a little easier that way appreciate it. we'll see if they do launch others. >> it's something we'll be watching from here on out for sure. >> lauren thomas for cnbc.com. that does it for the exchange. we'll join tyler and melissa for power lunch that begins now. >> thank you, we'll see you in a moment here's what is new at 2:00 on power lunch. cracks in the global markets are sending shockwaves around the world and sending u.s. stocks lower. we'll go inside the numbers. plus the bond yield blood bath rages on the ten year is heading to all time lows. we'll tell you how bad it could get and later as mortgage rates keep dropping hgtv's mr. flip or flop is here to tell us what it could mean for the housing market power lunch starts right now >> welcome to power lunch. the gang is all here today

melissa, kelly, and yours truly, we're now at session lows as you see right there. the dow off more than 300 points kicking off the week in the red. energy financials the worst today check out the big names falling to fresh lows. trip adviser, macy's, pfizer, kraft-heinz hitting a record low today. >> we begin with the turmoil around the world as the trade war between the u.s. and china rages on escalating tensions in hong kong are adding fuel to the fire aman is live with the latest. >> you get the sense that there's increasing pessimism among some on wall street and at the same time you see this increasing tension in the streets in hong kong over the weekend. >> here's the pessimism piece of this this came in the note from goldman sachs yesterday. they are changing their 4th quarter growth forecast to 1.8%.

that's a modest change to the down side they say it's caused by sentiment and uncertainty. also they say contributing here financial conditions and supply chain disruptions from the on going trade war. that's a little worsening of what they had thought was going to happen. before the election, the president himself said something similar to that now that he thinks that the chinese may be wanting to stall here. we're also getting a statement now from a senior administration official here on the events going on in hong kong. the officials saying as the president had said, this is between hong kong and china with tunsing th the understanding that they're looking for democracy and most people want democracy. the united states urges all sides to refrain from violence so the administration here is sending a signal that they send this very much, the tension in the streets in hong kong as a matter for hong kong and beijing to workout among themselves. the united states here is simply saying that it doesn't want to see any violence in the coming

days, kelly. >> all right thank you very much. >> all right now to the very latest on the growing protests in hong kong and the closure of that city's airports sema is covering that story. this was quite a turn in the past 24 hours. >> probably among the lowest point. thousands of protestors poured into hong kong's international airport overwhelming authority and disrupting travel in and out of the world's third busiest airport. in total, 130 flight cancellations with more expected the shutdown of the airport follows a violent exchange between demon trstrators the demonstrations had begun displaying early signs of terrorism. and footage posted by the unofficial mouth piece the people's daily showing chinese forces assembling in shenzen which is a sign that beijing while reluctant to use force is potentially ready to intervene if protests get worse.

the counsel on foreign relations says the chinese leadership is now fighting a two-front war massive internal social unrest in hong kong and significant external trade pressures, figuring out a peaceful solution likely takes precedence but is certainly one of the greatest tests of president xi's administration to date. >> hong kong could prove to be a major black swan for the market. >> things in hong kong seem to be escalating. the people that are protesting are not backing down the chinese government doesn't seem to be backing down. so if cooler heads don't prevail, it's possible things in hong kong could get very ugly and that's not going to be a positive in terms of negotiating a trade deal it's not going to be a positive at all for the global markets.

>> here to break down an ever growing list of hotspots around the world is michelle. thank you. michelle, i'll start off with you, when steve says things could get a lot uglier, what does that mean the people's liberation army enters the picture. >> he was right. they have. we have seen an escalation in the last 24 hours. one of the female protestors appears she is going to lose an eye because of a rubber bullet that went in and the shutdown of the airport in hong kong is a huge, huge event that happens in paris all the time parisians are used to this this doesn't happen in hong kong and the chinese have also started to rachet up the rhetoric the question is do we see the people's liberation army, the chinese military go in and crush this thing worst case scenario, even though all the betting right now is they would be far more restrained than that and times were different and they wouldn't want to take that black eye on their reputation, but still, how

much can they tolerate dissent in hong kong when they are an authoritarian regime. >> one of the ways things are different now is that everyone has a camera and that information can get transmitted around the world instantly. >> if they start mowing people down, we will see it, right? even if they shutdown the internet, there will be cameras that capture it. we didn't have that kind of imagery at the time. remember the kid standing in front of the tank, that's on everybody's memories who was alive at the time. a lot of these kids weren't. but what else do we -- we still don't know how many people died there, right that much of a mystery i don't think you could do the same thing in hong kong. >> is that enough to peopkeep te people's liberation army at bay or is the threat to the authoritarian regime enough to step in? >> there's a couple of red lines that haven't been crossed yet. one would be if you see the tone

