this is a stock that i think is overdue to break out, 120 will be your signal that it's time. >> joey. >> hess. >> you want to give me another word on that >> outperformer in the energy space. i like that. >> we'll have to leave it there. "the exchange" begins now. very well done. thank you, scott. hi, everybody. president trump says good things are happening in the trade talks. word is the skinny deal could be on tap. and the market's a believer right now. we're about 90 minutes away from the big meeting between the two countries. can they deliver on this deal? we'll debate that. plus the good vibes are flowing from the shores of the uk today. could a brexit deal get done and how much as this concern been weighing on global markets all that plus roku keeps rocking. how much would you need to be fied give up going and is china ready to make nice with the nba again it's all ahead rapid fire. seema has the numbers today.

>> market hopes building around trade talks that are happening in d.c. take a look at the major averages at this hour. the dow and se&p 500 to snap a three-week losing treek. we're up around 1.5%, best performing sectors industrials and materials as investors keep a close high on those trade talks in d.c., we're now about 2% away from the all-time highs we hit back in july. now, following a very strong session overseas, this really has been a global market rally. we have the shanghai composite, markets in japan closing higher. but on a percentage basis, stocks in europe posting the biggest gains. germany up nearly 3%. ftse up. the notable standouts, industrial and construction supplier reporting earnings that came in much higher than expected. plus it's cfo saying teariffs

will not be a drag. honey wi honeywell is on thursday reporting. with home dee poe and walmart also at highs. apple now up about 15% here in 2019 from the we go. kelly, back to you. >> thanks very much. welcome to the exchange, everyone, i'm kelly evans and trade is where we begin with hopes up on the possibility of a skinny deal, so-called, with china. what would that deal actually look like? kala is live at the white house with more. >> reporter: talks broke just about an hour ago between china and the u.s. just a few blocks away at the office of the u.s. trade representatives. some of the action items that have been on the table have been a currency pledge under way for a few months. more market options by china, and limiting the requirement for chinese investors to participate in these joint ventures. and also some potential waivers for u.s. suppliers do business

with huawei. in the past the president has taken issue with a skinny deal, interim dealer wants to be seen as pushing for this broader comprehensive deal. so that end, even earlier today he was tweeting about one of the great things about the china deal is the fact that for various reasons we don't have to go through the very long and politically complex congressional approval process. when the deal is fully negotiated i stein myseign it mn behalf our country fast and clean. there's no expectation that that larger deal with signed today. but the fact that china has been announcing agricultural purchases, some of this is seen by the u.s. side as good-will measures, steps in the right direction and that should, in turn, lead to the u.s. to call off that october 15th tariff hike. >> kala, let's look at those action items one more time. which included the huawei, ag

purchases, couple other areas as well. what is the significance of saying, no, no, this is not a mini deal, a skinny deal, these are just action items, so-called? what are they trying to accomplish with that language? >> to prove that there is enough progress being made that a detente is warranted that the stage in the game. so when democrats in the field running against president trump in 2020, which they try to call him week on china, he can say, no, no, not only did we secure these wins, but we also kept negotiations on the harder issues open. we still have tariffs on the majority of goods coming in from china and we're still holding them to account. >> interesting. >> that's the purpose of the marketing here. >> so we might not hear this administration refer to it as a deal in any sense like that. they simply almost want to say, hey, these are the concessions we've already won and we're still working on the big one >> correct, kelly.

but there is some handering between the weakening economic data and also the political environment, the headline risk that's been coming in the last few weeks for the white house. in the words of one white house staffer, we need this good news. >> all right, kala, appreciate it. let's talk more about how meaningful a deal or action items like these would be with our trade panel. joining me now are patrick who is managing director. and riley walters is policy analyst for asia economy and technology at the heritage foundation. welcome, everybody. patrick, what do you think about callg esaction items and how well do you think this will go over with the u.s. public even if they're agreed to this afternoon? >> so there's so much speculation going on about what might or might not be agreed to. i think we just have to wait and see what, number one, the announcement is and then wait about two weeks to see whether

