destructive to energy infrastructure they can still use the drones, missiles, maintain operationalty, be very disruptive to the middle east oil supplies. >> helima, thank you so much for your time. it's an important story. with your help, we will understand it better helima croft from rbc. we are awaiting the president who will obviously speak in the grand foyer in a few minutes, having decided not to address the nation last night. eamon javers can help us understand what's coming up. >> one process point here, and you can see it on the wide screen now, they opened it to the press corps so there's a flood of reporters going in for the president's remarks. earlier it was scheduled to be just the pool, which would be a smaller group of reporters that may -- and i stress may -- mean the president is of the mind to take questions from the press corps here and that mied give us a sense of what his state of mind is

and another indicator is simply the fact since these iranian strikes last night in iraq, we have not seen a u.s. military response remember, the president in his warnings to the iranians before the strikes suggested he had 52 sites targeted and ready to go if the iranians took any action. the president has not pulled the trigger on that option since the iranians took their action last night. that may indicate he's in sort of a strategic pause kind of a mindset. we will see. it's hard to read in anything to what the president might be doing here because they've either been very careful not to give us any indication of what's in these remarks coming up i have been texting and pulling officials aside in the hallway in the west wing trying to get an indication and they simply won't tell us what the president's tone is going to be or any of the content of these remarks. this will be as fresh to all of us as it is to everyone around the world when the president delivers it. but i think those two tonal things give you a sense of where the president might be this morning in terms of opening the wider press in to hear these

remarks, and having not taken that military action today. >> eamon, we'll obviously be listening for a framework regarding the strategy of iran that's important but also what is important is what "the washington post" calls a series of confusing and contradictory events, whether or not that was our willingness to go after cultural sites, whether a decision had been made to start pulling american troops from iraq. do we expect him to address that >> i would expect him not to no one has told me that directly but the president in the white house yesterday was asked by reporters about that situation in which a u.s. marine corps general sent a letter to the iraqi's side which the language of the letter seemed to indicate the u.s. was getting ready to pull troops out in response to the iraqis over the weekend. the president said he didn't know anything about that letter and asked mike pompeo, secretary

of state, to address it. clearly the president doesn't want to deal with that issue he seemed to, just by body language and tone, view that very much as a distraction he said that letter was an accident it was sent by mistake to the iraqis, it was just a draft. and it did not indicate u.s. plans to pull out of iraq. i think we might get an indication of whaez his plans are for iraq he said yesterday he would like to see the united states withdraw from iraq entirely at some point in the future will he give us any clarity on what his vision is for the u.s. troop presence in iraq over time that's one question we will look for in the opening remarks. >> one thing that's incredible to me as we see the tensions flare and strikes back and forth take place over the last couple of days, so much of rhetoric has once again taken place over twitter. whether it's president trump and his tweet last night, which is kind of surprisingly optimistic or even jthe foreign minister o

iran, really getting circulated today, taking measures in self-defense, et cetera, et cetera, how do we think about the fact so much is now taking place on twitter and how does that compare to previous conflicts and previous issues that have flared up in the past? >> i think you have to look at social media here, morgan, in two ways one is there's direct messaging to each government from each other going on here. iranians responding with a tweet of the iranian flag sort of trolling the president for his tweet of the u.s. flag last week after the attack on qassem soleimani. that seems to be direct sort of messaging government to government then you also have a propaganda effort going on here, an enormous quantity of social media activity taking place around all of this, sitti i was sitting in the living room

with my son and he said look at this, dad, all of these posts showing up in arabic and english showing up pro-iranian under the most recent donald trump post on instagram. suddenly 218,000 comments on the president's most recent instagram report showed up a flood of those were from supporters of the iranian government saying this is our vengeance, this is our strikeback, all happening shortly after the missiles flew last night you're seeing this 21st century combination of ballistic missiles and ballistic tweets and ballistic instagram posts all mixed together, and you have to really decipher what's being communicated here and who it's being communicated to. >> yeah, that's a good point, eamon. just as we look at the podium and we await president trump and his words this morning, is the expectation that he's going to be joined on that stage by other members of his cabinet i know you mentioned earlier you're reporting he spent a part