of the protest shade away from responding to this extradition law and really move into a sense of hey, we want greater autonomy or a kind of philosophical turn in the protest i think that would be a red line i think a second red line would be the protests turning violent against the authority. so going in and trashing the administrator's office or really physically attacking police. we haven't seen that yet i think those red lines are out there. and there's another interesting factor that's kind of different than the time and that's taiwan and what's happening in taiwan here you have taiwan 25th, 26th largest economy in the world china would love to overtime asimulate taiwan the taiwanese are watching closely. to all the points made earlier, it's going to be there on full

displ display. china has a very tricky sea passage to navigate through here. >> if there is a crossing of one of those red lines that you just described, admiral, apart from the human toll that it might imply, what would it mean for any possibility of a trade deal between the united states and beijing? >> it would reduce the ability to execute that trade deal >> take it to zero >> i don't think it would take it to zero i think long-term, we're going to get a trade deal. i mean, the imperatives for both xi and trump to do so are actually quite strong. i think, however, that kind of scenario will bring a lot of political baggage with it that will cause pressure on the administration not to deal with the chinese after a really brutal crack down. china knows that so all of that factors into it it's not helpful and here we are in august. people really aren't paying attention yet. i think after labor day, if

these protests continue, it has got to come to a significant inflection point so buckle up >> michelle, i want to ask you about argentina but before we get to that, admiral had mentioned if the protests get a lot more disorderly, even though it seems like things are out of hand, there's actually a tenor of orderliness within it interestingly. >> yeah, so i covered a lot of protests with tear gas in athens so i'm very interested to see how this is all playing out in hong kong and they're showing flags. there's the black flag the flag you don't want to see go up is the black flag. that's where they announce they're going to fire tear gas this is video inside the airport. that's a warning and a whole series of escalation it's a weird sense of --

>> it's almost like curtesy. >> curtesy, exactly. to let people know what's coming. >> exactly, yes. >> and there you can see it. >> switching gears and touching on argentina, this is a major market story that we're seeing play out in the emerging markets. massive declines though as well as the stock market there and in that region. >> if ever you're worried about the world getting quite, don't worry, argentina will blow up again. here we go again so there was a primary election last night and it looks like the leftest candidate if he were to run right now could win in a first round in october the current president is much more orthodox in his -- or at least is said to be much more orthodox in his economics so if he gets back into power there it's just plummeting like crazy. he hadn't been aggressive enough about tackling the country's deficit. so the imf is now deep in this thing.

a big problem. it's limited in it's consequence in terms of who plays in that market it's em traders and people that understand distress. hong kong is of a much bigger situation. especially when it comes to the impact on the relations with the united states and trade. >> final word on that. how much of a missed opportunity is this for argentina to have really righted itself on its feet gotten economically where it needs to be for its future how much of a set back would this be? >> it would be a cyclical step back the history of argentina as was illuded to a moment ago was this awful cycle of good leader, bad leader, terrible leader, okay leader it's a country that ought to work it has enormous natural resources 100 years ago there was an expression in english, to be as rich as an argentine

they have been squandered again and again by bad leadership shifts the one to watch by the way in august is pakistan and india and what's happening in the cashmere pakistan, india, three times in the last four years. nuclear weapons, what could go wrong there. i put that up along side hong kong and along side what's going on at argentina. it's going to be a very happening month in august. >> we'll be watching thank you and thank you to our own michelle. >> we have a news alert on boeing and for that we go to phil in chicago. hi, phil. >> within the last hour steven dixon has been sworn in as the new head of the faa. it happened at a ceremony at the department of transportation in washington dc. and about a minute into basically his acceptance speech, his speech saying what he plans on doing as the head of the faa, this is what he had to say on the boeing 737 max. >> this plane will not fly in commercial service again until i'm completely assured that it

is safe to do so the faa is not following any time line for returning the aircraft to service. >> the last part of that statement may be the most important part in terms of the faa not following a time line. you will hear from boeing executives that they expect this plane to be back in service by the end of the year. that they plan to file for recertification at the end of september. shortly after that they expect it to be recertified by the faa and other regular you lay tors arou -- regulators around the world. while they're looking at this very carefully they're not tied to the time line that you're hearing from boeing. it may be that the faa does not certify it in time for it to be back in service by the end of this year. it's clear from steven dixon's comments that they're going to sit and take a very methodical approach as they have been in terms of what happens next with the 737 max. >> phil, thank you coming up, stocks are sitting near session lows today as global tensions continue to boil