that holds together or not. because we've had times in the past where it hasn't held together and we've gone right back where we were with no agreement. for investors i think there are two things to keep in mind. the first is that the chinese economy is slowing and it's slowing for reasons that predate the trade war. and will continue to slow with or without a trade deal. so that's an important thing. and the second is that the u.s. and china appear to be on a collision course on a host other issues. even if they solve -- even the kind of action items that you're talking about, i think there are still going to be events that rattle markets, that have to do with continuing u.s./china tensions, not just related to trade, but security and other things. >> oh, for sure. absolutely. and meredith and riley, you guys differ a bit on whether the tariffs are likely to go into effect next week. meredith, you think th're probably likely to be postponed. how long does it matter and then what about the december 15th round that sounds like it

would still be planned. >> yeah. really the key here is that any truce that we're likely to cecum out of this afternoon's talks, it's fragile and it's not a break-through in substance at all. it's a sign that both sides are lacking for a temporary truce. but the political incentives to make the harder concessions to get to a broader trade deal, we just don't see that coming anytime soon. so short-term gain, but over the long term the relationship between the two largest economies will still remain rocky. >> meredith, which of the following action items is the biggest win for the u.s., if china agrees to it, if any of them you think are that significant. the huawei waivers, the ag purchases, you know, currency manipulation, chinese market openings which of these says, wow, look what we got accomplished here? >> not much says wow because none of these action items are structural in nature in getting to the 301 concerns that the trump administration has raised with china.

so, look, we're likely to see a delay in the tariff negotiations. we might actually even see a slight rollback. i'm hearing from chinese negotiators that they have dropped their asks for a full rollback of u.s. tariffs and would be happy to settle for a slight rollback of tariffs. but fundamentally here, until those structural issues are addressed, most of those tariffs against chinese products coming into the u.s. are likely to remain in place. >> okay. and, riley, you seem to think it's more likely than not that the tariffs will still go into effect maybe as soon as next week. why is that? >> i'm pretty pessimistic on these talks. honestly, we've had two years of this now and we have these occasionally truces every now and then. but at the end of the day, i mean, we usually have tariffs coming back on eventually anyways, which is a problem in itself. we could have a truce, i'm not saying that it's not impossible. i'm just a little bit more

pessimistic around either a truce or a small deal. so next week i think we do see the tariffs coming about. it is pretty marginal compared to the tariffs we saw in september or the tariffs that we will see in december. but we also have some other interesting things too is, you know, next week china's going to release their new gdp numbers and those could be another thing we're talking about in a week, another factor that contributes to whether they decide to continue the trade war or not. >> and we're always trying to figure out what the gdp really is and what it's reported as and so forth. >> yeah. >> patrick, steve bannon was on this morning and when asked what has the white house really won here, his take on it was the following. take a quick listen. >> china is hurting so much by these tariffs and what they're trying to do is anything possible to get president trump, i think, to delay or nullify the october tariffs. >> in other words, he says the tariffs, patrick, got china to the negotiating table and that

itself is a win. do you agree on that what would happen if we didn't have them here to make a deal, so to speak? >> i think that there would be a lot of other paths that the united states could have taken to get to a substantive conversation with china. i don't think this is the only one. i know that, you know, they want to claim that because they want to show that this is putting a lot of pressure on china. the u.s. economy is also feeling some pressure here. you know, what i heard from your other guests is that regardless of what happens today, there's going to be continuing uncertainty about tariffs and a lot of tariffs are going to remain in place. if you look at the surveys of businesses and both manufacturing and nonmanufacturing, but particularly manufacturing, which is now in contraction in the united states. >> right. >> it's one of the things that has really weighed on businesses. not so much consumer sentiment yesterd yet, that's been strong. but on business sentiment and they're concerned not just about the impact of tariffs that are already in place, but the possibility of others. >> yeah. and so what i take from this

whole discussion is that you guys are at best short-term optimistic but everybody long term seems to be quite down beat on what's really been accomplished here. and maybe the fact that the u.s./china relationship looks like it just could continue to get worse. with all that said, we'll see what comes about in an hour and a half or so. thank you very much. appreciate it, everybody. patrick, may turning to purdue pharma, they are appearing in bankruptcy court today pushing to freeze all litigation as it pursues a larger settlement. there are about two dozen states who don't want this to happen. meg has been following this from the beginning. what are ayou hearing? >> reporter: i just came from an incredibly packed courtroom where theres with dozens of lawyers arguing all different sides of this case to the sack letter farm family who owns purdue pharma to the different states with different views. a purdue lawyer stood up in court and called this a, quote,