of his morning in the situation room with the vice president, secretary of state pompeo, defense secretary esper and joint chiefs chair milley, general milley as well are they going to be on stage with him is there any reason to think we will get comments from them? >> we don't know the answer to that yesterday he turned to other officials for additional commentary this venue in the grand foyer usually we see the president alone there. you think one of the more famous episodes recently there was barack obama announcing the killing of osama bin laden in a very similar venue now we may see the president flanked by his military aides and top civilian advisers or he may want to do this solo, we don't know one official here did indicate to me the president may bring all of those folks up within the camera shot, but we just don't know that for sure and i think that would also tell you a little bit about what the president is trying to communicate in terms of the message. is he trying to say it's i and i alone, or is he saying my entire

administration is united on this and here they are all for you to see? that will be telling as well. >> bob mcnally still with us bob, you talked earlier about the risk premium remaining somewhat intact and chances for further escalation going forward. how much is contingent on what the president says in the next few minutes? >> well, not too much going forward. the president's probably going to ratify the market's relaxation since late last night when it was clear no americans were killed and the president canceled the news conference for the statement. it's clear for many hours no americans were killed, the president's red line was not crossed, he's not going to unleash attacks against 52 sites and we're not going to triple digit oil for tonight. so the market is reacting to that this morning. it's understanding, i think the president will probably ratify that by reminding he's ready to unleash a massish military response if iran crosses his red

line. >> yeah, bob, you just mentioned the bearish numbers, inventory numbers today. how much is that weighing on crude right now? and is it something that will actually take over as the bigger narrative today, at least among traders in the energy sector >> the first half of this year is really oversupplied the numbers this morning probably had attacks accounting shenanigans and there will probably be adjustments with the eia. last year's numbers were goofy so we will he wait and see on that last year was a tug of war with bearish fundamentals that is starting to show up in our data and on the other hand geopolitical risk coming back after recently being in again in mid-september. >> bob eamon stay with us, the senior chair of evercore and former deputy sector is with us

now. roger, i want to get your thoughts, what we may hear from the president this rng month and what it means for the broader market >> i think there is relief as was just said because iran has essentially sent a dovish message. they intentionally avoided, in my view, killing any american personnel because they don't want this to escalate. i think that's the clear implication of what happened last night and a good implication. it's a cause for relief. and presumably, we will see in a minute, the president will say that we're all on alert and he will keep his options open and maybe even sound a threatening note but one hopes that the dovish iranian response will be accepted by the united states and that the level of tension will be reduced. that's what the market is

thinking right now, and that's what we should all hope for. >> roger, given the fact there does seem to be a deescalation afoot now based on the rhetoric and based on the way these strikes played out last night, would it becrazy to think we could actually in the coming weeks and in the coming months be moving closer to negotiations with iranian >> that's hard to say. among other things, none of us knows whether president trump actually wants to negotiate or rather wants to keep iranian in his sights as an enemy, so to speak. in other words, wants the issue rather than the solution we just don't know that. we also don't know how difficult it will be internally within iran for the iranian leadership to negotiate very hard to say i would be a little skeptical on that but that's more intuition than it is evidence. >> there's also the remaining

issue of north korea, which at the turn of the year, roger, as we all know, has started to saber rattle once again. another instance in which diplomacy teamed to have diminishing effectiveness. i wonder if you think the white house, even if it's a tangential dynamic, is trying to send a message to what they're doing with iranian to chairman kim >> that may be, karl i think north korea is a totally separate thing because looking back on it the dynamic between president trump and kim jong-un was a pretty strange one, to put it one way and nothing came out of it at all, despite a lot of theater. and i don't happen to think that north korea is going to do something insane because they would destroy themselves if they tried to initiate any type of hostile act. i think it's all saber rattling.

but nevertheless, that's a whole separate thing and i think a much more controllable thing than the dynamic with iranian and iraq and the very combustible middle east the iranian situation to me is much more dangerous. >> okay. we want to bring another voice into the conversation as well as we await remarks from president trump. the president of grz energy who was here at post nine. anthony, great to have you. >> thank you. >> want to get your thoughts on the conversations we're having, what it means for crude and broader markets and just geopolitical threats. >> i think obviously the price of crude will be elevated but the traders seem to be kind of immune to the situation that's going on here. i think they look at it and say no oil facilities or production has been threatened at this point, none of it is offline there's been a lot of talk about the straights of hormuz but we

