you you happened to look past the negativity of the market >> i think central case for the markets prop it up the rest of the year and the biggest risk to the market right now everybody is talking about trade the biggest risk and i don't recognize that it is a risk but i think the biggest risk is the fed doesn't cut as much as the market expects it to. >> what would happen >> then we would see a bit of a correction if that doesn't

happen, especially if we get news because we are going to get news from communications from the fed first whether or not they do cut. when we get that news or when they signal they are probably not go ing to, then i think the smarkt market is ahead of itself by expecting two cups this year i don't think enough data to expect two cuts. >> we have seen volatility remain pretty steady the last couple of weeks. is that a concern that the news is coming out this weekend >> it's creating a bulge in terms of expected volatility around those date. i think that is the reason that the volatility index remains sticky near 16 s&p the same level it was in april when at 13 in the bigs and in september when you were similarly low. it does seem as if there is an event risk getting priced and you can see it graphically that if you slice the future into what they expect a move, the

vick so to speak to friday to monday is around 24. right? that is where -- i feel like getting past it is the entire issue. then maybe the market can relax a little bit but we will probably chop until the end of july. >> this is it, man. >> we now have vix by the day and can say people are really confident tuesday but monday, they are terrified if they can just get through monday. >> don't forget friday. >> when you is disaggregate the on paper risk, right you can theoretic trade it and price it doesn't mean that everybody is right. >> if we get some sort of truce and hold off on the extra tariffs, where do you want to be in this market >> first thing don't fake you have an edge on whatever happened close that saying. second thing constantly you need to re-evaluate if a worst-case scenario happens to have so much exposure that

it's going to cause me to do something i shouldn't do in the short term to feel relief. if you're going these big bad events that way, then you're misallocated and maybe need some help i will say there is a lot of risk offsetting happening away from the vix and a lot of new products in the marketplace these days, etfs are a good example where there might be some things happening people try to take off risk and that does not show up in the options flow and i think that is an important consideration as well. yet another catalyst the good thing about trump is even if he doesn't get a good result, he could tweet that he did and the markets sometimes take that and they say, thank goodness, everything is calm and cool. >> semiconductors and industrials? what is the most sensitive >> i don't think people should be trying to figure that out two days before something that might nobody be a nonevent if it is, how do you know? >> i spoke earlier to james coleman and here is what he had

to say about the u.s./china trade war. >> this is going on i think for decades. this a resetting of china with all of its trading partners. so this is not something that is going to be sold by a meeting with president xi and president trump at the g-20 meeting. >> that was james gorman he said this trade war will go on for a decade but at the same time, he was bliullish about the u.s. economy. >> we certainly don't expect anything monumental out of this weekend. i don't think the market expects anything monumental. by the end of the year, we examine there to be some deal but not the finished result and a lot we are after and i think parts of that statement were very well said that we are talking about the two largest economies in the world trying to reset their trade balance and trying to reset their trade relationship that is going to take a while. i don't know if it will take a decade but i'm confident saying it will still take two to five

years. >> you think it's more likely to see central bank action abroad >> yes europe, asia, japan are much more exposed to trade and a slow down in gobel trade than we are so it's hurting their economies first and they started on a weaker foot so we will see central banks around the globe ease policy. that doesn't mean the fed won't ease policy but i think we will see other agencies do it first. >> make their stock markets more attractive than ours >> i don't think it does i think it provides a floor and make sure they will not going to fall much further. >> might change your discussion point earlier we might see stock to dollar low? >> sure. i do think it make international markets more attractive. not because of the trade sh. i think there have been ten different reasons to discount stocks relatively to history and at this point, we are at multidecade differentials in performance, in price to various multiples.

at a certain point, the rubber band snaps and people say, yes, i get that the u.s. is a better house than these other houses. i don't care there is higher dividends being paid overseas. there more of a chance to upward appreciation and more chance for multiple -- all i say the more stretched it gets, the better your odds of being there for that moment. i do think international markets, the trade issue just another thing to throw on the pile because you're right. they are more sensitive to trade. but it's just a better buy at a certain point and when that happens, i don't know. so that is why you continue to accumulate. >> boeing weighing down the dow today. now the aerospace giant may not have a fix for its 736 max jets ready until september. that news just breaking. joining us on the phone is sheila who covers the stock. what is the implication of the