chaotic vortex of lawsuits they are asking for those lawsuits against them, more than 2,000, to be stapd as thyed as to get more support. some people have signed on and others they're not agreeing with. another settlement they put on the table they say is worth 10 building dolla billion dollars if the would turn the company into a public trust using the assets to help the opioid crisis, both cash and opioid reversal drugs. the sack letter themselves would contribute at least $3 billion. but at least 24 states and the district of columbia have opposed this stay of litigation. these are the arguments that are going on in the courthouse behind me right now. they want to be able to continue with their lawsuits against the company, many of witch are comi which are coming up early next year. >> so the judge here, could this

effectively decide the issue as to whether this settlement comes the one that applies for purdue across the board in dooi dealing with the opioid crisis, if they find this is an appropriate way to deal with it. >> reporter: what he will decide today is whether there will be a stay of litigation so the sides can work toward a settlement. it doesn't mean that the settlement will necessarily be accepted, it will give them more time when there aren't a lot of lawsuits swirling around them to come to the table. we'll see if that ends up working. half the states don't want this settlement. >> thanks very much. and here's what else is ahead today on "the exchange." >> coming up, markets rallying on hopes of a trade deal. but are investors getting ahead of themselves? plus, signs of hope across the bond with a brexit deal back in play. and, 15 seconds of fame that could make a chinese bc billions. that's all ahead on "the exchange."

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welcome back to the exchange. we're all over this market rally today. the dow was up 500 points. we're hanging on to about a 360 point gain, that's 1.4%. s&p, nasdaq and all of the

markets are within reach of their all-time highs. less than 2% away for the dow and s&p. it's not stirring up much excitement. quite the opposite. the latest aaii sentiment survey shows optimism dropping to a 3 1/2 year low and nearly half of investors are bearish expecting stock prices to decline over the next six months. we have the chief investment officers at federated investors. and michelle mckinnon is here with us. so, steve, do you take this as a contrarian side? it's pretty shocking that you could say we're at all-time high so people are getting cautious. but they've been cautious and bearish for a long time now. >> we think the setup going into the fourth quarter is. >> everyone remembers the last fourth kwhaert wquarter, which s terrible. so we've had nothing but good news this week between the fed going to steepening the curve and really qe light effectively.

ec minutes looking dove inn. we've been saying we think the manufacturing psych is bottom here. ism index started turning down 11 months ago. manufacturing cycles have a waive workiway of working themselves out as inventories adjust. germany will be giving us numbers next month. that's working. the trade news. we just get less worse, that seems where we are right now. >> less worse. >> the setup looks very good and i love the sentiment being negative. i think that's a good sentiment. >> we have bearish sentiment is 44%, michelle, of respondents. so people hate the stock market right now. >> people have hated this bull market since its infancy. think that's extremely positive and i agree with you that as long as we can keep sentiment low i think there's absolutely upside in the markets. it would be more alarming if

people were extremely optimistic, especially with the headlines. there's some negative headlines happening and i think if investors were turning away from that i would be more concerned. >> we know how long it's been, a decade plus and everybody's looking for the late cycle signs. ipo frenzy when we had earlier in the year, well, not so much now that we've seen some of the high-profile stum blers out of the block. there's not a stun of deal activity this year for example. how would you position people, michelle, for this kind of environment? >> in terms of the ipo market think there that's positive that the public markets are penalizing those that don't have revenue and saying to the private markets, you probably need to correct your valuations. so i would be more concerned if the public markets just continue to be favor those that didn't have growth or didn't have profitable growth. in terms of positioning, i think it depends on your time horizon. i certainly wouldn't shy away from the bond market if you do have a short-term time horizon because it's important to have that fixed income component. and i will say this.

if we do get some type of trade resolution, i think the foreign markets are probably more ripe to move higher here because they have absolutely been hit by this trade war. >> yeah. >> and they have lower valuations than we do. >> although, steve, the u.s. numbers and companies and the fastenal point is an excellent one, look really strong, certainly relative to what people were bracing for. >> yeah. >> and if the cycle's turning, as you say. >> i would say you want to stay over equities here. we kept our 3,100 target on the s&p i think we'll blow through it through the end of the year. i think the market moves higher from here to the end of the year. it's going to be through the cyclical side of the market, that's where the news is getting much worse quickly. the industrials, financials, the material stocks rallying today. but longer term we like the whole broad sector of the equity market. i agree with you, michelle, there's value internationally. it just has less of the big tech names that you probably want to own on a longer term view.