over analyst after analyst is weighing in with warnings and slowing growth we'll tell you how to position yourself ahead plus look out below. the yield could go as low as 1.25%. we'll tell you what that means for stocks, real estate and your money. we'll tell you those stories and a whole lot more coming up on power lunch. and you should be mad at simple things that are unnecessarily complicated. but you're not mad, because you're trading with e*trade, which isn't complicated. their app makes trading quick and simple so you can strike when the time is right. don't get mad, get e*trade and start trading today.

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morgan stanley all out about the cost of a global slow down and the rising threat here in the u.s. bob has more from the floor of the u.s. stock exchange. >> this latest round of tariffs has left wall street dazed and confused because trade concerns are not only weighing on stocks but also on earnings projections. today the weakest sectors are all trade related and banks and retail energy industrials and defensive groups are flat. we've seen this a lot recently 2019 earnings though were looking flattish up until a couple of weeks ago but additional tariffs are starting to impact estimates. so in particular, both are very tied to the global economy look at energy here. it's been coming down fast in the last few weeks these are estimates for the third quarter. it's 21% down from the third quarter from 14% just a few weeks ago. industrials have gone from up 6% a few weeks ago to now up 2% others have been coming down as

well these are specialty retailers that include l brands and gap. earnings for the group as a whole expected to be down slightly that's a big drop for me up nearly 9% projected a few weeks ago. not surprisingly stocks in this sector have been weak to pbh, l brands, gap all down on the quarter. you see how we're sitting lows on the day and moving in lock step with the ten year yield as it moves down, stocks move down back to you. >> thank you very must have. global worries continue to grip wall street. what is still working in this market might be worth a little bit of your money. bill is chief investment officer with avalon advisers and eddie is chief equity investment officer let me begin with you and probe why you like financials in a market where interest rates are falling net margin is probably -- is contracting and the stocks have been under pressure. >> well, we pride ourselves on

being contrarian and looking for a value mispriced by the market. it's so easy to tell the case on the market overall and financials in particular trade is causing fears of recession which is causing interest rates to fall banks make money by borrowing short and lending long which is harder to do when the yield curve is inverted but at some point that will change, at some point these problems will sort themselves out and then there's very good value. they're trading as cheap as they have in a long time versus the broader market so if you're patient and willing to look out beyond the immediate horizon, there's very good value in the financial sector. >> bill, you like industrials but financials are not on your list of favs right now consumer discretionary stocks are. why not financials answer eddie and why consumer? >> well, i think one thing is you're right you have two contrarians here. it's a matter of putting them in order that we like but i don't necessarily disagree with them but the time is right to lean

against kind of the consensus a little bit that's what feeds into the more cyclical areas that we're talking about one is you're seeing the global central banks step in with easing it takes awhile for that to show up i suspect they'll help out his financials and help out the consumer discretionary and industrials as well. >> when you look out a little farther things look brighter to you it is hard to look past some of the things that we were just talking about in the preceding segment, india, cashmere, iran, hong kong, the trouble in italy with the government there. now argentina, the possibility of no trade deal, brexit, there's a lot of stumbling blocks out there. >> yeah. you know, the issue is the market has to eventually price in all the uncertainty but as we

know, really what ends up leading to opportunities is once you get all of that priced in, secondly, you know, once investor sentiment gets negative enough, we have already seen a lot of negative sentiment. i'd say the last piece of the puzzle that people lose track of is there's a lot of dry powder out of there wanting to buy and certainly bonds, you know, yields are falling away so they're going to be looking for some sort of return. money market assets of like over $3.3 trillion. i think you could see a really nice move. >> tie it off here with a final thought. >> i think the one risk out there that does worry me from that long list is hong kong because if it gets in there and it gets bloody that could effect trade talks and impact trade talks and that would be a concern because a lot of the weakness that we're seeing in

the economy is self-inflicted as a result of the trade off. i think that's why they're the place to be. but you have to be willing to buy them forever everybody else does when they're cheap, which is now. >> thank you >> coming up in power lunch, the yield on the ten year note has a lot further to fall. will this race of the bottom mean a big boost for home buying the host of hgtv's flip or flop, tarek el moussa will join us we'll ask him what that means for housing market but perhaps this year, a more exhilarating endeavor awaits. defy the laws of human nature,at the summer of audi sales event. get exceptional offers now.

