has experienced some logistical problems because of the speed at which all of this is happening, but for the main street lending facilities, which will also work through banks, what lessons are you taking away from that? and then more broadly, you know, you mentioned earlier this year that federal debt was on an unsustainable path, and i was just wondering for republicans that are starting to get worried about how much fiscal spending they're having to do in this crisis, you know, whether that should be a concern for them >> so a couple things. this is different from the ppp, paycheck protection program in two ways one is these are not grants. these are loans. so i don't know that the demand will be quite as strong as it has been for the ppp i don't know that, but -- and the second thing is we won't run out of money you know, it's not a limited pot. so there won't be this incentive

to try to get there first and that sort of thing so i'm hopeful we will very much try to learn as much as possible from that facility and from all the other ones too we have a lot to learn here. so we'll certainly be trying to do that. in terms of fiscal concern, so, you know, for many years i've been -- before the fed i have longtime been an advocate for the need for the united states to return a sustainable path from a fiscal perspective at the federal level. we have not been on such a path for some time, which just means that the debt is growing faster than the economy this is not the time to act on those concerns this is the time to use the great fiscal power of the united states to do what we can to support the economy and try to get through this with as little damage to the longer-run productive capacity the economy has possible the time will come, again, and reasonably soon, i think, where

we can think about a long-term way to get our fiscal house in order, and we absolutely need to do that. but this is not the time to be in my personal view, this is not the time to let that concern, which is a very serious concern, but to let that get in the way of us winning this battle, really >> edward lawrence >> thank you, mr. chairman edward lawrence from fox business network given the amount of stimulus on the policy side, how much weight to-do you give for finding a vaccine around treatment or not, the federal reserve pulling back on some of the fed's actions and raising the rates from the zero lower bound? also when does that main street lending facility get deployed? we talked about soon, some businesses are in need now thank you. >> yeah.

so we don't -- we're not in a position to make, you know, a reliable assessment of when a vaccine or a therapeutic drug would be ready, so we're not going to set our policies based on our estimate of that. we're going to just provide the support that we can with the tools that we have and we're going to keep doing that until therecovery is well under way. in terms of main street, so you know the story we put out a term sheet. we got a lot of comments we took those very much to heart. we spent a great deal of time here it's a challenging space because it's many different kinds of borrows. they have different needs, different sizes of companies, and so as i mentioned we're very close to announcing a new term sheet, which will then become operative fairly quickly my guess is, though, we'll keep looking to add products and different kinds of borrowers to that as we go.

and we're well aware of the importance of doing it as quickly as possible. we're very much in touch with the urgency of that need >> okay. don lee. >> it's dom lee from the "l.a. times. i want to follow up on a question on the labor market i know you said that it's highly uncertain, but, you know, there are analyst who is think that we'll have very high unemployment until even the end of next year, as high as 9%. and at this point, can you just talk a little more about what you see the path of employment in the coming months and into next year? >> sure. so unemployment is going to go up to a high number in the second quarter uncertain what the number will be when -- and that's because so much economic activity has been

shuttered really as we take social distancing measures so sometime fairly soon here and probably gradually and at different paces in different parts of the country we'll see the social distancing measures rolled back, people will begin to spend more money. consumer spending has fallen precipitously. and once that starts to happen, people will get hired back and unemployment will go back down i don't think it will get anywhere near the historically low levels that we had as recently as february, 3.5% i think it will take some time for that to happen, for us to get back to anything that resembles maximum employment but, i mean, the main thing we want is we want to get back on that road. we want to get that recovery going and get people back to work as fast as we can, not faster than we can but as fast as we can. the main thing is to get into that stage where the economy is

healing, where we have the disease under control, where we don't, you know, take too much risk of second and third waves and that sort of thing and get people back to work. you know, again, the path of it is highly uncertain, but we will be there with our tools supporting the economy and supporting that recovery >> scott forceley. >> thanks, mr. chairman. after the financial crisis, banks were instructed to up their capital so they could weather an economic shock. what kind of steps do you think we need to take for the economy at large to make it more resilient to this kind of shock? >> can you just say that -- you're a little bit -- low volume >> yes what kind of steps could we take to help the economy as a whole be more resilient to this kind

of exogenous shot? >> it's an extraordinary, extraordinary shock unlike anything certainly that's happened in my lifetime. and a couple things come to mind i think the time will come for careful assessment of the answers to those questions it's early to be asking them we're still putting out the fire we're still trying to win. and i think we'll be at that for a while. you know, but i point to a couple of directions you know, we worked hard to strengthen the banks, much higher levels of capital, liquidity, far greater sense of what the risks are that are running and how to manage them, so the breakdowns that we've seen in market function have really been in the capital markets. and i wouldn't rush in with regulation into the capital markets, and we did plenty of things, a lot of reform in the capital markets, money market

reform, triparty repo reform, central clearing, all these important things, but there will no doubt be with this -- the size and force of this shock will no doubt reveal weaknesses in the financial architecture. and we'll have to go to work on those. i also think, you know, it tells you the importance of getting your fiscal house in order the u.s. really hadn't gotten back to where we needed to get on fiscal policy and, you know, so we have an already high level of debt to gdp and rising quickly when this shock arrived. now, we have the fiscal capacity to deal with it, i believe, but we will need to -- ideally, you would go into an unexpected shock like this with a much stronger fiscal posture.

>> mike mckey. >> mr. chairman, given the demand drop, demand shock and the dropping oil prices, do you anticipate that we might see any kind of deflation even for a very short period that would require a fed response if we get a negative brint on cpi or pce, how should people think about that and second question. there is a disconnect, it appears, between the markets and the economic outlook right now i know you've said this isn't the time to worry about moral hazard, but do you worry with the size of stimulus that you and the congress are putting into the economy there could be financial stability problems as this goes along? >> in terms of inflation, we think that inflation is very

closely and strongly related to inflation expectations and during the global financial crisis, there was a concern that we might see deflation, but it didn't happen. inflation tended to move down a little bit as it will when demand is weak, but inflation expectation did not move strongly down here in the united states they have in other places in the world, though, over the past 25 years. there's been downward pressure on inflation really for several decades now. so i would say as long as inflation expectations remain anchored, then we shouldn't see deflation and the federal reserve is strongly committed to maintaining 2% inflation over time so we'll be there to work on that i think you asked really about that headline inflation. if low energy prices, very low energy prices were to drop headline inflation negative, i would hope that people would see