have been through two gulf wars and those straits have never been closed. iran will want the markets open now. and more than that there's a lot of spare capacity that can come online and kind of alleviate if there is a shortage of oil. >> i wonder what you think it does to the spread of wti and brent right now? especially amid reports shipping costs and insurance costs for those crude shipments moving through that region right now are beginning to go higher. >> i was watching it last night, morgan that spread a couple weeks ago was about $5 it's $7, $8 now. i expect it to go out even further from that because the brent would be most affected by what's happening in the middle east in the gulf right now >> bob, i want to get your thoughts on that too i wonder if given the fact there is this geopolitical risk premium, if you will potentially in the crude market, what that could mean for incentivizing more u.s. product to be exported around the world right now >> well, the challenge is we

export light crude what's being disrupted are heavier grades so were there to be a disruption in iran, were the u.s. to sanction up to 4 billion of oil a day like iraqi crude, i think it's unlikely but this has come on the table, this affects type of crude already in short supply, heavier grades on the margin helps the u.s., of course, as safe and ample and reliable supplier. it will keep exporting but our crude is light and sweet and not really what the market is looking for right now. >> got it. anthony, the fact energy stocks are down 1% right now, perhaps not surprising given the numbers we got inventory wise here in the u.s. and the fact crude has come off as well. >> it shows demand, especially gasoline the biggest derivative of crude oil is gasoline. half of it is refined into that. when you have a build of 9 million barrels, which is the largest one we've had in about 15 years, that's going to affect

the market right now unless that demand picks up, you're going to see prices trend lower, not higher. >> i want to bring another name into this discussion as well, scott nation, cio of nation shares and also cnbc contributor who's with us too. scott, i want to get your thoughts what we are seeing in the market are you surprised to see the nasdaq hit an intraday high as we have this conversation? >> certainly and i'm also surprised the s&p futures are a full 60 points off their overnight low. what does that say to reiterate what's been said before? the market now believes the kinetic portion of the turmoil is to use the word of the day concluded. i think it's interesting the broad market is a little higher on the day, technology stocks are doing well and because energy names are just getting killed, xop, exploration of production etf is down about 2 1/2%. the interesting thing is all of these geopolitical spikes in

energy prices have been spikes to sell. why is that? we have all sorts of production, whether it's russia, saudi proving they can get back online quickly or frackers here in the united states. as long as president trump claims victory, i think the broad market, equity market, will be pleased with this. this could have been ugly and they were worried. this will be a victory for the equity markets as well. >> roger, i want to go back to you and specifically the discussion around iranian. there's been a lot of talk in recent days about whether the whole maximum pressure, economic sanctions on the country have actually worked or not given the fact we did did see a ratcheting up of military strikes between the two countries. has sanctions worked >> it's a complicated question but i think the answer is yes. by come floricomplicated i meane are a lot of different levels to

it it's worked in the iraqi economy is extraordinarily week. there was a loss of prior discontent prior to the soleimani assassination on the streets of tehran and elsewhere in the country the sanctions crippled iran, even though the country was weak to begin with. if that's your definition of working, they have worked. i think this particular set of tensions, which obviously began in the last two or three weeks and reached a peak in the last 72 hours, 96 hours, are not particularly related to the sanctions but have the sanctions weakened iran? yes, they weakened iran severely >> as we're talking here, markets had a bit of a bounce. s&p almost 10. route reuters is out, i mentioned a story a few minutes ago, u.s. officials sent guided missiles capable of pretty good accuracy

and yet the rockets hit unoccupied areas around buildings. maybe this was clearly an invitation for the u.s. to take an off-ramp. we will see. >> that's right, and it goes to the connection we talked about earlier of iranian intent. as we watch the white house and wait for the president's remark, the question will be about the president's intent as well and you talked about the idea of the president sort of declaring victory, taking a bit of a victory lap in the grand foyer there's danger there rhetorically for the president though in doing that because what the president has to thread here is sending a message to his domestic political audience that we succeeded here and this is over if that's what he wants to say, but then also not further antagonizing the iranians by appearing to take a victory lap in a very public way, in any way that would make them feel like they lost face, they didn't accomplish what they set out to accomplish last night. he needs to in some way leave

the iranians thinking they set out what they meant to do and at the same time leave the americans believe this is in effect a successful attempt for the united states. we will see what he has to say but there's a nuance that makes this so fraught in the white house as we wait for the president. >> to your point, the president is about 20 minutes late we're going to take a quick break. we hope to hear from him on the other side when you look at the world, what do you see? we see patterns. relationships. when you use location technology, you can see where things happen, before they happen. with esri location technology, you can see what others can't. ♪