so i wouldn't give up on the u.s. market here quite yet. we haven't really loaded up on international. we're a little bit more than positive. >> you can do fine here. >> there's room there, but there's plenty to do in the u.s. >> all right. >> don't you think if we see significant slowdown in the united states, that's just coming to trend growth, that investors will eventually reward those that have much more substantial grorwth than they do here in the united states? >> we're not calling for a slowdown. i think we've been through a soft patch that's lasted nine months. i've got the economy reaction sell rating in the u.s. next year and growth here will continue to be better than in europe. if you thought we were heading to a recession here, michelle, i agree with you, get overseas more quickly. but we don't have that in our forecast. >> all bright. contrarian, bucking the trend today. thank you both very much, guys. appreciate it. coming up, after months of gridlock, could a peaceful brexit be moving forward in the headlines that have markets

rallying today and the players that can get that across the finish line coming up. brexit is one of the reasons for the strong market rally, trade being the other biggie of course. and materials, industrials and energy are your sector leaders in the s&p today. we'll have much more oalofn l that straight ahead on "the exchange." driverless cars,

or trips to mars. no commission. delivery drones, or the latest phones. no commission. no matter what you trade, at fidelity you'll pay no commission for online u.s. equity trades. welcome back to the exchange. markets are surging today on hopes for a china trade deal but it's not just china pushes us

higher. for more let's go to bob at the new york stock exchange. hi, bob. >> rumored there are two other factors in today's rally besides trade talk. i think they're contribute together rally. first is a potential brexit break-through, which is rallying europe, by the way, almost 2%. second word that hong kong protesters are discussing dialing down the protests over there. which resulted in a better than 2% rally in hong kong. back up assuming we do get a modest deal today, a trade truce, just no more tariffs, that's a modest deal, how much more is really left to the rally? so the s&p has moved 40 points in the last 24 hours. it's now just 1.5% from its old highs. it's likely that an announcement of just that modest deal, no more tariffs may not advance the markets much more unless a much more comprehensive deal is announced so the does a truce get markets through christmas? i asked that from art the other day and that's the big question. he's not sure either. the problem for markets is is it did is not change the lower

growth market for 2020 and temperature does not end the trade wars. remember, a truce does not end the trade wars the battle will continue to 2020. kelly, let me qualify what i was saying about not necessarily rallying. if all the sudden an announcement is made and the tariffs ever completely eliminated, we'll have a much bigger rally today. but a more modest one where there's no more tariffs, i'm not sure how much more juice is left in that ral. >> i that's a good point. we'll see what we get. thanks. let's get over to sue herera now. >> here's what's happening at this hour. the former u.s. ambassador to ukraine telling lawmakers that president trump pressured the state department to remove her as part of a concerted campaign against her. that's according to multiple reports. merio v merio mary -- yovanovitch was

relieved of her duties in may. 4,600 acres in california have been burned, 26,000 homes have been evacuate and 100,000 people have been displaced. the fire has grown to more than seven square miles. unite is the latest airline to scrap plans to bring back the 737 max before the end of the year they say they will keep the jets off the schedule through january 6th. it will cancel 8,300 flights from now until january. and a recall to tell you about. blue bell ice cream is recalling a batch of ice cream that may contain pieces of plastic. about 1700 half gallons of butter crunch ice cream produced at a plant in alabama in late august may be contaminated. it was sold in the southeast. check those refrigerators. that is the ws updhat hour. kelly, back to you. >> sue, thanks very much. still ahead, steve mnuchin is now set to hold a press conference at 1:45 p.m. eastern time. that's just about 15 minutes

away. we're being told it's not about china, but he will be taking questions and we'll take you there live as soon as th gets underway. we're back in two.

welcome back. stocks just jumped higher on reports a partial trade deal has

been reached between china and the u.s. in washington. we jumped about 100 points, now we're only up about 30 relative to the last time we checked. dow's up 388 right now. of course as soon as we get more confirmation or further word we'll bring that to you. we're expecting to hear from the treasury secretary in about 15 minutes time. it is time for rapid fire and here is bill griffith, elon and robert frank. it's great to have everyone here. roku is not rapid fire lately if we're not talking about rope cue. it's higher again today. it's been a huge week for them they got you'd performed this morning which she's says a more compelling valuation is hard to believe after this run-up. it makes it one of their strongest plays in streaming video. they also boosted the price target by $48, which is another 30% rally. here are the roku shares which are up 14% this week and have now nearly quadrupled on the