through that, and we'll be monitoring it carefully, but see through it and look to core, which is a better bre dipredictf inflation. needless to say we'll be keeping close track of that. in terms of the markets, our concern is that they be working. we're not focused on the level of asset prices in particular. it's just markets are trying to price in something that is so uncertain as to be unnoble, which is the path of this virus globally and its effect on the economy. and that's very, very hard to do that's why you see volatility the way it's been, market reacting to things with a lot of volatility but, you know, what we're trying to assure really is that the market is working, the market is assessing risks. lenders are lending. borrowers are borrowing. asset prices are moving in response to events that is really important for everybody including, you know,

the most vulnerable among us, because if markets stop working and credit stops flowing, that's when you see, you know, very sharp negative, even more negative economic outcomes so i think our measures have supported market function pretty well you know, we're going to stay very careful, carefully monitoring that. i think it's been good to see markets working again, particularly the flow of credit in the economy has been a positive thing as businesses have been able to build up their liquidity buffers and households have been able to be home, you know, people have been home concerned about their jobs but not concerned about their financial system collapsing as they were in 2018 and 2009 >> okay. chris from the a.p >> hi, chair powell. thank you. i guess i had two questions. i wanted to start on the

unemployment picture and nail down a little bit how you see things going from here you did talk about potential loss of skills over time so are you worried about structural changes in job markets that would keep unemployment high and therefore potentially beyond the ability of the fed to do anything about, which is something that was debated as you know after the last recession and then eventually of course the unemployment rate did go lower than people thought? and the second question is just on the money from treasury, the $454 billion it sounds like you want to keep that in reserve for programs that have high demand, such as the main street program. are you willing to use that to back stop say a program that is having more losses what's your tolerance for loss among that $454 billion? thank you. >> so in terms of the labor

market, the risk of damage to people's skills and their careers and their lives is a function of time to some extent. so the longer one is unemployed the harder it gets i think, and we've probably all seen this in our lives, harder it is to get back into the workforce and get back to where you were if you ever do get back to where you were so, you know, longer and deeper downturns have left more of a mark generally in that dimension where with the labor force so that's why, as i mentioned, that's why the urgency and doing what we can to prevent that longer-run damage. it doesn't have to be that way we won't be able to limit all of it, but we do have the tools to do what we can to keep people in touch with the labor force and working and also out of insolvency too it doesn't seem fair that people should lose everything they have including their homes over this.

so nevertheless, there will be some of that, but we do some tools to e ameel yameliorate th. so in terms of the money, the $454 billion, it's a couple things first the treasury secretary really has authority over that right? and it stands in front of our losses so, you know, but i do think we are -- we're clearly moving into areas where there is more risk than there has been in the past, and that's okay. i think that's what we're supposed to do this is a very unusual time. in trms of the way to think about that money, i think that's a question for the treasury department we set up the facilities and work very, very closely and

successfully and collaboratively with the treasury on this, but that particular aspect of it falls more to the secretary. >> nancy marshall ginser for the last question. >> nancy marshall ginser with marketplace. chair powell, i'm wondering what you would say to sabre -- saver with the low interest rates. and i'm wondering if you can give us more clues to how long you think we'll have interest rates near zero. >> we think that low interest rates affect the economy through a number of channels in a positive way low interest rates support economic activity through channels overall, through channels that we understand reasonably well. they make it cheaper to borrow

they drive your costs of borrowing down they do raise as et prices including the value of your home or your saveable benefit from a 401(k) but for people who are really just relying on their bank savings account earnings, you know, that's -- you're not going to benefit from low interest rates. but, you know, we have to look out for the overall economy. low interest rates support employment they support economic activity and those are our mandates and i think for the overall good of the economy, low interest rates are a good thing not to say they're good for every single person, but that shouldn't stop us from doing what we think is good for the whole. in terms of how low, i don't want to speculate. you know, we will turn to questions like that soon enough, but in terms of how long we'll stay and under what conditions we'll stay at the effective lower bound, those are just exactly the things we're

thinking about right now we like the place we are. we've said that we'll keep our rate where is we are until we're confident that the economy has weathered the effects of the outbreak and is on track to achieve our goals. so that's where we are we're not changing that guidance today. you know, but it will be -- that means we're going to be very patient. that means we're not going to be in any hurry to move rates up. >> thank you very much >> thanks. >> fed chair jay powell speaking to reporters via video conference saying the fed is there to provide necessary support to support the economy during this unprecedented crisis welcome, everyone, to "the closing bell." i'm sara eisen here with wilfred frost. stocks are higher, just off session highs, as the fed chairman paints a pretty gray picture of what the economy is looking at, characterizes the hit as severe, certainly on

unemployment, on economic growth, on household spending, both in the short and medium term, which is getting a lot of attention. the medium term outlook has the risk that was characterized in the statement. and saying the federal reserve has already put in place extraordinary action to keep markets working, borrowers borrowing, credit flowing, and is prepared to do more and has more tools if needed, trying to send a message of confidence that the fed is here and calling on fiscal authorities to keep working as well to support this economy. >> the fed very much doing what it takes, not an optimistic outlook in any way, shape, or form for the economy we did see a fractional tick-up in the long end of the yield curve in terms of yields, ten-year got up to 0.63%, having been at 0.59% earlier in the session. the dollar did weaken a fraction it was just lower, now down by about 0.3% as you can see there on the yield curve a slight steepening of the yield curve today. either way, we are near the

session highs, still up 600 points plus on the dow the high of the session was 663. 3% gains for the s&p 500, almost 4% for the nasdaq, sara, and the russell up 5.4%, certainly continue a theme of late of those that have underperformed the most year to date. energy 6.7%. >> i would just say i don't think powell said anything that was unexpected in terms of the economic forecast and just how bad it's going to get, what we're looking at we got a preview in today's first quarter gdp number as far as the guidance, he left it vague, open-ended, and said multiple times we're not going to be in any hurry to withdraw the kind of stimulus that we are putting in place here on this economy. so trying to give people confidence also i think, wilf, trying to message around helping households who need it and why the federal reserve is not just