live shot of the grand foyer at the white house where the president was scheduled to start speaking about 20 minutes ago. we're awaiting his appearance. we think he might be joined by some top national security officials, obviously responding to the iranian attacks at u.s. bases last night where u.s. troops are held or housed. market had a little choppy morning but for the time being hold onto the green. s&p up to 3,245. boeing, of course, in a crash in tehran. >> yes, and they're hanging on to gains on the heels of the strike on iranian as well. we want to go to phil la bu for a breakdown on boeing. >> if you look at shares of

boeing, they're under pressure but certainly not down as much as was indicated premarket when the first reports were coming out of iranian about a 737-800 that's a 737 ng, next generation model, that was delivered from boeing to ukraine international airlines in 2016 a relatively young aircraft, and it crashed within two minutes of taking off the circumstances of how it crashed are highly unusual, that it was down within two minutes of takeoff there were reports at the time from iranian news agencies saying they suspected may have had engine problems, there might have been mechanical failure but keep in mind, we hear those reports whenever there's an airplane crash you have to wait to look at the black box, cockpit data recorder, et cetera, before you get a sense of what might have actually brought this plane down speaking of the black box, there are reports iran does not want to share the black box data with boeing or the u.s.

interesting whether or not that continues. they certainly consented to other places overseas where the data can be analyzed, but that will be an interesting one to see how it plays out over the next few days as they try to get a little more details about what exactly happened. >> all right, phil, of course that all comes in advance of what we're expecting next week, and that is obviously q4 earnings, a lot of corporate commentary, high-profile corporate conferences regarding health care and other sectors. bob pisani will be watching all of that as earning season picks up this week, bob. >> yes, and what a roller coaster it was today and overnight. i want to point out the three key developments, people asking why are we up today, and the bottom line is iranian foreign minister said it took and concluded important measures, that there were no casualties and they did not target energy facilities and that was key to what was going on here. the s&p wild 50-point move overnight. down 50 points one hour and next

hour and a half all the way back to start the algos went crazy on the initial bottom lines point is we held up all right. we also got the inventory levels early on and, of course, they were bearish oil is essentially collapsing to back to where was it was on january 2nd, and that was right about the time we had the announcement of the killing of the iranian official, january 2. sectors either side positive or negative, semis, retail, consumer staples doing very, very well. i think the key is what's going on in the earnings situation even walgreens was a little bit of a disappointment. they did reiterate their full year's guidance. constellation brands they beat, that was a good sign and van neck investigators also doing well today >> we will be getting to the president i think in a moment.

i eamon javers, what you think the market may be up to. >> after we hear exact as ulties, the numbers and military specifics of what happened last night and more specifics possibly on the president's strategy going forward how does he see this unfolding and what is his message to the american people about what they should expect? is this, as some commentators have said, the brink of war? or is this diplomacy being played out in an entirely alternate fashion? i think that's the signal we should look for here from the president and finally any message from him directly to the iranian leadership >> and also, eamon, we can't ignore the fact two big players, namely china and russia, continue to hold a lot of influence in the region. and that's going to be visible when we -- we think get a phase one signing next week. there's the defense secretary,

the vice president, secretary pompeo and some national security officials are beginning to fill in here. as we understand last night in the situation room, the president was joined by pence, pompeo, esper and the chairman of the joint chiefs. so this was -- obviously, communication ongoing last night between the white house and key congressional officials, like speaker pelosi. >> yes, it looks like you have the chairman of the joint chiefs, general mark milley standing there as well as top-ranking generals for the different services i think the expectation here is that we will hear from the president really any moment, and certainly as we know from eamon's reporting, he has spent the better part of the morning with these key national security advisers >> it is striking to consider the fact that this remains a big test for the president, and one that the market really was not discounting in advance

eamon, as we all know coming into the new year, it was largely about china trade and this sort of came out of left field, which is forcing the market to both re-evaluate but also given the price action over the last 72 hours, really take a lot of this in stride. here's the president approaching the lectern in the grand foyer let's take a listen. >> as long as i'm president of the united states, iranian will never be allowed to have a nuclear weapon good morning i'm pleased to inform you, the american people, should be extremely grateful and happy no americans were harmed in last night's attack by the iranian regime we suffered no casualties. all of our soldiers are safe and only minimal damage was