stock for this new news they are not fixing until september >> boeing i should an ak last night basically talking about the faa's request to address some of these changes on the max. now we are getting the headline saying it could take up to three months we have removed any delivers until october. you would think after that time when the fix is in place, you're going to need the secondary fix which is more training and simulator -- in simulator training so potentially, you know, this could remove maxes and stagger how the delivery re-entry to the service takes place. >> finish your point sorry. >> i think that is why you haven't seen the stocks too much as they are viewing this at a 2019 issue and not impacting what happens to 2020 or 2021. >> how damaging is this faa or

boeing or both this plane was approved to fly in the first place? and also a crucial five day period when it wasn't grounded as quickly as it could have been >> i think there is just a lot of scrutiny on the aircraft. i believe that the faa and european authority was in the simulators looking at the software change as of late that boeing submitted and worked on the last eight months. the air show last week is potentially more of a convergence of the regulators coming together and you saw that partially with the press release last night which is the international association of airlines asking for regulators to all work together so public has confidence in flying this aircraft. >> so you've caught your earnings forecast. is it a risk going even further, given some of the latest >> i think in terms of the max, it's just a movement of timing

what we did to our earnings forecast, you know, we took more of a cash hit because, obviously, airlines like american, united, and southwest might push out from september to october cancellations so we have to lease 737 that is what i would extrapolate as time goes forward. >> sheila kahyaoglu thank you. up next we are gearing up for nike earnings. they are set to report quarterly results any minute and we will bring you the numbers and instant analysis and reaction after the quick break. stress test results on deck also -driverless cars... -all ground personnel... ...or trips to mars. $4.95.

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welcome back today's biggest move frank holland is standing by let's start with you, bob

pisani. >> a nice move up considering the china deal steady the last couple of days and move nike. goldman on the up side pfizer up and down down in may. big up in june generally up for the quarter boeing cost the dow 70 points. we would have been up 60 if it wasn't for boeing. there is the down side and 737 and now talking about isn't time frame. >> bob, thank you. nasdaq for the biggest movers there with frank holland. >> each after closing ehigher today the nasdaq on pace for first negative but best first half since 2003. so good and bad there. chip and text stocks rallying and optimism over a trade deal retail took a hit. ross downgraded by goldman sacks

and dollar tree is also down and despite that on the mitchell cisco is the worst performer back to you. >> we are awaiting numbers ahead of those we are joined by two guests liz and sam. liz, just before we -- >> we are just getting them. i'll tell you the top and bottom lines of what we have and then we go through and make sure. looks like a miss. 62 cents a share earnings estimates were calling for 66 cents a share a rare earnings miss for nike revenues up 10.2 billion, was pretty much a match. 4% revenue growth and 10% revenue growth looks better if you take out the currency impact and i'll continue digging through. i will bring you more. 20 of the to last quarters nike has beaten earnings per share

expectations this is on the surface mix and i'll dig through and get you more. >> liz, the setup for this particular quarter waunt too tough. >> it didn't seem expectations were too terrible but they were a little bit too high. i think the stock where it is it makes it tough to perform particularly on earnings people are looking for validation of the rewriting that the stock has had over the last several years. certainly from the headline numbers it looks like that might not match up for this quarter particularly. >> samuel, your first reaction well, i mean, the numbers miss it looks like it was on the gross margin the north american business was better than expected and china remained up 24% on the currency neutral basis. looks like things are pretty strong i didn't look at the -- >> gross margins 45.5% and estimate was 45.6% pretty much in line. i think psychologically that 24% growth in china is important to see if they could keep that up in this kind of environment where china is slowing and the

nationalistic attitudes are picking up north america you say was in line >> was at 7% and they were looking for 3.5. that was significantly better. looks like they were spending more money on future growth and they tend to do that and it tends to pay off over time we will hear from them in about 45 minutes. >> overhead expense unfortunate 12% every year so that is obviously revenue is growing so could account for some of that. >> in terms of what to expect clearly pretty much affected by the trade war with china on the supply and demand side what are you looking to hear on that >> i think people will be interested in their comments obviously about a quarter of their business sourced out of china and sam has doing some interesting work i think on how much of that comes to the u.s. and at least if i can believe sam' work, it's less than people think.