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european banks at a tipping point as economic fear, rates and political uncertainty in italy and the u.k. spook investors. the group facing a critical test reaching a bottom last reached in 2011 and 2016 can it hold that level they're your trading nation team talk us through these levels that are so significant from 2011 and 2016 and whether you think they can hold this time?

>> all right sure thing, well, the one liner is just continue to stay away from europeans banks now while the representative index is still above it's low from 2011, i think a more recent breach of its low from 2018, december of last year, is marking a potential resumption of europe banks long-term down trend. now while this surely isn't a positive for global risk, over the last ten years the s&p 500 is still up 180% against what has been a 65% clip in europe banks. i don't think the u.s. needs them to work however it does reinforce our view that the u.s. should continue to out perform versus europe and growth should continue to outperform versus value. >> i think, i don't mean to put words in your mouth, but i think you come to the same conclusion but by different means. >> yeah. i think if you look at the fundamentals of what happened in europe after the crisis and for

the last decade versus the u.s., the u.s. was very quick to write down bad debt and recapitalize the banks where as europe tended to have a lot of this bad sovereign debt but left it on the banks as part of the bank capital and that means that the bank themselves are not nearly as strong. now couple that with ultra low interest rates and ultra flat yields you can't get a positive interest rate anywhere beyond less than 20 years and soon you're not going to earn anything on any part of the yield curve at all that's not a great place to be operating as a bank and europe is slowing down. so that comes to the picture where europe doesn't look good i still think the long-term trend is that it's going to be hard for them to make money. >> thank you very much for more trading nation head to our website or follow us on

twitter at trading nation -- i almost said twading nation. >> someone should get that handle now. >> yields are in focus the ten year is going one and a quarter. plus hgtv flip or flop star joins us on set to discuss what falling rates means for the housing market and guess what is going on you might be surprised economic uncertainty is starting to trickle down to main street we'll have the details when power lunch returns. >> and now the latest from trading nation.cnbc.com and a word from our sponsor. i like to refer to it as a gauge of uncertainty while it may imply the market is headed for big moves, those moves could be for the down side or to the upside i'ram ndy frederick and schabb

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the trump administration is making changes to the endangered species act which is credited

for saving the bald eagle and other animals. critics say it greatly weakens the protections making it easier to remove species from the list. it reduces regulatory burdens. flash flooding created a dangerous situation for drivers in the st. louis area leaving several stranded on top of their cars and more rain and thunderstorms are expected throughout the day today co koch is holding a job fair today at its mississippi plant nearly 700 workers were detained across 7 locations the company says it is cooperating with the investigation. >> and a pool is not where you would expect to find a car but that's where one ended up. the driver crashed through a window at a seattle l.a. fitness location three swimmers were in the water at the time but no one including the driver was injured that's the news update this hour guys, i'll send it back to you

melissa. >> thank you want to get a check of the markets right now because as we have seen with so many recent sessions the markets are following the path of the ten year yield just moments ago hitting a session low of 1.645%. so we are seeing the indices hit session lows right now the dow jones industrial average down 351 points or 1%. 28-84 is down 1.2% and the nasdaq is down 1.2% as well. that group is under pressure down 1.6% today. sinking further into correction territory and it's down 14% from the highs. >> we go to rick tracking the action at the cme. hi, rick. >> yes i'll tell you, if you were holding an umbrella for dropping rates thinking that heavy stuff hasn't come down yet, it's raining a lot harder let's look at an august 7th start to tenure. that was the day that we had all the big intraday lows.