sustained at our military bases. our great american forces are prepared for anything. iranian appears to be standing down, which is a good thing for all parties concerned and a very good thing for the world no american or iraqi lives were lost because of the precautions taken, the dispersal of forces and an early warning system that worked very well i salute the incredible skill and courage of america's men and women in uniform for far too long, all the way back to 1979 to be exact, nations have tolerated iran's destructive and destabilizing behavior in the middle east and beyond those days are over. iran has been the leading sponsor of terrorism in their

pursuit of nuclear weapons threatens the civilized world. we will never let that happen. last week we took decisive action to stop a ruthless terrorist from threatening american lives at my direction the united states military eliminated the world aers top terrorist qassem soleimani. as the head of the quds force, soleimani was personally responsible for some of the absolutely worst atrocities. he trained terrorist armies, including hezbollah, launching terrorist strikes against civilian targets he fueled bloody civil wars all across the region. he viciously wounded and murdered thousands of u.s. troops, including the planting of roadside bombs that maim and

dismember their victims. soleimani directed the recent attacks on u.s. personnel in iraq that badly wounded four service members and killed one american and orchestrated the violent assault on the u.s. embassy in baghdad in recent days, he was planning new attacks on american targets, but we stopped him soleimani's hands were drenched in both american and iranian blood. he should have been terminated long ago by removing soleimani, we sent a powerful message to terrorists, if you value your own life, you will not threaten the lives of our own people as we continue to evaluate options in response to iranian aggression, the united states will immediately impose additional punishing economic sanctions on the iranian regime.

these powerful sanctions about remain until iranian changes its behavior in recent months alone, iranian has seized ships in international waters, fired an unprovoked strike on saudi arabia, and shot down two u.s. drones iranian's hostility substantially increased after the foolish iranian nuclear deal was signed in 2013 and they were given $150 billion, not to mention $1.8 billion in cash. instead of saying thank you to the united states, they chanted death to america in fact, they chanted death to america the day the agreement was signed then iranian went on a terrorist spree funded by the money from the deal and created hell in yemen, syria, lebanon, afghanistan and iraq

the missiles fired last night at us and our allies were paid for with the funds made available by the last administration. the regime also greatly tightened the reins on their own country, even recently killing 1,500 people at the many protests that are taking place all throughout iranian the very defective jcpoa expires shortly anyway, and gives iranian a clear and quick path to nuclear breakdown iranian must abandon its nuclear ambitions and end its support for terrorism. the time has come for the united states t-- united kingdom, germany, russia, france and china to recognize this reality. they must now break away from the remnants of the iranian deal

or jcpoa, and we must all work together towards making a deal with iran that makes the world a safer and more peaceful place. we must also make a deal that allows iran to thrive and prosper and take advantage of its enormous untapped potential. iran can be a great country. peace and stability cannot prevail in the middle east as long as iranian continues to foment violence, unrest, hatred and war. the civilized world must send a clear, unified message to the iranian regime your campaign of terror, murder, mayhem will not be tolerated any longer it will not be allowed to go forward. today i am going to ask nato to become much more involved in the

middle east process. over the last three years under my leadership our economy is stronger than ever before and america's achieved energy independence these historic complements shades our strategic priorities. these are accomplishments nobody thought were possible. and options in the middle east became available we are now the number one row deucer producer of oil and natural gas anywhere in the world. we are independent, and we do not need middle east oil the american military has been completely rebuilt under my administration at a cost of $2.5 trillion u.s. armed forces are stronger than ever before our missiles are big, powerful, accurate, lethal and fast. under construction are many hyper sonic missiles

the fact we have this great military and equipment, however, does not mean we have to use it. we do not want to use it america's strength, both military and economic, is the best deterrent three months ago after destroying 100% of isis and its territorial caliphate, we killed the savage leader of isis, al baghdadi, who was responsible for so much death, including the mass beheadings of christians, muslims and all who stood in his way. he was a monster al baghdadi was trying again to rebuild the isis caliphate and failed tens of thousands of isis fighters have been killed or captured during my administration isis is a natural enemy of

iranian. the destruction of isis is good for iran and we should work together on this and other shared priorities. finally to the people and leaders of iran, we want you to have a future and a great future, one that you deserve, one of prosperity at home in harmony with the nations of the world. the united states is ready to embrace peace with all who seek it i want to thank you, and god bless america. thank you very much. thank you. thank you. >> that was the president, not taking questions, opening his statement by saying that iran will never be allowed to obtain a nuclear weapon under his administration he did say no casualties, good