trying to bail out wall street over main street, which is sort of coming up in the narrative now as the fed steps into places it's never been before, for instance, buying riskier corporate debt >> lots to discuss and lots of people to discuss with it. we'll break down all of the headlines from that fed conference with sarah bloom raskin and others. facebook, microsoft, tesla, ebay, qualcomm reporting after the close, which is about 39 minutes away we'll discuss facebook with the cfo, david wehner, shortly after the numbers hit. earnings have mattered over the last couple weeks, a lot of after-hours movers joining us to react to that fed conference and the rally, mike santoli, michelle mayer, head of u.s. economics at bank of america global research, and david zovos, chief market strategist at jeffreys

and cnbc's steve liesman as well steve, i'll start with you you weren't in the room physically but you were metaphorically what was your take-away on the tone we heard there from the fed chair? sara said nothing groundbreakingly new, kind of hard to gauge whether the market needed to be surprised by what he had to say or not >> no, and sara is right for the moment that we're in but it's worthwhile, i think, and i wonder what sara thinks about this, to pinch yourself and remind yourself in the moment that we're in historically, which is a fed chairman out there i was struck, wilf, by the extent to which he talked about the limitations of the fed to bring about a recovery it's simply not up to them limitations on the fed on what it can do in terms of lending and the kind of risk here's his response to my question about is the fed taking enough risk? i'll get back on the other side of that. >> in terms of risk, so, you

know, we operate under the laws that congress passes, and there are a number of aspects under section 13-3 and they permitted us to i think move very quickly and move into areas where we've never been before and do so quite aggressively so i think we're going places and providing help in place where is we never have, and i'm glad that we are i think it's appropriate that we are. >> so he also said earlier, hey, with this main street lending facility, which he suggested is coming relatively soon, if you can't repay that loan, maybe that's not the program for you i thought there was a little bit of a challenge there in the treasury secretary about the amount of risk that maybe needs to be taken to really fund this economy. >> hmm it's an interesting take, steve. however, the federal reserve is doing a lot, and a lot -- i

think there are nine different market programs that the fed has launched, everything from muni debt to mortgage bonds to treasuries to swap lines >> right >> they're certainly doing a lot. i think there's a broader conversation to be had about what all this liquidity does when the economy, yes, we need liquidity right now, but we are spacing the solvency problem as well it only does so much when businesses reopen if they can't pay it back. that's i think going to be the question going forward the fed is trying to sort of bridge i guess some of the pain, but the real problem is the virus and consumer confidence, and when that comes back, that's going to be the question of whether the liquidity works, don't you think? >> yeah. i agree with you completely. and i think it's an interesting metaphor, the liquidity one, because it's liquidity perhaps for people who can't drink it's liquidity for people who can't necessarily borrow these are the places that are the big holes in the recovery

effort right now and i think powell understands that he was very today about the limitations of the fed, and i think we're going to -- this additional money, because i also had a chance to hear secretary that kn mnuchin talk about, this additional pot of money. there will be a debate tomorrow or next week about the amount of risk that needs to be taken with this money for congress. should they go further down to provide more money for the people who need it, not necessarily for those who don't necessarily need it? >> let's bring in some more of the panel. steve, stick with us mike santoli, for you, for what's happening in the markets today, i guess not totally impacted by the fed press conference but we're continuing to see a strong bounce in some of the sectors that have performed most doing well, whether that's energy or banks, both performing strongly today >> yeah. this open-ended perhaps overwhelming unconditional support by the fed i think was the premise of how the markets

had behaved and recovered. they are looki ing toward a momn where the economy can lift themselves out of this, investors collectively lift the economy out of this and start to actually remedy some of these things and perhaps assuming already we're not going to have that big solvency crisis that jay powell was talking about doing everything to avoid. this is kind of a baseline what the fed was talking about today for the markets and right now we're kind of pulling ahead that date when i think the market can try to scale the wall as opposed to wondering exactly how deep we're going in this downturn i say that -- >> did anything, michelle, stand out to you as far as powell indicating how long this is going to last and what it's going to look like from here i'm not sure he knows more than the rest of us, and he said it's highly uncertain, and in fact it's unknowable to predict the

outcome right now. but in terms of how long he'll be using the tools and how big the stimulus programs he'll get will be. >> he said there would be considerable risk that remain for the medium term. he did give some sense of a time dimension here, which is that this is not a v-shaped recovery, not even close there's going to be challenges that remain in the economy from the coronavirus that the fed is going to have to deal with for some time and they are absolutely committed to keeping monetary policy accommodative to ensure that. that speaks to the zero low bound, speaks to commitment for qe and keep the balance sheet large. even on the credit facilities, they'll do mar they want to keep the credit flowing through the financial system into the real economy i interpreted powell to be actually quite dovish and concerned about the outlook and trying to reinforce the fact that the fed stands ready to fight this >> david, if that is, what --

firstly, is that your interpretation as well and would the fed chair have good reason to be fairly dampy given what we saw from gdp this morning, which was down 5% thereabouts, quarter over quarter, when march was only the beginning of the lockdown? >> i think i generally agree with that. i sort of agree with a lot of what sara said at the opening as well, which was he didn't add a lot new here he really reiterated i think what we all new, is there's a massive put. he's put it in every market we've traded in. he's put it into main street more i think the market will test that, of course, and that's a lot of the questions about what steve was going at in terms of are they taking enough risk, putting enough out there, do they need to back stop more things and the markets are debating things about how far they should go into the leverage loan world or legended spaces that's more the topic of the future

but i don't think this meeting really moved the markets very much or perception very much i think we're trading today on optimism about gilead and i think the fed gave you kind of exactly what they were supposed to give, which is we're here, we're big, we can print, we got it we'll make sure that the good stuff is taken care of the stuff that's kind of shaky, we'll venture in there but be careful. >> yeah. using the tools to ensure robust recovery is as bullish as it gets for the federal reserve on top of the gilead data you mentioned and a pretty bullish take from dr. fauci, two people with very high approval ratings right now among not just wall street but americans as well according to some of the recent polling. michelle, another comment that stood out to me from powell which i thought was pretty unusual was he said now is the time to use the great fiscal power of the united states the federal reserve chairman is pretty cautious usually when going this into this realm of