so not a whole lot of that is coming to the u.s. so there shouldn't be as much pressure but i'm sure people will be very interested what they have to say. >> i think they have to quantify it or give us something. last quarter it was before the war of words heated up between the u.s. and china and we got that threatened next 300 billion dollars worth of tariffs do you expect them to lay this out and what it could do to margins and consumer prices? >> yes but i did not think it will directly affect nike as much as it does if it happens. nike we think is out of china and bringing in about 10% of the product and most of the equipment and a little bit of footwear since they have such a global exposure, they can balance the prices the problem is that if prices go up and this tariff hits everybody will be impacted and then people will have less disposable income and bigger for nike but that is not yu for them but it's everybody. >> in case you're wondering 10%

currency neutral growth for nike was a miss on the bottom line maybe that the stock under pressure it's healthy growth across the board. north america growth 7% and europe growth 11% and taken a share from adidas, its home market china market up 24% and continues to power this company's growth in asia pacific and latin america up 13% so there is no real weak spot in terms of the geography gross margins continue to go up. liz, i think that has to do with the innovation story at nike and digital story that a lot of the bulls you analysts and i say you analysts because it's 80% buy onel stocon this stock that you are excited about. >> they are executing innovation and digital and international gron growth and china growth is impressive whether or not the stock goes up it's difficult when a stock is

rerating like nike has there is a lot of volatility around the quarters because people are looking for that ah-ha moment where it comes together the reality they have been putting up singles and doubles every quarter and over the long-term term has led to the higher valuation. >> sam, what is your recommendation >> we have a positive rating on the stock. >> i love it. >> i love it i'm wearing a pair of nikes right now. they have control and investing in the future all the time as i've said before this is one of the best grassroots marketing companies ever seen for its size they get down to, you know, was you want in your neighborhood and what sarah wants in hearr's and it's clearly paying off in the share they are taking and we will hear what they have to say for official full year 20 guidance in a little while. >> it seems like it was a story

on the miss. higher costs and stronger dollar liz dunn and sam poser, thank you for being here help break it down in real-time. ahead the fudge factor one indicator could show whether we are heading to a rate cut we break it down in the charts later. >> the fresh uncertainty surrounding the boeing 737 max stay with us

they usually prevail look at this employment trend. month employment growth. this is the current situation. flat not declining at all that was declining, that was declining and so was that. but not 1998 but world markets were in turmoil. the fed has to rate a base cut on the premises besiding weakening. that's why even with employment strong before next week's number we are probably still on track for a july rate cut. >> it needs a triple mandate or quadruple mandate? >> that could be other factors in there. >> mike, thank you courtney, time for a news

update. house speaker nancy pelosi agreed to pass the senate's board aid bill without restrictions it was a sgetback for her presidents and other world leaders who use twitter to threaten or abuse others could find their tweets slapped with warning labels the new policy comes amid complaints from activists who say president trump has gotten a free pass from twitter to attack his enemies in ways that could lead to violence. former secretary of state rex tillerson telling chronic diplomacy was being conducted behind his back when he was in the trump administration he says he happened to be dining in the same restaurant while jared kushner and mexico's foreign secretary were having a private meal. amazon is partnering with rite aid to add 1300 package location pickups mozambique is cutting deals with major retailers to address what has become a priority in the retail sector.

convenience for customers. that is the cnbc news update back to you. >> thanks. we have the stress test results when we come back. -driverless cars... -all ground personnel... ...or trips to mars. $4.95. delivery drones or the latest phones. $4.95. no matter what you trade, at fidelity it's just $4.95 per online u.s. equity trade.

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welcome back we are awaiting results of the second round of the fed stress test the c-card and capital return plans. banks got past last week's stress test fairly comfortably and last week apply to the fed to request how much capital they can return and both buy backs and dividends. leslie has results for us. >> the fed has not objected to the capital plans of any of the 18 firms it tested now banks are able to move forward with returning capital to their investors but credit suisse unit was flagged for weaknesses in its processes and required to maintain payouts from last year's level until it addresses the fed's identified weaknesses by october 27th. the fed gave their u.s. unit which is nonobjectionable to his

plan to no pass or fail and the fed described its rational for credit suisse having, quote, identified weaknesses in the assumptions yued by the firm to project stress trading losses that raise concerns about the firm's capital adequacy and capital planning process jpmorgan and capital one adjusted their plans compared to earlier submissions that put them below the required minimum and had to tweak them accordingly. this is the second time all of the banks objected to the stress test have passed the first being in 2017. du bois? >> leslie, thanks very much for that last year, we did get two u.s. banks getting that middle ground result and that was morgan stanley and goldman sachs partly because of the tax reform bill which put them under more pressure but not happened this year, so the headline being the big u.s. banks have passed interesting that j.p. morgan had