thing for all parties involved that for too long nations have tolerated iran's behavior and those days are over. perhaps the curveball, eamon javers, that not everybody was expecting, asking nato to become more involved in the middle east process. did not get more specific than that but we know his relations with nato have not been always smooth >> that's right, karl. in a message to u.s. allies including germany and the united kingdom, the president wants them to abandon what he calls the remnants of the iran nuclear deal signed under president obama and which this president said was a terrible mistake. the president seems to be taking this moment to push u.s. allies to join with him in his approach, much more hard-line approach to the iranian regime, even as he's signaling peaceful intentions here. the president there highlighting the strength of the u.s. military saying american missiles are big, powerful, lethal and fast but we don't have to use them, highlighting

even that the united states is working on hyper sonic weaponry but suggesting that the united states is pursuing peace here. so two things happening simultaneously one is a message to the iranian regime that the united states wants a peaceful outcome here. and the other one is a message to nato and u.s. allies pthat's the president wants them on board with his approach. so a message as we sawthe president flanked by his brass and top military leadership, very much visually there to show strength of the president's approach as we saw all of those officials gathered around the president to make these remarks >> and as you're speaking, eamon, and on the heels of the president's comments, we're hitting sessions high. dow is up 139. s&p up about half a percent after these comments you also mentioned $2.5 trillion, the tune to which the military has been rebuilt under

his administration that number certainly has been controversial, getting debated a lot in recent days, as he cited it several times but the hypersonic missile piece of this has been a big focus for the department of defense. actually defense stocks right now continue to rally higher, even as we have seen some of the other geopolitically linked asset classes like gold and crude come off as the morning unfolded here. what did you make, though, of the fact he was making a very specific, very blunt message to the leaders of iran, including, by the way, saying that basically the downfall, destruction of isis, would help that country as well as ours >> yes, the president clearly here sending a message to iranian leadership and the iranian people saying the united states respects the iranian people and wants to pursue a path of peace. but also at the same time sort of holding out the carrot and stig approach. the carrot being a peaceful outcome. the stick being saying look what

we just did to the leadership of isis as a reminder, we can continue to do that going forward the president trying to use all elements of state craft here in order to pursue his desired outcome here, which is an iranian government that is now fomenting terror in the middle east, is not pursuing a nuclear weapon >> eamon, thank you for that we're joined this morning as well by ubs director of floor operations art cashin. session highs now of 160 and if you take into account our reaction in futures last night, 600-point swing in the dow. >> certainly big but i think -- initially i think what you had was a lot of ail go ridge nick trading overnight they saw the headlines, iran, aing that, whatever. attack, whatever and the response was clearly disproportional. when more details came out when

it looked like it would be limited, and maybe no casualties, and thankfully it was 23no casualties, that gave people the sense of wait, this confrontation may be rather limited and the markets like that a great deal. oil came back down gold, which had soared, came back down. and now as the president has to some degree defused some of the anxiety so you're getting this, as morgan alluded to, you're getting a little bit of a sigh of relief rally here the fact this confrontation does not look like it's going to heat up again, we'll cross our fingers and hope that. and that's pretty much where we are now. now we look at going back to some of the actual data, the 10/30 release on crude oil shows a mess of products, particularly gasoline

i don't have the data in front of me but by my recollection, this may be one of the largest accumulations of gasoline at this time of year that i can recall so that might put further pressure on oil, and so if the geopolitical tensions ease back, maybe the market could have a little bit of a move. >> i think that's a key point, art. because we have had some data in recent days that's been overshadowed by all of these tensions with iran, whether it is the manufacturing number iran in the lowest of years is this something the market needs to take a closer look at, especially as we go into another jobs report? >> if the geopolitical situation is going to calm down, we're going to get in there. you're going to be hearing more about what are the earnings outlooks as we move along in the year we're at record highs. can we get earnings to justify that right now they look like they will not be much changed from last year.