fiscal policy. he mentioned fiscal policy a number of times and even suggested they need to do more and don't need to worry about the debt what do you make of that >> you're 100% -- he caveat that with the monetary policy is different from fiscal policy he made it clear they need to be fighting this fight on both fronts, monetary and on the fiscal front and specifically said more can be done to make sure those that need access to credit get access to credit so that you don't have insolvencies or companies fall under and make it that much harder for the recovery to start once we're at that point on the debt side, he said, look, this is not the time to be thinking about a high debt level. that time will come and he did acknowledge that, you know, one of the lessons learned perhaps in this cycle and environment is that to prepare for the next downturn it would be good to get a fiscal house in order at some time, but that time is not now the time now is to spend >> david, when we consider the

fact that the s&p 500 down 8% or 9% year to date only, the ten-year treasury price is down 67% year to date, where do you stand on the debate that, in fact, those two different indices are agreeing with each other and saying don't fight the fed or whether they are grossly disagreeing with each other in that one is painting a dire outlook for the economy and the other is somehow shrugging it of off? >> i don't buy that. it will help with lower interest rates to investment grade corporates which the fed is also supporting through its funding facilities so you've got good quality corporates that are able to borrow at levels they've never really even contemplated this is hugely stimulative for the s&p, primarily made up of good, high-end, quality companies. i think they go hand in hand

the problem, wilf, and we've written a lot about this at jeffreys in the last week or two, the real issue for the fed i see, and it didn't come up in any of the questions, steve didn't ask it or anybody, is that we get a headline that reads something like s&p at record highs or s&p positive on the year, and we're going through the summer with a 15% to 17% unemployment rate, lit feel a lot like main street got left behind and wall street won the day again. the fed has to be very careful about that, very careful that is a horrible outcome for the economy for the united states and for others. >> i agree that's sort of the question from my old colleague, mike mckey, about this, about the fact that wondering if there are market distortions out there, the fact that the market is sort of ahead of the economic data and there appears to be a mismatch i thought powell's answer was interesting on this, david he said markets are trying to

price in something so uncertain it's unnoble he said they don't care about the market level they care that the markets are functioning, that lenders are lending and borrows are borrowing. so wrap it all up for us if you're sitting at home wondering what does this mean for my portfolio, my 401(k), did powell just reiterate that they'll be in there to buy and the disconnect between the markets and the economy will continue as the economic data gets bleaker to market could go higher because the federal reserve will stay in the game. >> i think, look, the game -- i think you're right, sara like i said, i think there's some danger to it. i think part of the process that i would like to see, i don't know that we're going to see it, is a pivoting of some of the stimulus more toward main street programs and less aggressiveness on wall street programs. everybody was talking about will they buy equities, create an spv, lend and basically allow the fed to put equities on its

balance sheet? i think it would be a big mistake especially with the equity market where it is today. powell did say they're looking at a lot more things for the main street facility, which i thought was positive this is a work in progress for the fed. they haven't ventured into this area as much, never mentioned into this area of main street lending corps but they have a pr issue to manage and i think the put is in. i don't have a problem with the put. the question is do you want to drive it well beyond the strike of the put to the point it's almost not consistent with the solvency fundamentals and it's an overliquefy case of the good quality firms and the economy to the point they just bubble up and you create something that looks a little excessive you have to be very careful of that i'm not sure they'll dweek thtwt the right way. so far they've tweaked it a

little too far to the wall street side, if you ask me >> david zervos in a t-shirt without a haircut, dow up 622 points, michelle meyer and steve liesman, thanks as well. we'll continue the conversation here we'll be right back on the other side of the break. we'll count you down to a huge afternoon of earnings. reports from facebook, microsoft, tesla, and many more. we'll bring you all the key numbers. we'll speak with facebook's cfo as soon as those numbers hit we'll follow this rally into the close.

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22 minutes left in the session. up 622 points on the dow 3.1% higher on the s&p 500, nearly 4% higher on the nasdaq, russell leads the charge, up 11% for the week as a whole. energy top performing sector, utilities the sector in the red. individual movers, shashs hares, a revenue decline of 8% saying it expects this quarter to be worse because of the coronavirus pandemic down 2.6% pseudo lyft laying off about 1,000 employees, 17 person of interest of its workforce and furloughing an additional 288 others reducing base salary for players

exempt from the layoffs and furloughs for a 12-week period this comes as it makes an effort to reduce operating expenses and adjust cash flows amid the covid 19 outbreak. hairs shares up 3.7% >> the fed leaving interest rates unchanged at zero saying they will remain there until there is confidence the economy is back on track sara bloom raskin, former fed governor and paul allen mccully, good afternoon to both of you. sarah, what was your take-away from fed chair powell's pretty tricky communication he had to give >> right so sara, the barn door at the fed is wide open and everything is out the horses are running faster and faster all the tools, some deployed, and essentially what chairman

pow sell saying is he will do whatever it takes to actually get this economy moving again. we know the tools he has work through financial market market , that he can't do anything about getting a vaccine, the plat economic activity, the number of unemployment concerns. that is of much concern. he's done quite a bit. he's got us at the zero lower bound. he has expanded quantitative easing in a way that of course has no time limit, no duration, it has essentially an open-ended quality to it. and then of course we've got these mayor fed liquidity facilities they are all out and they are standing up now and they are essentially, you know -- the faucets are turned on high essentially you see quite a bit here, more to come, i think, in

terms of the main street lending program. we'll also probably see more in terms of the municipal bond facility but you can see him moving all of these different parts and doing things really to an extent that is fairly extraordinary and of course unprecedented. >> paul, clearly the fed chair says he's willing to deliver more if necessary. what portion of his available levers has he pulled 90% or 50% is there much ammunition left? >> i think he's pulled pretty much everything that he can, and i would certainly agree with sara that he's willing to do it with all the vigor he possibly can display. the important thing he brought out, though, and it's really important to pound the table about this, is that there are limits to the fed's power. the fed is not a fiscal

authority. the fed's in the lending business, and they can lend against anything that they deem to be good collateral. they can be incredibly liberal in that mission. but they're not in the grant-making business. and to the extent this economy needs to have grants from the government to households, to business, to state and locals, that has to come through congress and i love -- i think sarah noted when he talked about the great fiscal power of the united states, and he was openly calling on the fiscal authority to give him some equity in order to be able to take more risk so i think he did a really good job of saying, a, we're doing everything we possibly can, but, b, there are limits to what we can do and congress should use its great fiscal power that this great bank of uncle sam that's