year say huge momentum. we got confirmation of that with the 13 d from ken griffin that citadel owns a big piece in it as well. >> with the streaming services coming online, this is going to be a boondoggle for a lot of the devices out there. and roku has been the leader in all of this. i was talking to todd hazelton who does reviews of these devices and he was telling me that disney plus hasn't signed up yet with fire tv. so if you're going to start to have a little turf wars with some of these streaming services that could become very popular, but they're not available on all the devices. >> right. >> i mean, then you may have a real situation there. it could be a great thing for roku here, right >> you wonder, though, i have a smart tv, right? so i have -- you have all the streaming services on your smart tv so i don't really understand what roku does. but i'm told that it -- for people that want to aggregate it is it is the smoother can sort of cross channel device. >> some tv's use roku technology

to present us that experience. but they're trying to -- >> but what my big question with roku ar are t roku, at what point will they become a content provider? right now they're dependent on amazon, google, netflix and hulu. at ha point do they say if they guys pull out -- >> they have a movie channel. they're work october advertising stuff. >> primarily they seem to be an advertising business now. so i think the question is, you know, do you -- how much will consumers accept all those ads popping up. >> without paying for it. >> or are you going to pay for it in dollars verses in eyeballs sooinls sign up for something like apple tv which is what i have so you don't have to watch all of those ads. >> the dvr has never looked better and i stand by that. next, facebook and google are causing more headaches for the ad agency. google assist plummeting today

after lower guidance for the second time this year. they're now expecting organic revenue to drop and they're all struggling to deal with the dominance of the tech giants and they face new competition from people who are trying to position these clients more nimbly for the mu market. consulting firms for the giants. this is not madmen. >> we are far from that. social media plays a huge part of this. we'll talk about productive here and what the fed's looking at, all the free stuff that's out there and on social media, you know, that's a very effective way to advertise these days in the nontraditional sense. >> and they need big data in all of these different ways of best using those platrms that don't necessarily play to the historical, traditional storytelling type tv focused strength of these ad giants. >> i think that the advertising business and the way that the internet platforms have dominated them, that's low-hanging fruit. >> very much so.

>> that's why the state ags are going after google primarily on advertising, maybe some other issues will come into that, but the ad business is where they're focusing their attention to begin with because it seems to be the biggest and most obvious probable problem. >> facebook and google together two-thirds of the ad market. it's amazing we have other agencies left with them fighting over the one-third in addition to all the other digital companies out there. there's just not that much zbleft itleft >> you're wondering if they're the ones pushing some of this, crack down on these guys >> right. >> there's probably a whole generation out there that have has no idea what a tv dmescommel is. >> what's the net worth to you the answer to this question is exactly what the federal reserve wants to know because it's struggling to explain weak productivity in gbp growth. elon, some of these nuggets are hysterical, but people would have to pay money to stop using their favorite services.

>> what the story is about is how do you val ute digital economy. the problem is with our statistics is they're based on price. if these services are free how do you account for them in our standard tools of measurements so what researchers did and this is what the fed is look at is survey a bunch of consumers and users and say how much would it take for you to give up this service? they found for something like facebook it would take $48 for people to give it up for a month. >> for a month. >> for a month, $48. but if you want to get something like search, it's going to cost you $17,000. >> that was for a year. >> that one's for a year. >> bill and i would both pay more than that because we use -- i mean, it's crazy how reliant we are on this stuff. >> absolutely. >> but the way you phrase that is important. so there's a difference here because a lot of us would say if asked how much would we pay for this, the number is not very high. but how much would we have to be paid to stop using it? so that speaks to the business

models here. >> jerome powell referred to other day and they're trying to figure out how to quantify this in their measurement of gdp growth out there. i was thinking about this for my own life you'd have to pay me a lot to give up playing gfl. but you wouldn't have to pay me a lot to give up watching giants football games for example. >> what does that tem you? is that just because of this season >> these valuations, you know, we've looked at it in terms of the productivity, but what about in terms of the consumption? >> what's the benefit the consumers find some some of these services i thought it was interesting when she surveyed users on twitter the amount they would need to give it up was zero. >> to give up twitter itself >> to give up twitter. >> those were europeans, weren't they >> they were the europeans, it's a whole different business model off. >> there. >> who love their what's app. >> the bottom line is is productivity better because this value is not being captured zbli >> i think it's undervalued.