159 in the 10, and 211 in the 30 we're getting close. 10s are now down 11 basis points at 164 and if you open the chart up to july, you could see right at fed day the 31st the swoon began. open it up to june of 2016 that was the last double bottom at 136. many people say one in a quarter. you start looking close to that double bottom anything can happen that's supposed to be the breaker for all breakers finally it's a 30 year bond you should pay most attention to it's one basis point, two basis points away now at 12. the all time low you see on this chart and six basis points it's a fresh flat going all the way back to 2007 back to you. >> that's where we're going to pick up. it's going one and a quarter that would be an all time low. it's not a zero though like some

others were saying let's get reaction kevin, i mean, almost nothing sounds extreme anymore we're talking about negative yields there's $60 billion of us. corporate debt already trading at those levels. what happens if we go to one and a quarter? >> i would think if we go to 1.25 where trade deals are off the table. so at that point we're almost recession bound or very close to it but most of the news that we have seen of late just favored the bond market as people exit stocks and go right into bonds. >> i would have thought, sure, that makes sense before we got a month meeting the june data that came out in july for the u.s all better than expected and all pretty strong overall and yet they sank like a stone so they don't seem to be data dependent. >> no, you could almost throw

most of that data out. hopefully this week we'll get a better fresh round of data that may be more current but i can't tell you whether it's the fleaifle fleaing of the he requestequityr them having to be where they think the fed is going to be and how much lower we can go but it certainly is a play of the game that we don't know the rules for right now. >> so i understand that people say, look, compared to the rest of the world, u.s. yield is relatively attractive and that's why we're still seeing buying at these levels and yes, given what the fed is talking about, we could go lower from here if they're already talking or doing more bond buying than we thought, if they're talking about doing more in the future but my question is for investors in fixed income that are looking to these products for security or for retirement or the defensive nature of their portfolios do they need to rethink that right now based on how extreme some of

these levels are getting >> i think they do quality is king here, kelly. i think if you want to stay in the short end of the market, there's still value in the corporate bonds and i'm talking about higher quality corporate bonds versus high yield that will give you a decent resting spot it's not a great yield it does give you a chance to ride this thing out a little bit. if you're a longer term investor, the municipal market at 100% of taxable yields out on a long end gives you not only credit quality but yield as well it's not the prettiest game out there. there are still value proposition for bond investors. >> when i spoke to you last week on squawk box you indicated that you thought the 10 year yield would go there fairly easily do you still see that. i'm just curious is there a time -- its a 24 hour market for treasuries but is there a time of day where you think things will get pushed around more than others? that there's more danger involved >> we haven't seen the stresses yet that might indicate that we're going to kind of on an

elevator shaft down to 135 so ig last week priced a number of deals where spreads were tightened. they were oversubscribed the index in particular has dropped a little bit but not anywhere near where it was at the beginning of the year. so right now, it would take almost a complete give up on the thought that u.s. and china are going to have a trade deal before we kind of cash in on the economy and see yields fall much further than this. we're all adjusting levels down. i'm at 1.5 right now what is to say it could go to 135 or 1.25. >> it sounds more normal than i ever thought it would. thanks so much appreciate it. >> thank you. >> let's go to the oil market which is closing for the day and contessa brewer is at the commodity desk. >> hi there. oil gained back some of the ground that it lost despite fear of a global trade down wti is up almost a half of a

percent. it had a session low but it's bounced back to the flattish mark and the world's largest oil company blamed volatile oil prices for declining profits they held the first ever investor day and revealed that the first half profit had nearly $47 billion but that was down from the 53 billion the first half of 2018 the company also says it is ready for its ipo but that the timing will be determined by the saudi government when market conditions are optimal and we don't know really what that means but they said that's when they'll be ready for it, guys. >> thank you session lows across the board today as the ten year yield falls to the lows of the session. some of the big drivers of today's losses after the break plus, still ahead, tarek e tarek el moussa will join us on the set. will mortgage rates keep falling too? and how big of a boost will this be for housing we will ask. no flipping. power lunch will be right back

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some of the biggest dow losers include pfizer hitting a 52 week low today. the banks are all getting hit because rates keep moving lower and united technology is weighing on the dow. >> we literally breached 1.64% so major moves in the past half hour in terms of the ten year treasury yield and that's bringing stocks lower as you see there. taking a look at the groups under pressure energy retail, semi-conductors and financials feeling the brunt of the pain with rates going down and chip stocks down 1.5% this is something we'll keep watching for you it's been a rough year for the housing market as home prices are down by falling inventory but rates have slipped to the lowest level in nearly three years. will it give a boost to a sluggish housing market. here with us now is the home

flipping guru, the host of flip or flop and the host of the new upcoming series, flipping 101. >> great to have you on set. >> so excited to see you guys. >> the obvious reaction would be falling mortgage rates great for housing. what is the truth here >> we have seen a lot of changes in the market. this year is more than last year i think it is going to increase sales. i don't think the prices are going to go up so much it's going to stimulate the real estate market and really drive sales. >> at the same time, you're also seeing margins compress. the costs are going higher because of the tariffs. >> the tariffs are real so the cost of construction is going up and because i'm spending more money to fix up a house doesn't mean i get to sell it for more so that money is coming out of my profit. >> i'm surprised that home flipping is at a three year low right now. what's been going on all of those factors contributing less profitable? too many people involved >> a lot of people have entered the market they're buying and selling properties but a lot of people