to tweak their capital return plans a little bit the next question is how much they have requested and usually released over night and could be any minute and banks say this is how much will be returning a reminder we do have a chart on this the estimates beforehand before barclay how much the big six could return as much as 17% cash back yield for wells fargo very high we learn overnight how much those banks will be returning to the shareholders. >> i guess we expect a wave of buy backs and dividends? >> a wave of buy backs and dividends. if you put the two extremes in terms of their price, jpmorgan toward the top do we see a breakdown? i guess a lot of total return tilt toward buy back suggest they think our stock is cheap

and jpmorgan -- >> it works very well when you do that. >> exactly i think that kind of balance could be interesting tom brown is with us and thank you both for joining us. jared, what is your immediate reaction >> the reaction is that it's one of expectations. they met our expectations, all of the banks passing the real key will be how much did they give back we anticipate many of these banks will give back at least 100% of earnings, in some cases, even more than earnings because these banks are so well capitalized. as you guys pointed out, the majority of the cash return or capital return will come in share repurchases. we expect difficult pay-out ratios around 30% to 40% of earnings and maybe north of 40% of earnings down the road. >> i think the other key, did this move the stocks financials had a good day today. in general, they have underperformed

james gorman said he is frustrated with the valuation that they are undervalued. ks he would say that still, does this perk up the banks? >> i think over time it will will it immediately perk them up meaning tomorrow it's hard to say i would suggest this our biggest banks are being turned into financial utilities and that is not a bad definition for our largest banks. they are going to be steady returners of capital and our biggest banks will give back on a normalized basis from 75% of earnings efficient year because the banks generate so much in earnings they can't use it all for organic growth therefore, they have to give it back to shareholders. >> tom, what is your take on the fact that capital one and jpmorgan had to tweak how much they are asking to return? >> the cart business is tough for both of them the stress test really is punitive to companies with large credit card operations i wouldn't make too much of it

the point is the four largest banks in this country have been among the ten largest share repurchases over the last year i think you can look for them to be among the top ten again in terms of sharing purchases. >> in terms of the balance that we likely to see, tom, between buy-backs and dividends, do you think it will continue to be tilted towards buy-backs and any of the stocks do you think should be tilting more towards dividends based on valuations? >> i do think because of the regulatory story you'll see the biggest banks limit their pay-out ratios of dividend pay-out ratio less than 50%. the ones -- one number i'm looking forward to the most coming up will be how much does bank america raise its cash dividend and i would anticipate probably 33% increase from 60 to 80 cents. >> let's go back to leslie

picker who is digging through details. >> we have gotten plans for four banks out of the 18 that were stress test about their capital return plans jpmorgan chase announcing it plans to raise its dividend by 13% to 90 cents a share. it also announced a 29.4 billion dollar buy-back. remember, jpmorgan one of the two banks that had to adjust their plans to meet that minimum stress hold. state street to 52 cents a share and 2 billion buy-back and bank of new york melon raising difficult by 11% to 31 cents a share and announcing a 3.9 billion dollar buy-back. we are looking at u.s. bank corps which raised dividend by 14% and announcing a 3 billion dollar buy-back. back to you. >> leslie, thanks. jpmorgan chase trading higher 1% in after hours trading i would point out the big six banks jpmorgan lagged a little bit but not a ground breaking move either way.

>> as a quick benchmark. it brings jpmorgan's dividend yield under 3% that is going to be the benefit if you are owning it for yield, this, obviously, is going to accelerate with the dividend increases what otherwise would have been and the reason -- i do think that it certainly is validating, to some degree, the thesis for owning them on a value basis. though i do wonder what it says that they have already been such aggressive buyers of their own stock and not necessarily led -- >> more persistent worries about low interest rates. >> the other way of saying it, if they put it all through a dividend and a yield of 14% for citigroup would that be more of a trigger. >> that would be massively tax insef and some would not like it it would bring it into sharp relief. >> you said they didn't have political pressure right now which is true technology and health care. i just wonder if this is a new

talking point for the likes of elizabeth warren we just got approval ten years since the crisis where all of these shareholders -- >> i agree the question i said to gorman was boifed based on last nights debate billions of dollars they can jump on the headlines. maybe tonight it will flip the other way. >> i doubt they go let the news that quickly but whoever knows thank you, gentlemen a news alert on pfizer here are the details. >> scott gottlieb is joining pfizer board of directors and previously he was a commissioner of the fda from 2017 to 2019 where he fought to lower drug prices pfizer executive chairman ian reed in a statement says scott's expertise and health care and public policy and the industry will be an asset to our company. stock not really reacting in after hours of trade, though back to you.