so we're going to need some help in that sense. >> we're showing charts right now, 24-hour charts of the dow and now 24-hour chart of the s&p 500, which really sort of tells the story in terms of the volatility we've seen as these strikes have played out and the aftermath, commentary, rhetoric, including those comments just a few moments ago from president trump. art, the vix, volatility index, as we have been speaking slipped 13 as well. >> it's amazing even in the midst of all of the tensions, the vix never fully spiked and we're getting to some kind of perhaps new normal where the vix is not only below 15 but as you pointed out below 13, maybe headed below 12. that may hint that maybe investors are a little too relaxed and unconcerned. but for now i think it is a good thermometer for what we are seeing. >> speaking of being relaxed,

this is an s&p all-time now, record high, art after the events of last night, how much of this is complacency or how much is a reflection of the durability of the economy, about employment >> well, you know, i think it is i think not to put politics too far into it, but if the president made the move that he made, which was dramatic and he has managed to get past it without any big negatives, that might enhance his chances for re-election, which for now the market likes they think he's good for business as opposed to some of the other proposals, socialist-type proposals they've seen that's in there. is there some sign of complacency? yes. but you can sit here and reason through the market's actions so far. and it makes sense and the abnormality of the sell-off, as i said, it looked like it was mostly ail go

rhythmics. so the two-legged yeomans are more relaxed than the machines are. >> what do you make of some of the early prints we have been getting of the earnings season walgreens now down 6%. >> walgreens was a bit of a shock. i think people are looking for very small changes in earnings hopefully a little bit better as i say. here we are at record highs. we can't have deteriorating earnings combining to support that why geopolitics remains in the forefront, we're going to have to have the economy kick in and do better and the fed, god love them, don't call it qe but they're shoveling money in, in a very high fashion. even bigger than when they were doing qe. >> so what is left on the plate to digest? we're going to start getting earnings next week we're going to get the chinese

we think signing this text we don't know how specific it will be. what does the market want more, great commentary out of corporates or specificity out of china? >> i think they will look to china and hope to get specificity. lets not -- let us not forget at the end of the month brexit will be coming back in. so we will be moving quickly into the iowa caucuses the election has not been a factor for the market yet because it has no idea who the democratic knowledgeny may be. the more data that we get as we move along, we get past early march when we have super tuesday, those things will become important then as jeff dunlap said last night, if bernie sanders looks like a viable candidate, and so far he

does, the market needs to come to term with that. the markets may be a factor but we have to look past some of the early looks. >> art cassen, thank you for joining us. >> my pleasure we have fresh highs in general for nasdaq and s&ps but oil is at a session low. wti at 4%. john tilda, founding partner at again capital and cnbc contributor joins us now as well as a solutions director at the nasdaq good morning to you both john, i will start with you, the move lower in crude right now, especially given the fact we did have those comments from president trump. we had those inventory numbers here stateside earlier in the morning as well. is there any reason to think it's going anywhere but lower? >> no, not right now, morgan the iran fever has broken in a significant way. we were all wondering if there would be some off-ramp achieved or taken by the various sides.

the iranians took it first with their limited strike president trump just took it now. as a result of that, we have a lot less fear in this market i will tell you too, there wasn't a lot of stomach for this whole situation from either the saudis or israelis either. so with that, with this going forward now, geopolitical tensions have almost -- i don't want to say evaporated, but they have been decimated. >> tamara, i want to get your thoughts as well do you agree >> i don't know we're completely out of the woods yet in that geopolitics could come back at any point but we have suggestion takened a high hurdle in prices so what the market needs to see is disruption to oil supplies that remain in place for a long period for prices to sustain their gain i agree with your guest, unless there's severe escalation, if there's just a contained escalation in an ongoing tit for tat that does not impact supplies, you are not likely to

see upward momentum in oil prices. >> president trump just talked about sanctions again in his remarks this morning in terms of the img papact of sanctions and what that meant to oil supplies in the bigger, broader opec picture and bigger baked in if we are to see sanctions? >> i don't know how much oil we could squeeze from iran from the market but the more near-term worry for me in terms of geopolitics would be what happens to oil supplies in iraq. iraq is producing 4.5 billion barrels a day, very significant production if that were to come down, that would be problematic, but iraq is very much incentivized to continue pumping of course, unfortunately, it is caught in between broader forces at play n terms of iran, i don't see much more upward momentum that that could cause in the market since, to your point, that is mostly baked in. >> hey, john, we didn't expect the president to get more

specific about the imminent threat that the general had in mind, but is the argument now that because he's dead that those -- that threat is gone, that iran will not follow through on ideas they had previously >> very much so. the command in control there, he was very much his own operator and was very much trusted and entrusted by the ayatollah the new replacement won't have the length of the leash that soleimani had. y yes, you have a chance for less activity in terms of the warfare type of activity we still remain subject to the asymmetric risks and as far as iran playing the oil card, they have to be careful with that if it impacts their few friends, china and others in asia, their main customers buying in a subtrifuge manner they risk that that's why that's not