took their homes off the market because they couldn't sell last yearthe market was sluggish and a lot of people lost money trying to flip houses because they didn't have the right education and they went into project they aren't prepared for so today the flippers still in the game know what they're doing. >> where the best flips? are they distress sales? are they foreclosures? do you search for the best flips by neighborhood, by zip code >> that's interesting. for me, i'll say i'll buy real estate anywhere that i can get a deal if you took me anywhere in us and drop me off in a city or town i'm flipping houses foreclosure, off market properties the mls is competitive right now. my specialty is off market deals. >> i've heard that people -- you have people in other countries, certainly other cities who watch these websites just waiting to pounce how has that dynamic changed the market >> it's a competitive world out there. it's a dog eat dog world it's all about supply and demand when you have super high demand

it's going to increase activity on the property. there might be one or two people bidding on the house i've seen it recently as high as 10 or 15 people. i've started to walk away from a lot of the properties and only specialize in finding properties that's not hit the market. >> what's a typical rate of return >> net-net profit of 10 to 12% in 120 days. >> 120 days. >> will you come finish my kitchen renovation please. >> it's still going on. >> it's still going on. >> i'm going to say one thing, when it's your own house, add 5,000 days that's the worst. >> and many thousands of dollars. >> knockoff the rate of return. >> the worst flips i have ever done are any own house every time. >> in this housing environment, who is the winner? renters, buyers? it doesn't sound like it's necessarily flippers or sellers. >> it's still great for flipping i'm flipping close to 30 houses right now. i'm buying a lot of rental properties and the market is great for everybody that is

involved you have super low interest rates. the housing, you know, people need to live people need to rent. people need to buy and because the price has gone up so much, it's created a large demand for rental housing and investors are now capitalizing on buying rental property. so i'm a big believer in buying income producing assets. >> correct me if i'm wrong but a lot of the properties were southern california, orange county, l.a. area, is that still as ripe an area for flipping or has the geographic center of gravity moved somewhere else because the prices there have gone up so much? >> it's a competitor world out there and there are a lot more investors in the hotter market, the l.a., the new york, the san francisco. those are really competitive markets but flipping houses is flipping houses. there are deals everywhere in every city across the nation. >> are you worried now it's going to get way over the top? we haven't even seen the impact now. we're looking today at new lows basically. >> the interest rates are lower than -- i can even remember seeing it. >> but stock market declines is

that a concern in terms of sales? >> absolutely. everything effects something else one thing is doing good, another thing might be effected by it but at the end of the day, the interest rate drop is good people are saving money and they're stimulating the economy and people own houses and that's a great thing. >> tarek thank you >> and as we see the stock market at session lows here, now at 427 points, you want to watch this, stay with us, the next hour is going to be very busy. about 450 was the low now. the 10 year hitting lows of the day. the yields there we're watching the sell off as it accelerates and we'll have more on that after the break plus washington and wall street are notthe only ones sweating the growing trade tensions, tariffs and uncertainty. starting to worry main street as well and we'll tell you what small business owners say about trade, immigration, the economy, that and more straight ahead on power lunch. - [spokesman] if you've tried college but never finished,

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welcome back to "power lunch. right near session lows. in fact, about two points off for the s&p 500. the dow jones industrial average now down about 35 points or 1.7% let's get to bob pisani for more bob? >> we are once again moving

almost in lockstep with the ten-year yield, which is itself sort of a proxy for global growth or lack of global growth along with, of course, oil so we started the day, what, 1.37 on the yield on the ten-year, we're down almost ten basis points, essentially. 1.63 that's a fairly sharp jump to the downside and when you have that happen, we've had it happen the last couple of weeks, the market tends to move down and that's exactly what's been going on typically, you're seeing bank stocks weak here today and a lot of those back stocks are back to the level we saw in march and certainly back in may. not just the big banks like bank of america, but the super regionals like regents and fifth third. all the other groups are trade related. we have some of the transports weak, retail, energy, and industrials also on the downside what you want to watch out for now is not just stocks hitting new lows it's a pretty small list largely energy stocks. what you want to be careful of,