nba says it's canceling all media availability for the rest of the -- >> sorry, sir, we're on live television here. >> the league's time in dmiena will come to a close following tomorrow's game between the brooklyn nets and the lakers in shan zen. so we can help break down the events of the week. the other interesting thing that's happened over the last day or two is china realizing i can't risk alienating the nba. if you have 500 million fans, you don't want them upset too much. >> maybe. but they removed all the sponsors from the court, that it was just a blank and empty court. that game was played in china, it was not aired in china. the only people that could watch it were us here in the states. >> and the people in the stadium, right >> and the 15,000 in the stadium, and they were handing out chinese flags on your way into the stadium. if china wanted to they could just say to their country through their state-run media, the nba has offended us. the nba has gone against chinese values, we're abandoning the nba

from here and maybe they could convince people we're going to sign with the government because the nba is bad. but they probably know you can't convince 5 million people of that. >> that was my question. we've only heard from the chinese government on all of this and how upset they are. but we haven't heard from the chinese fans at all on this, right? >> there was an interesting piece in "the wall street journal" that did interview a lot of fans particularly of the houston rockets. they have history there. and that's where it all started. and a lot of diehard lifetime fans of the rockets are saying, you know what? we're out. >> chinese fans? >> chinese fans. >> social scores is going to hurt you over it there. >> and it's because we underestimate the amount of nationalism in china right now for all sorts of reason. and the timing of this, the actual specifics of the comment and the way it was handled, it did turn a lot of fans off. >> it was interesting to me when you said what is the value of ten cents contract with the nba, it could hurt the players them self. >> 200 million aids year for streaming rights in china.

the same way that espn or turner pays the league for rights, turner has their deal. 200 million a year, if that goes away the league and players split it 5050. now 100 million is gone from the teams. that's 3 million a year in salary cap if you're a max player like klay thompson or whoever, lebron, that's $5 million in the course of a year deal. >> the players have been quiet on in the 'guys like klay thompson have sue deals th chinese companies? >> his deal is maybe an $80 million deal over ten years, makes annual trips. it's not like he's selling nikes in china he's selling chinese shoes. >> that's why we haven't heard much from the players. real quickly because we're following the news to see if we get this trade deal so to speak. does the nba breathe a sigh of relief in that case or does it seem like this is a completely separate issue where adam silver has to figure out how to patch this over? >> because the trade deal's about tariffs in the is about watching games. there's no tariff on watching a game. >> right. >> so this is totally unrelated. you saw the way that president trump, he didn't really get involved in saying this is the

outcome that i want, just they got to figure it out in the is not a tariff-based issue for me. >> he didn't really take sides in it as well. but, again, mine china's realizing they don't want to push too hard. >> they've warned the nba, you pull this again -- >> have they >> think about it, we've gotten the point. >> yeah, the point has been -- >> we got the point all right. >> i think that's been made loud and clear. thank you all. appreciate it today. and still ahead, treasury secretary steven mnuchin is set to hold a press briefing in a couple minutes time. it's not about china but he will be taking questions and we'll take you there live. plus, a meeting moobetween prime ministers of the uk and brexit approximately we'll tell you where they stand in a few minutes. broad coverage and still may save you money on monthly premiums and prescription drugs. with original medicare, you're covered for hospital stays and doctor office visits, but you

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we'll follow that event live for you as it plays out, of course. markets are happening on to about a 427 point gain right now as they focus on reports of a china trade deal. that happens at 2:45 p.m. between the president and the advi vice premier of china. we've got positive signals from the uk, even from the eu that a brexit deal might be possible. will is here with more. are we talking about a deal by the end of the month, them leaving? >> possibly. the market move suggests there's hope of that. sterling has surged nearly 40% in 48 hours as hopes of that brexit deal have dramatically improved. the uk and european risk assets have loved that news, especially the domestic focus ftse 250 and the irish stock market to avoid the worst case scenario of a no brexit and the uncertainty that an election would bring. having seen hopes for the uk prime minister boris johnson's deal lowered on monday after

reports of a sour phone call with german chancer angela merkel, we saw a dramatic turnarou turnaround yesterday followed by an upbeat meeting which was further cemented today at the eu level fold by stephen barclay and the eu negotiator. so what next the eu and the uk need to finalize a deal ahead of next week's eu summit. boris johnson needs his northern irish partners the dup and the anti-europe conservative group the erg to back him until then and then crucially in a parliamentary vote on the deal. he could probably survive losing a handful of those voters by gaining labor lead rebels but not the entire group. the move in sterling to a three-month high shows the market is hopeful and there have not been any comments to destroy that hope, though we're still a long, long way from confipp arm the deal altogether.