necessarily a high probability outco outcome. it's still the main risk for the oil market but what's happened here today, that's gone down. >> such a key point. i wonder if you think energy structure in the region after those drone attacks a couple of months ago, after what we've seen and the worry, the concern about what air counterstrike from iran, before we got one last night, could look like. whether you think infrastructure in places like saudi, iraq, et cetera, are well enough protected and if not if there will be more demand for those types of protections. >> there absolutely will be. the saudis are buying up whatever they can get their hands on russia, too, is shopping around to anyone who will take a look at it and potentially buy it yes, this is very much a big opportunity for the defense companies that manufacture this stuff. this is the next phase

you heard president trump reference the early warning system that alerted our troops to the incoming fire that's what's being developed more and more on a daily basis and will be deployed more and more over the coming months and years. >> tomorrow, i'm wondering what you think of john's rather dovish reaction to the death of the general soleimani and couple that with what the hawks worry about and that still remains game-changing technology that drones bring, their ability to fly low and take out targets in the ways that they've never been able to in the past. >> that's the point. there's a many number of options on the table critical infrastructure is vulnerable whether iran continues to attack that again or go for an element of surprise or attack by cyber or otherwise remains to be seen. the bet of the market is that they won't tackle energy inextra fra structure because it will hurt their friends and that will be more problematic for them the market, therefore, will

remain on knife's edge we might not move higher from here, but i think some of the recent strength could be sustained as a result of the fact that it could go in any direction. i don't think it's safe to say we're completely out of the woods just yet but we've had a steady escalation in the situation with iran, but it's been in a relatively organized manner as long as we have that, i don't think there's much upward momentum from where we are now >> john, shifting gears just a little bit here. i want to get your thoughts on unexpected crude and gasoline numbers. how worrisome are those for, i guess, petroleum products and pricing as they come inthe season >> certainly not worrisome for america's drivers, morgan. i'll tell you that. >> fair point. consumers love it. >> they're joyful numbers. this is a demand period, after the holiday season, those numbers rival the summer driving

season for a short period of time we'll see inventories rise we're having a terrifically warm winter with more to come in the northeast, 60 degrees over the weekend. demand is low and over-the-truck road demand is low as well they try to reduce inventories to avoid a tax in texas at the end of every year. >> john and tamara, thank you for joining us today. >> thank you. >> with all of that, stocks now at session highs oil at a session low record high on the s&p and the nasdaq that just cracked 90 is,t seems, the other day currently 9135 back in a moment

s&p record highs along with the nasdaq we'll close out this hour with mike santoli, who will talk about how the market is willing to tolerate all kinds of geo political events. >> yes the market will tolerate in the right cadence. we came in this year with the trend being very solid broad rally. cyclical groups are leading the way. everything was in place with a couple of risks. one is, you ran out of things to worry about, to be honest. that was going to be a headwind,

no matter what the question is, was this enough to puncture that sense of optimism and get the market to have a little bit of a short-term gut check in order to make people feel smart, adding risk when they already had enough risk coming into the year i don't know if it did the job, to be honest with you. people are still pretty happy right now. i do wonder if this is just a little bit of relief because you had gotten hedged into this moment longer term, it's hard to say that the rally is not substantiated by super strong credit markets and at least for now the macro and corporate data going the right direction. >> we found ourselves having this conversation again about tina, there is no alternative and fomo, the fear of missing out. >> people find alternatives if they find something legitimate

to be afraid of. they will. treasuries are an alternative but just aren't as attractive when the world doesn't seem as dangerous. >> not much on the tape after the bell tonight bed bath. >> exactly. >> jobs numbers friday after adp crushed it once again. >> absolutely. see if it's predicted this time. >> that does it for us on "squawk alley. let's get to the judge and a half. >> the amazingly resilient u.s. stock market, despite a new level of risk continues to hit new milestones what does that say about where your money will work in the months ahead it is 12:00 noon and this is "the halftime report." investors brushing off rising risks where opportunities are opening up and trade from here. apple and tech in 2020 the number one hardware analyst on the street tells us how to play the big cat names microsoft soaring 50% in the last year and it just goit