been created, which is a joint venture between the fed and the treasury, needs to have more taxpayer dollarsfor grants and loss absorption. >> sarah, i know you're sensitive about this issue you were at the fed during the last crisis where there were questions about who got bailed out and who got relief and what qe did and who it helped and who it didn't. already we're in an environment we're sort of wondering if there's a main street versus wall street thing happening, whether the big companies that the fed is lending to and the markets that the fed has propped up is disproportionately helping the haves instead of the have-nots. i think powell was careful to sort of explain today why his policies, for instance, to help the credit market helped cushion the economic shock that would hurt people at the bottom of the income scale, but will the fed have a bigger problem when it

comes to the unprecedented size of this package and who it's aimed at >> i think you're right, sara. thank you for remembering history in terms of what was done during the financial crisis, which many people will remember did cause quite a bit of political backlash. now, i'm not feeling essentially, you know, the full political backlash at this moment, but you do see signs that it's starting to build and it's precisely for the reasons that you're pointing out the fed is engaged in massive amounts of relief here, and there's different speeds at which this relief is coming out. i think the relief coming from the fed is on one speed, but there's other relief coming through treasury, the small business administration, other agencies of the executive branch, and that relief is hitting all kinds of speed bumps and friction points. and that's an issue because the speed with which this relief hits i think is going to affect

the contours of what our economic recovery looks like when this pandemic is over so there are definitely differential speeds here coming out in terms of, you know, if you think of the water, right, the water in the faucet, some of the pipes are clogged and some of the pipes are moving pretty smoothly and moving the relief to where it needs to be. but ultimately, you know, the bigger point here is that the fed can only do so much. yes, it is an extraordinarily powerful, powerful mechanism, and yet it works through financial markets. ultimately, it is not a good mechanism for actually targeting particular small businesses, particular households, so the ability of the fed mechanisms to actually reach the real economy is still something that we're going to have to see and to the extent we don't see

it or that it's late in coming, i can guarantee you that there will be political backlash here. now, the other thing to keep in mind, of course, is capital markets, right this has been -- this has been a failure really of capital markets, not just financial firms. you wonder at the end of all of this whether the backlash will take the form of some kind of regulatory response because of course the fed is now working in markets that it does not directly regulate. it is buying bonds, buying, you know -- propping up different parts of the market where it does not have explicit oversight. >> sarah and paul, thanks for joining us great discussion we have by the way just 13 minutes left of the session.

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mike santoli here today with josh brown we rallied at to open, have added to those gains all day the federal reserve this afternoon leaving interest rates unchanged at zero. chairman jerome powell weighing in earlier on the fed's plan of action from here >> we're committed to using our full range of tools to support the economy in this challenging time we're going to use them as i mentioned, forcefully, proactivity, and aggressively until we're confident we're solidly on the road to recover

and to even sure thnsure that rl be as large as possible. >> to me today is a day that encapsulates why the market has been so strong, and we've seen this now more than 30% bounce over the last month. we got the hopeful signs from gilead's remdesivir with an added plus from dr. anthony fauci, who sounded for optimistic about that, and you've got the federal reserve, who is already all in and today you heard from fed chair powell that they'll be all in for as long as needed and those two powerful forces have really been hopeful signs for this market. what do you make of the action we're seeing today >> sounds like our work is all done here. everything will work out, happily ever after, right? i think the big thing that changed this week for a lot of people who look at markets technically or look at the internals is what's happening with small caps is absolutely breathtaking we're in the midst of a historic

move in small caps today if they go out where they are now would be six straight days for the russell 2000 of more than 1% gain each day, which is incredibly rare small caps are now 40% off of the lows, a huge comeback. remember, they were hit harder than the s&p in march. and if you actually look at small caps relative to the triple qs which my colleague michael babbitt did yesterday, nay had a two-day outperformance event that you have to go all the way back to march of 2001 to find anything even close so this is important for a couple of reasons, sarah number one, i think you have to think about regional banks when you think about the russell. there's an almost 1-to-1 correlation, russell value versus the kre, the regional bank index, that is precisely the area of the market we want to see enthusiasm for. and i think funneling another $300 billion worth of small business loans, many of which

will go through regional and smaller banks this time, is probably helping those stocks. that is what you want to see if we're really going to have a recovery and it's going to get under way soon it's going to happen with banks being able to make loans, being able to borrow imhappy to report that i think it's not getting enough attention on the air today people should think about smaller companies being a big part of the rally. >> alphabet, facebook, microsoft, all up 4% or more today. that's all around earnings, two of which are coming at the close today. first let's touch on that other positive stimulus point for the market today, gilead shares rallying on new hopes for its potential coronavirus treatment. meg tirrell has the details. >> we got the nih's results that

everyone was waiting for because they were the gold standard placebo-controlled trial and came a month early they showed the drug accelerated the recovery time for patients this is not a cure but patients on remdesivir recovered from their illness in the hospital around 11 days as median versus 15 days for placebo. it also showed a trend toward saving people's lives. 8% of those on remdesivir passed away versus 11% on placebo however, that was not statistically significant. "the new york times" is reporting that the fda plans to potentially use -- authorize this for emergency use as soon as today, guys so this is not a cure as dr. anthony fauci said but it is a building block, the first drug to work for this disease back to you. >> meg, thanks very much for that mike santoli, the obvious debate point is this is not a vaccine, it doesn't necessarily drastically change people's

economic behavior. it is potentially an aid when it comes to treating people that have the disease and it doesn't really alter where we're going to be going back to sports stadiums or movie theaters anytime soon. >> the market is not interested in the nuances necessarily to be honest with you. for the purposes of right now, investors are kind of seizing on any incremental news that we can draw the reopening of the economy sooner than we thought a little while ago so i totally agree with you, but for the purposes of the cover story for what this market the up to right now, the gilead news was fine and i do think that you can't have this kind of rally. josh was talking about it too. you have to have extreme caution to set it up thisrally has started to seem like a bit of a chase. they've been grab by, a gap higher five or six straight days in the s&p 500 it does seem as if there's a lot of positioning, maneuvering going on as people kind of assimilate this idea that maybe we weren't looking in the right