>> will, thanks very much. as mentioned, that's one of the things boosting global markets today. as we await to hear from the treasury secretary -- looks like he's coming in right now to hold a press briefing. steven mnuchin, let's listen in. >> the treasury department in consultation with himself and secretary pompeo, very significant new sanctions. authorities that can be targeted at any person associated with the government of turkey, any portion of the government this will be both primary sanctions and secondary sanctions that will be applicable. the president is concerned about the ongoing military offensive and potential targeting of civilians, civilian infrastructure, ethnic or religious minorities, and also the president wants to make very clear it is imperative that turkey not allow even a single isis fighter to escape.

again, i want to emphasize at this point we are not activating the sanctions, but as the president has said, he will provide very significant authorities based upon the continuing efforts. so he will be signing this, they will be active, we will be working in consultation with the department of defense and department of state to monitoring this very quickly. we are putting financial institutions on notice that they should be careful and that there could be sanctions. again, there are no sanctions at this time, but this will be the broadest executive authorities delegated to us. >> when you spoke with the president, was there any concern about the actions he took that led to this and can you tell us when would you put these sanctions in what would it take for you to actually activate it >> well, on -- no, i don't think he thinks his actions are what led to this. it is a complicated situation.

it's a situation that we're all concerned about and the humanitarian situation. and there are very clear discussions that will be going on between the department of defense and the state department. i just got off the phone with the finance minister and we will be communicating specifics that we're not going to telegraph here. >> mr. secretary, can you give us an update on the china trade negotiations >> i didn't think anybody would be asking me about that. >> trade negotiations that are going on today, is it possible that we get it by the end of the day today with no new specific deals agreed to or are we definitely going to see something? >> i wanted to make sure everybody knew in advance i wasn't talking about china because i didn't want to think i was calling a specific china meeting. we have had productive two days of discussions. ambassador light houser aauser. we will be meeting with the president shortly and updating the president shortly.

he will be meeting with the vice premier. i wouldn't be surprised if he decides to invite a few of you in but i'm not going to make any other coents in advance of middle easting with the president. >> the stock market is optimistic about what it sees. are they right to be optimistic? >> stock market's always right. >> is there -- is there reason for optimism >> again, i'm not going to make anymore comments. i've said we've had productive two days of discussions, we'll be making more announcements after we meet with the president. >> mr. secretary. >> yes. >> so far turkey has not been dissuaded by anything this administration has done or the president has said. what makes you confident that the announcement that you just made is going to change turkey's -- >> i don't agree with your premise. i'm not going to comment on specific confidential discussions that had been going on on different levels. so i don't think that's a good premise. but, again, these are very powerful sanctions, we hope we

don't have to use them. but we can shut down the turkish economy if we need to. >> mr. secretary -- >> how does the threat of these sanctions help these u.s. allies who say they have been abandoned? >> again, it's a complicated military situation that is ongoing. ther there are discussions. i think the president has had very specific discussions. as i said, the department of defense. we have expectations this is a way of making sure that we protect the humanitarian issues and the other people on the ground >> reporter: as far as you know have plans changed about turkish president erdogan visiting the white house? >> i am not aware of anything that changed i am not confirming that i haven't heard anything one way or the other. >> reporter: what kind of consultations are you having with lawmakers like lindsey graham, senator van hollen who have been critical of the pull

out of troops in syria >> secretary pompeo has been speaking to them daily i have spoke to the secretary multiple times a day the message to congress is i know people were contemplating sanctions. we are on top of sanctions the president will loose them when necessary thank you, everybody >> that's treasury secretary steven mnuchin let's bring in kayla for more reaction to this announcement that does not appear to actually activate the sanctions themselves >> he says they are authorizing but not activating the sanctions. he says the financial institutions in turkey should be put on notice by this announcement and that the u.s. administration can shut down turkey's economy at any time there is a little moment of levity in that briefing when our eamon javers asked him about china trade talks. he said i thought i was clear i wasn't going to be talking about that he didn't confirm the reporting out there, that there is a

partial deal that has been reached by the u.s. and china. he did say that the stock market is always right and is right in this case to be optimistic about what might be coming later today. and he said that he and ambassador lighthizer will be meeting with the president momentarily. they will be updating him on what transferred during two days of negotiations. the treasury secretary said you will likely see announcements later. >> i thought that was a cheeky line when he said the stock market is always right but on the issue of turkey, the fact that they would authorize but not activate the sanctions, does that have any meaning >> it certainly is supposed to serve as a warning to turkey he dodged the question about what concern he has, if any, about some of the actions that led to turkey's going into syria that came on the back of a phone call between turkey's president and president trump after which president trump removed u.s. forces from syria.