melissa, is the advanced decline line deteriorating how many stocks are moving forward versus declining every day? stha that was at an historic high just about a month ago and over the last week and a half, it's been under some pressure a lot of big technical analysts watch that, because that's the main indication of how well the stock market is doing overall. if is that right that starts ro you'll see a lot of technicians start screaming pretty loudly. back to you. >> bob, thank you very much. small business confidence rose to all-time highs in the first years of the trump administration but confidence has taken a hit over the past few months as worries about the economy trickle down the main street kate rogers joins us now with some numbers kate >> hi, tyler sthae that's right our polls out today for q3 shows a drop of 57 for the confidence number that's tied for the lowest read since q2 of 2017 before tax cuts were first passed. now, a big reason for the drop, trade policy is weighing on the mind of main street.

a record high of about one third of small business owners say that changes in trade policy overall will have a negative effect on their business in the next 12 months that is up from about one quarter in q2. 16% say it will have a positive effect and about half said it will have no impact on their business when asked specifically about china trade, about a quarter said a u.s. trade policy toward china has hurt their business over the past 12 months, while the majority reported no impact. 9% say their business has been helped by u.s. trade policy towards china. it is important to note, though, the survey was conducted prior to president trump's most recent escalations with china and prior to the treasury department declaring that china is a currency manipulator we'll have to watch and see in the next few months or next quarter if those numbers change anymore. >> did they give any context when they say, we're worried about this, we see it as a factor, how much so, how they're responding to that km. >> not so much on that it's certainly starting to show up definitely more so than we've seen in past quarters. we're starting to see it show up

in the nfib data but most important issue for more than half of small business owners in 2020 is president trump, whether he stays or goes. democrats, obviously want to vote him out, republicans want to keep him there. >> i was going to say, high labor costs. >> immigration, jobs, health care, the economy. those are all also important issues, but definitely 2020. >> and all wrapped up in that election, for sure >> thank you, kate rogers. after the break, we'll continue to monitor this sell-off dow is down 432 points we're watching that yield curve very closely for inversion "power lunch" is back in two

welcome back to "power lunch. a dramatic afternoon in the markets right now. check out the spread on the two and ten-year yield i know it's a little funky to look at, but watch the left side of the chart there we're looking to see if this spread goes to zero or below zero it would be the first time in over a zero that that's happened people watch it, of course, as a sign for the economy this is happening as the ten-year yield itself is sinking to session lows. stocks also falling as that happens. jim yurios is with us. what happens if we go to zero or invert here? >> in the past, it's been 14 to 18 months after the inversion of twos to tens that the recession standard starts my contention has been over the last couple of years that with all the central bank involvement that we've seen, that's

distorted the long-end rates across the world $15 trillion of sovereign debt is trading negative, including 50-year bonds out of switzerland. to me, it seems like that's distorted a little bit i'm not saying it's nothing. i'm saying, i don't think it's as huge a deal as it used to be. and the recession could be a long time. as far as the time to panic, it doesn't seem like today is it. >> so if you think that central banks have sort distorted the action in the bond market, then do you think that the ten-year, wherever we drop, do you think that the markets are going lower for no good reason >> yeah. i don't -- i'm not even 100% convinced, by the way, that stocks are getting hit because everybody is flocking to the ten-year i think it starts that way a little bit and both things kind of feed off themselves as soon as the stock starts to gap lower, that accelerates that move into the bonds. but i think that not for no good reason, market position is a strange thing. and every once in a while we have to get slapped in the face to remember what risk is there are real risks last year, we realized that perhaps china's not very willing

to negotiate right now and they want to wait until after the election two, we've seen mobilization in hong kong that's scary we've seen argentinian -- and an argentinian currency crisis happens once every two years, so it's not a huge thing. jim, thanks for your time. and a slap in the face right now is in form of the stock market down by 1.5% or so thanks for watching "power lunch. >> "closing bell" starts right now. stay with us you don't want to miss it. >> welcome to the "closing bell." i'm morgan brennan in for sara eisen at the goldman sachs post here on the floor of the new york stock exchange. that stock is down5% right now financials getting hit the hardest in today's session with the dow down 421 points. the s&p down 41. selling intensifying in just the last few moments key question, with 59 minutes to go, will the selling continue? >> i'm wilfred frost good afternoon to you. stocks selling off protests in hong kong rattle an already tense relationship betweea