places for exactly how we can look across this this is a collective bet the market is making it could be proven wrong we're getting up to levels where it will have to prove lot more but that's what's been going on to this point. >> i'm not sure aagree with you, wilfred. i get it's not a vaccine and therefore it won't create immunity and it's definitely not a cure, but anything incremental to get consumers more confident from the place they are right now, which we saw a record drop in consumer confidence, hearing about drugs that are out there that can actually improve your chances of staying outside the icu or not coming close to death i think are important psychologically, especially if we hear the backing from people like dr. anthony fauci, who is all over the public spear abohet going out and taking the first steps into a restaurant or a retailer it's not just gilead's remdesivir for serious patients. there are hundreds of other drugs that at least are being

looked at, anti-inflammatoriean, anti-arthritis and it helps incrementally improve i think the confidence in the absence of the vaccine, which is going to take a lot longer. >> of course incremental absolutely the key word for me i think we're both sort of along the same lines it depends on how you put a spin on it, but a 12% possible death rate changing to 8% is not the drastic change that would alter behavior in a huge way i think it's certainly marginally positive. again, you come back to the point, josh brown, that the economy declined about 5% quarter on quarter in the first quarter of the year when we only were in lockdown for a couple of weeks. we have a large amount of bad news to come through even with behavi behavior >> it get worse. this is a discussion we had with clients this week. we put out a letter to clients

asking the number one question they were asking the financial advisers at the firm, which is how the hell, excuse me, is the stock market down 11%, 12%, 13% give chb what i'm seeing in my hometown, giving my stories i'm hearing about people losing their businesses, their jobs, how does any of this make any sense? we gave a couple answers but the main one is there doesn't tend to be a linear connection in terms of depth with what the stock market and the economy go through first and foremost in the '07-'09 crisis, gdp contracted 5% but the s&p 500 was cut down does that mean we should be down 90% if we're seeing a quarterly gdp for q2 about to fall 30% or 40%? it doesn't work that way that's one and lastly, we had these dramatic reactions in the stock

market on the way down already so i just think, like, people should think about this in totality, not one versus the other. >> all right up more than 500 on the dow, off session highs. mike, what else are you seeing in the market internals today? looks like a lot of the losers are coming out on top. >> that's been a trend, sara, continuing today but not nearly at the expense of the winners breadth is strong. take a look at the equal weighted consumer discretionary this week against amazon, by far the largest weight in that, you see the troops are working here, the generals are taking a back seat and the volatility index receding once again, not normal levels but it's cooperating to a degree down in the low 30s >> 30 seconds left in the session. we're up by 50 on the dow. the high of the session was up 660, nonetheless a 2.3% gain nasdaq 3.6%.

the russell up a healthy 4.9%. energy the best performing sector today followed by communication services, up 5%. the bell is ringing. so we are higher by 2.7% on the s&p 500 for the week as a whole, up 3.6%, the russell 2000 the winner, up 5% today over 1% for the week so far. >> the dow closing at its highest level since march 10 president. welcome back i'm sara eisen with wilfred frost along with mike santoli. a strong session on wall street propelled by some good results from gilead's remdesivir drug to fight the coronavirus and also from fed chair powell helping fuel the rally late in the afternoon, saying the federal reserve is in no hurry to withdraw any of the stimulus and remains there to provide more. there's the dow finishing up

2.2% the s&p 500 ending with a gain of about 2.66% we were up more than 3% a few minutes ago. but it was broad as we mentioned, it included some of the stocks that have been harde eest hit. communication services strong. the banks also continuing to rebound, materials, consumer discretionary the only two groups down were defensives like utilities. and the russell 2000 index, small caps continuing its own recovery it's been the loser all year long and has had some pretty strong gains as josh brown was telling us in the last few sessions today no exception, up nearly 5% coming up, another huge after-hours earnings session for you featuring results from not just facebook but also microsoft, tesla, qualcomm, and ebay then we'll speak with facebook's cfo about the latest results and how digital ad sales are faring

amid the coronavirus crisis. also this hour, president trump set to meet with industry exec tifr -- executives at the white house. we will monitor it for you and bring you news and highlights. first the markets. josh brown is here mike, the strong rally what you noticed inside and the cat list that got us here. >> certainly very strong seemed like a little bit of a grab and a chase and people's feelings squeezed and forced in because the rally was not letting people in at a decent dip. we had a 5% pause like early last week and that was about it. that being said, got the s&p up to a level in this broad rally where we first peaked in the summer of 2019 and we were at almost exactly there one calendar year ago as well. got back 60% getting into may it would make all the sense in the world to see this flatten out or pull back i've said that before during this rally i would just put that out on the

radar. today seemed as if almost kind of a capitulation of abundance of good news market does best when it can basically go from bad, bad news to less bad news and when the fed seems to be giving more support than needed. i think both things were top of mind today in the rally. >> josh, i know we've seen a great run for the likes of the russell, the likes of the regional banks in the last couple sessions. but is there still room regardless of what the overall pack does, room for there to be a closing and narrowing of the gap between the big tech outperformers and the banks and small performers >> there's always room and anything can happen. if fundamentals of large cap tech are significantly better. i don't understand a scenario where that would change on a dime what could change? sentiment around what will look bet err yeter a year from now. if a lot of money starts thinking, you know what, i get it, google is doing great,

facebook is doing great, but what's next? if that mentality takes over, you should see that gap narrow more >> starting to get some earnings out. jon fortt has the numbers. >> those numbers just out. the revenue has come in at $5.2 billion versus $5.038 billion. those numbers better than expected also the guide is to $4.4 billion to $5.2 billion in fiscal q3 and between 60 and 80 cents in earnings per share for fiscal q3. msn chip shipment, a measure of the overall health and volume mainly of the smartphone business glo globa globally, thr

came in below the midpoint, the range qualcomm gave last quarter before we knew this coronavirus crisis was spreading worldwide they gave 125 million to 145 million units. let me go through the detail on the quarter now. i did just get off the phone with qualcomm's ceo steve and the cfo before the call. they had some very interesting detail on the quarter. for one, they managed to sign two chinese licenseees to 5g agreements, which is important malikov told me china is well on its way to recovery after its dealing with coronavirus, so that's part of the reason why long term he says he sees no fundamental change in the desire globally for 5g. qualcomm is maintaining its 5g handset estimate for the year of