>> thank you still hid, boeing software setback. shares pressure uncertainty wl lkbos new 737 max. weilta aut that next to a single defining moment... ...when a plan stops being a plan and gets set into motion. today's merrill can help you get there with the people, tools, and personalized advice to help turn your ambitions into action. what would you like the power to do?

the latest stress test results trickling out. more difficult hikes by banks. leslie picker has more news. >> wells fargo to raise their

dividend by 13% to 51 cents a share and announcing a 23.1 billion dollar buy-back. morgan stanley raising its dividend by 17% to 35 cents a share and 6 billion dollar buy-back citigroup raising dividend by 13% to zcents a share and announcing a 21.5 billion dollar buy-back guys >> thanks for that i think we also are getting the goldman sachs one crossing as well relative to expectation their capital return is ahead of where people thought 8.8 billion versus 6.3 billion last year but expectations this year for 6.7 it is a couple of billion ahead of expectation most of that going to 7 billion buy-back and 7.81 billion in dividend and dividend kind of a little bit more in line where some of the other have been over last year or two not seeing a big reaction there in the share price. >> close to 10% of the market

cap two the buy-back. >> difficulty for the quarter coming up is quite big and i don't know if they will see people rush in to get it on that timing. >> they are all up after hours to your point, nothing explosive. >> it's all kind of confirmation what you're hoping for it's optimistic and positive so we are getting nice 1% in the sector as opposed to make or break moves for any of the stocks boeing taking a leg lower into the close on news it could need up to three months to fix the latest 737 max issue follows southwest today pushing back the return of the 737 max october 1st. >> gordon bethune is a former continental airlines chairman and ceo. what does this latest news mean for airlines that use the 737 max? >> it is a disappointment.

they are route plan-- there wile a revenue impact to every airline that operates a 737. >> gordon, these delays how does it get into the psyche of the consumer typically we wouldn't even know what -- who made the plane we are getting on let alone the make or the model. more news and new headlines and 737 max is a negative label do you think it will stop consumers wanting to fly on the plane? >> maybe initially but the memory is really short and they have a deep history of safety behind them and thousands of airplanes fligs right now today. they will get it fixed the old days they if a date boeing i ain't going and people rely on that name and i think it will come back. >> what do you make between the relationship between ffa and boeing a lot of scrutiny and questions. think how cozy that relationship got and how the faa is treating

boeing to this point. >> obviously, they are being very thorough and going to dot every i and cross every t but, at the same time, they have a long and established relationship it's in boeing's best interests to get along with the faa, obviously. quite frankly, it's in boeing's interest to have reliable airplanes which they have more than a hundred years i don't see anything negative about that i think everybody is being very thorough in what they do. >> to what extent do you feel that overnight the faa or boeing was pressured by the international airlines association as opposed to making these decisions themselves are they once again being a little bit too lax on the issue? >> i'm not sure that they are. i know that it was an unusual event but, at the same time, i think it was the correct thing to do and boeing did do it but there is plenty of pressure on boeing, as you can see just from the market forces

but their bench is so deep and talented, this airplane is going to be around 25 years and a great airplane but having some difficulty teething problems which is causing everybody a lot of -- costing a lot of money. >> gordon, just want to end with this we got word that as of this week, united continental corporate change name to united airlines holdings. i wanted to know how you felt about that as the former ceo of could nntinenta continental. >> i'm sure they gratuitously upset a lot of people but i'm not sure what they got out of. everybody has a chance to fly an airplane i had my turn and it will be somebody else's and they can do what they want. >> gordon bethune, thank you for joining us. >> thank you. the first of two democratic debates wrapping up last night with candidates slashing over health care. we will preview what we cahin t in the next round coming up after the break. research. yep, td ameritrade's got that.

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welcome back bank of america just raising its dividend back to leslie picker for the numbers. >> it's a high five up 20% to 18 cents a share and biggest buy-back we have seen so far today. 30.9 billion dollars for their buy-back we also got results from capital one which is not changing its dividend and keeping it at 40% a share but announced 2.2 billion dollar buy-back. back to you. a couple of extra points on this first to your point, sarah the political attention wells fargo is buying back -- >> you know elizabeth warren is focused on that.

>> i imagine we will see tweets on that. go back to jpmorgan who did have to use their mulligan and asked to return too much initially and fed says no so they came back with another offer interesting for the bank we -- gets talked about often is on the balance sheet. last week the stress test with all of the other banks but spin it one way let's test the water. >> stretch we think we have that. >> at the might as well push it or return as much as we can or maybe not as strong -- >> or under the circumstances of the stress test where you're saying 5% decline gdp. >> of course. >> these were the toughest yet >> exactly 72,000 pages morgan stanley submission was lots of ink and paper. >> and compliance officers up next, your wall street look ahead key things every investor needs to have on their radar as we head into a new trading day. friday, last day of the first half of the month and the quarter.