the treasury secretary didn't go there. certainly there would seem to be some at least tacit acknowledgment that the u.s. may have played a small role in this but wasn't willing to comment to that extent. >> a small move, a gesture, if you will, the beginning of what could be more to come. thanks see you again shortly. that was the latest out of the treasury imposing the authority for sanctions that u.s. will be granted on turkey. a check of the markets dow's up a 418 waiting on confirmation what has been agreed to between the u.s and china. the president anvi pd ceremier meet in an hour's time more exchange after this how are we doing? fabulous. ♪ i wonder how the firm's doing without its fearless leader. ♪ you sure you want to leave that all behind? yeah. stay restless, with the icon that does the same.

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hey. ♪hey. you must be steven's phone. now you can take control of your home wifi and get a notification the instant someone new joins your network... only with xfinity xfi. download the xfi app today. welcome back let's get a check on the markets. the dow is up 434 points right now. that's 1.6%. we are about 60 points off the session highs where we started earlier in the day on hopes of a mini or skinny u.s./china trade deal the white house sees this more as action items as opposed to any deal that nmay be coming today. reports in the last 20 minutes that a breakthrough has been

reached are pushing up towards session highs. the nasdaq about 3% off all-time highs right now. the dow and the s&p 500 just under 2% off of their all-time highs as well. elon moy is here with more we just heard from the treasury secretary. he was talking about sanctions authority on turkey. he was asked about ochina. he said it's been a productive two days of discussions but i'm going to go brief the president. i am not going to say anything when asked about the stock market rally if anticipation of a deal, he said, quote, the stock market is always all right. >> i feel like very productive is some of the secretary's favorite words to use to not tip his hand in which way the talks are going. so i wouldn't read too much into that particular statement. what i do think is notable here is how the terms of success have been redefined we talked earlier about the idea of a skinny deal i mean, what if the market has come to accept and what the

market sort of expects to be a win is now much smaller than we thought about a year ago so the idea that you are removing tariffs set to take place in a week, that we had not even expected in the first place, i mean, the president has been very adept in creating mull leaders to say he secured a dealing when underlying tensions between the u.s. and china may not have abated. >> or gotten significantly worse. on the action items, we are talking about china doing agricultural purchases, some language maybe around currency manipulation, maybe some market openings these are the things on the table. the u.s. grants huawei waivers the focus is are the tariffs coming next week or not and is there a chance the december 15th round will be pushed off that seems to be the top concern now. >> those action items that kayla has been reporting on have been on the table for quite some time and so i think that they seem to

be in the same place and they keep getting closer and closer to making those agricultural purchases or granting licenses to suppliers of huawei if they accomplish something and say these are things we ticked off the checklist. that's progress. that's moving forward. but again the fundamental, the tough issues still have not been addressed. i wonder if the action items are enough for the president's base so say, hey, taking on china and made some progress here. >> also the agricultural purchases pushed us higher earlier in the week. this has been priced in. the currency manipulation language may not be that strong. the chinese market openings issue is a bigger piece. i wonder if we get substantial progress there. >> yeah. i know the ag industry has been pushing for that the beef industry, the pork industry, et cetera. that may be one area that helps that support in the farmland and heartland get stronger as we enter the election cycle. >> absolutely. and the choinese know that.

appreciate it. that does it for us. "power lunch" is going to pick things up right now. >> and we will see you in a moment a major market rally trade optimism sending stos surging reports saying the u.s. and china have reached a partial deal the treasury secretary saying the stock market is always right when he was asked about the markets in reaction to those talks today. you see triple digits for the dow as well as the nasdaq. a look at the big name stocks hitting record highs today, a lot of them t apple, walmart, home depot to ma name a few higher caterpillar, united technologies we are live in washington, wall street, and beyond "power lunch" starts right now >> good afternoon and welcome. trade talks. the story dominated the markets today. a key meeting se