175 million to 225 million units in calendar year 2020. i asked him if he expects to see a delay in 5g infrastructure rollout because of countries on lockdown he said not a big impact, that there hasn't been a big change in intensity overall, china has been more intense in building out, there has been some impact in europe. he did say also that he expects to see some improvement in things as we exit june that's part of what gave him the confidence to give the guidance he did he said, and this is important as people are looking forward to oems like apples and others, will they release handsets, he said by and large, people are trying to stick to the schedules, oems, new smartphones by the end of the year, especially the chinese back to you. >> the stork is up 5% after hours.

microsoft is also soaring here after hours. looks like a big beat. let's get to the earnings with josh lipton. josh >> microsoft reporting q3 earnings of $1.40, versus expectations of $1.26 and revenue of $35 billion versus expectations of $33.7 billion. so beats there on the bottom and the top. turning to the segments here, revenue and productivity and business processes, $11.7 billion in the quarter, ab an increase of 15%. office 365 commercial revenue growth 25%, linkedin revenue increased 21%. cloud division was $12.3 billion, an increase of 27%. its cloud service azure saw revenue growth of 59%. of course there microsoft going head to head with amazon's aws and revenue and more personal computing, $11 billion, an increase of 3% windows oem revenue, what device makers are paying microsoft to license windows, that was

relatively unchanged year over year back to you. >> josh lipton, thanks so much for that microsoft up 1.4%. let's get to facebook's numbers. revenues a smigt beat, $17.7 billion, the forecast $17.4 billion, the eps coming in at $171 billion, the forecast $175 billion. you are seeing a slight uptick in engagement relative to expectations daily active users 1.73 billion, the forecast 1.7 billion, equating to an uptick of about 9.3% year over year. last quarter was an 8.8% uptick. monthly active users 2.6 billion, the forecast was 2.5 billion, an uptick of about the same as last quarter, about 7.5% in terms of the ad revenue, the number directly related to advertising, that's held up well you have engagement up but advertising revenue doing all right.

17.4 billion, the forecast was 17.3 billion that's up 17% year over year last quarter was up 25% year over year for ad spend but still up 17% in this environment is not bad at all head count up to 48,000. it was 45,000 at the end of the last quarter decent set of numbers. a pretty strong 24 hours for facebook stock you have more on these numbers >> it's important to look at the guidance facebook does not traditionally give guidance in the earnings report but they're changing that, including a section on the impact of covid-19 on their outlook. they're saying we are facing a period of unprecedented uncertainty in our business outlook. they expect business performance will be impacted by issues beyond their control including the shelter in place orders. in terms of engagement, they

expect this better-than-expected engagement to continue they say they're seeing the daily active users as well as their family of apps reflect increased engagement and expect they'll lose some of that when various restrictions are relaxed in the future. strong now but it won't necessarily last they're also sayi ining they experience a significant reduction in the demand for advertising as well as related decline in the pricing of their ads over the last three weeks in the first quarter so they're not providing specific revenue guidance but looking at snapshot, what they're seeing so far. they do say expenses will decline. back over to you >> julia, we'll get back to you in just a bit. first reaction josh brown, 3 for 3. there was all this anxiety going into this earnings season about advertising in a recession when customers would be pulling back and snap, google and facebook had better than expected numbers and positive share price

reaction >> we knew engagement would be way up literally who else would people be doing what we didn't know was one, would advertisers continue to spend at the same right, and, two, could you get the same amount for the same amount of add load on some of the apps and the answer from facebook's perspective, it seems a little bit wishy-washy, google was a little more confident. i think youtube ad revenues were up 33% or something like that. then let me just touch on microsoft really quickly when people talk about these stocks being pumped up by the index, this is a company that just told you it beat on top and bottom line and the business was unaffected by a global pandemic. that's why it's a trillion-dollar stock, not because i put money into a van guard fund let's relax with the causation correlation here facebook is the fourth largest

stock in the world and google is sixth, microsoft is one. there is a reason. look at the degree to which these companies are doing what they're doing in literally a global shutdown with a third of the population stuck inside their homes. it's not an accident it's not the fed manipulating. it's business fundamentals being incredible all of these names i don't facebook but i own alphabet >> mike, what's your take so far on some of the big tech names? facebook adding to huge gains in the actual session, up over 10% now for the last 24 hours. >> we have to be clear, there was some anxiety about the ad picture built into facebook. it did underperform the likes of amazon it was supposed to earn 190 two months ago this quarter and got revised under 170 and beat that. all that makes sense we basically preloaded the anxiety, stock is down fairly significantly off its high, rebuilding that because of the

rebuilding of the business is on display and people are willing to bet there isn't a lasting hiccup in terms of the overall outlet plus expenses, a different part of the story too. >> i just want to get in here to mike's point >> microsoft and facebook. go ahead, josh >> makemakes a really good point. pull the lens back and you'll see that google is only up 6% the last year, facebook up 2%. the xlk, the broader tech sector, is up 20%. so i think that's right. there were already concerns about growth rates for these companies br tefore the pandemic they've both underperformed their space. i think even though they beat slightly lowered guidance or they're a little wishy-washy, it's enough for the stocks to justify the rally they've had in the last few weeks >> i was going to get the tesla numbers and get back to be facebook tesla coming in with a slight beat on each line, revenue $6

billion, forecast was $5.9 billion. they've updated stronger than expected delivery ies for the first quarter. we'll have to look at expectation of deliveries for q2 the eps beat on the bottom line, $1.24 adjusted compared to an expectation of a slight loss of 36 cents, looks strong, revenues slightly ahead sara >> all right let's hit facebook again, which is soaring after hours we'll get back to tesla after a while. this is a crazy earnings session so far julia boorstin is back with us along with a special guest, facebook cfo david wehner. julia, take it away. >> dave, thanks for joining us before your earnings call. we appreciate it >> thanks, julia let me start by saying that our thoughts are with those facing challenges right now >> so i want to hone in on what you're seeing right now in terms

of revenue you report there was a pretty steep decline at the end of march but in april things seemed to be stabilizing. what's happening with facebook's advertising right now? >> i think you can see that in our results, julia, we're not immune from this crisis. we did see a steep decline in advertising revenue starting at about the first week of march, and that sort of continued we've seen more recent stabilization as part of the earnings release we did include information about the first three weeks of advertising performance in q2, so in april. and that's about flat year over year versus the performance in 2019 >> so to have a stabilization, though, does that indicate to you that things will start to turn around by the end of this quarter into next quarter? what's your outlook going forward? >> i think the outlook here is really uncertain that's why we're not providing