>> take a y daoff. >> i'm here tomorrow. >> excellent >> we will be right back so, every day, we put our latest technology and unrivaled network to work. the united states postal service makes more e-commerce deliveries to homes than anyone else in the country.

we have got breaking news right now on apple josh lipton with the details josh >> yes sarah, this is a big headline

out of apple that apple has just announcing that sir johnny apple's chief design officer will depart the company as an employee they say that is going to happen larts this year. they are saying an independent design company will then count the iphone maker among its primary clients while he pursues personal projects, apple saying joni ive will continue to work closely on projects. they say evans hankie vice president of industrial design and justin dye will report to chuck jeff williams as apple's number two apple's coo in statement here apple ceo tim cook saying jony is a figure designer in the design world and his design cannot be overstated from 1998 imac to the iphone and

he is putting so much of his energy and care. apple will continue to benefit from jony's talents by working with him on exclusive projects going forward. big news here in cousan francis area joni ive will depart apple later this year. >> not only the high profile management departure of recent months what is going on there a power struggle is it or what >> you look at that core group i would point out a lot of those guys, it's tim cook, jeff williams, you think of phil shiler and eddie crew. a team of lieutenants who have stayed loyal but certainly this is a big move. jony ive and think of a person who is certainly behind the look and the feel of so many products that we know not just that but as they point out here, also a guy who played

an instrumental role in the 5 billion campus in cupertino and a big shake-up here for the products they have and going forward. >> not just there. wall street is paying attention. 1% move lower in the stock we are seeing not every company where you would see the chief design officer have an impact on the stock. >> not every chief design officer could be worth to the market $9 billion. >> there you go. >> step back a second and say is his departure worth 9 billion dollars in apple's value in terms of the net value of what a future contributions he was going to have? >> a headliner >> i think it's interest the market is clearly in a mood to say what is going on at apple and what does it mean for their priority, their emphasis on new products or whatever it might be. >> in terms of the design the ground breaking designs were the start of his tenure. >> sure. >> the last five years. >> the same people who complained they are losing their

design guy say they haven't innovated a long time. >> we have analyst on the phone. jony ives been with the company since 1992 what does it mean for shareholders >> not a lot because they have been managing this company so well here and they have he they moved in into a chief design officer several years. he is less active in the design. the last couple of years designing apple park, for example. even though he is symbolic for the company, he has been less involved the last few years. >> you see this as a little bit of an overreaction down 1%. 1.3% after hours. >> yeah. i think there is so much value in this beyond, you know, what jony ives current contribution has been i think down 1 p, even that

would an overreaction. i don't want to take anything away he has been iconic for this company a long time but that with more on the iphone and ipad, a lot of the mac products. when you think about this company starting to move towards services, it's just less impactful of some of the harder things he has been doing the last piece i want to kind of impress is apple has managed a huge transition around leadership in the last ten years as well as tim cook has taken the reins. a lot of of it is because apple has a process if place of keeping some of the cultural around innovation in place with the apple university which is like a curriculum essentially that employees go through and so i think that it's a loss for the company but if anybody does a good job of managing through these types of transitions, it's apple and they have been preparing it a long time. >> gene, the fact that the

retail chief also announced her departure earlier this year, those two things together, you don't think are a blow to the quality of the leadership team >> no. i think, you know, there is probably some other factors that played into that and ultimately i think that there is other ways can you look at some of the addition that apple's management team, head of google ai coming over recently and hired some of the top talent back with doug field back from tesla and kind of around the car. so i think these are the type of people that are really defining apple for the future and the people that have left had their impact on the company over the previous decade. >> gene, thanks sgroijoining us josh lipton has more. >> i also gave this exclusive interview for the ft and more what is next for him he tells the ft he is setting up a new venture and creative business he called called love

from apple will be the first client he tells the ft i will not be an apple employee but sir jony saying i will be very involved i hope for many years to come. guys >> josh, thanks for that i'm sure more color to come in the hour ahead we are out of time here. that's it for "closing bell. "fast money" will pick it up right now. breaking news continuing now. after hours apple announcing its design chief, its chief design officer jony ive is leaving that company and stock falling 1% after hours. dannathan, we can kick this around somebody who is a household names. >> steve jobs passing in 2011. i thin