guidance we're giving the day that that we have up through the first three weeks. we know that economists are calling broadly for a gdp contraction in q2. that's pretty substantial globally we know that advertising tends to be very sensitive to the macroeconomic climate. we're really -- you know, have a very cautious outlook on how things are going to develop. >> now you have both small businesses on your platform and the biggest brands in the world. what trends are you seeing especially when it comes to small business i know you've made various efforts to help small businesses right now. are you seeing them fall off a cliff or stop advertising complete completely >> no. we're seeing advertising pull back but even across large and small businesses we know that this economy isn hitting small businesses particularly hard but there are some going after online conversion outcomes, whether it be app installs or e-commerce

transactions so, you know, we're seeing strengthening in those sorts of verticals, true for small and large businesses >> are you making any changes now to sort of take all these areas that increase engagement, whether it's more video calls or people live streaming on instagram? are you going to be introduce new ways to monetize that? because a lot of these areas with the biggest spikes in engagement aren't being monetized very much right now. >> first of all, we're gratified that our products are helping people as they shelter in place. that's really important for us we're seeing that with people engaging with facebook live. i've done exercise classes on facebook live. people are using our portal products i use it to connect with my parents. i think we're seeing a ton of enga engagement we'll see. obviously if shelter in place restrictions come off and we're looking forward to that like everyone, we'll probably see

some of this engagement fall off. but overall we're seeing a lot of engagement across our services, many of which have advertising. facebook feed is doing well, instagram is doing well. i think we have a lot of opportunities from a supply of advertising inventory point of view to grow the business. but demand is of course very weak in this economic climate. >> certainly now i want to get your sense of expenses you reported that expenses in the quarter were on the lower end of expectations, also going forward, operating expenses are not going to be as high as you previously forecast. give us a little sense of why that is and where you see the expenses actually shifting if they are shifting as a result of this crisis. >> sure. so, you know, we're maintaining a strong but more focused investment program so we're continuing to invest heavily in product development and recruiting technical talent, so we talked about adding 10,000 people in the workforce in those

areas. we the we'll realize in travel and marketing. in addition, we'll see slower head count growth in our business functions overall we did bring down our expense guidance range for 2020 by about $2 billion. >> david, it's sara eisen here for years, at least the last year, probably more than that, the headlines and the narrative around facebook have been around privacy concerns and fake news, toxic content, and legislation, investigations to what extent are you guys inside the company seeing this as a moment to really pivot and convince the public that you're an essential tool for bringing information about the outbreak and connecting people to each other that could have a longer lasting impact on your company >> well, we know there's a real need here and a real opportunity for us to focus on how we can

help in the covid crisis we think of the three things we can do there first and foremost, people need to stay connected to the people they care about. we have 3 million people using our services second we are helping the public health response. we connected over 2 billion people to our covid information center on facebook third, we think we can play a role in helping small businesses and the economy recover. we made our own -- we announced that we're putting $100 million of grants towards small businesses as part of that but more importantly helping small businesses be able to have a presence online and connect with people, drive online conversions where they may have been doing in-store sales, for example. people use the platform but as well as for businesses >> david, i wanted to ask about messenger rooms. all of us are using video conferencing apps much more than we have done in the past there have been some questions

with some rivals of yours about security with some of those calls. how confident are you about the security of facebook messenger rooms? and what can you tell us about your approach to privacy and whether there will be in any way analysis of what is being said, whether that's by algorithms or anything else or a.i. at facebook >> ya. we don't listen in to calls and monitor things like tra in a privacy perspective, wilfred, so really what we're focused on doing here is expanding our free video calling options that we've had for a number of years on both messenger and whats app, so messenger room we're excited about. it's a great way for people to engage and i think it's especially timely in this crisis then on whatsapp we've expanded the number of people you can have in a video call from four to eight we think that's really important right now. facebook live, you know, doing great.

it's got 800 million people engaging, watching facebook live stream so, you know, we're really excited about the different, you know, video offerings and the expansion of, you know, the video presence offerings that we have with things like messenger rooms. >> david, as we try to figure out how we're going to open up these economies and the path forward, one o key rfeatures we need is contact tracing. how are you guys thinking about that at facebook with so many americans and people around the world on facebook? can you be a part of this or do you worry about the prove se implications of that, letting people -- identifying people who have the virus and letting people who have had contact with them around them know they've been exposed >> sara, we're focused on where we really think we can add value from a public health response point of view and there again i'd point to the work we're doing to connect people with information. the covid information center is

part of that there's other places we can make a contribution as well but that's the focus that we have >> one question i have, as you think about the work you're doing around covid but also around your own workforce -- facebook was one of the first companies to have its employees work from home how are you seeing this changing the way your employees work going forward? do you think that you'll be bringing fewer people into the office does it change the way you treat some of these huge headquarters buildings that you've been investing so much in >> well, we don't know the answer in the long run, but i will say we have of 95% of our employees working from home in this environment so we've got a small amount of staff having to go into data centers and the offices and the focus is obviously on safety. what we've been pleased with is our ability to continue to operate in this environment. we're able to ship products. we're able to stay in touch with

our business customers we're able to operate the business, review content we think we're doing relatively well from an operations perspective in this work-from-home environment we'll be more cautious as we bring people back into the office as well, so we're going to make sure that, you know, we have a paced approach to that and obviously we want to make sure that, you know, the shared resources out there in terms of transportation infrastructure are for those essential worker who is need to get to their jobs if we're able to do our work from home, we'll be probably slower to roll back in >> dave, final question about facebook's recent $5.7 billion in india's reliance geo. tell us about how this investment reflects your interest in emerging markets and where you see future revenue growth coming from >> absolutely, julia india is just an incredibly important market for us, one of our top growth countries for a number of years, our largest monthly active user country.

india is right at the center of the long-term opportunities for facebook and the whole family and obviously whatsapp is an important part of that as well in india we're excited to be partnered with geoplatforms, with reliance geo has been an incredible story about bringing digital opportunity to people of india it's great to be partnered with them we think there's a lot we can do with whats app and geo and india. so we're very excited about that we were able to make that investment even in this tough economic climate because of the strong balance sheet we had. so we're really pleased to be able to move forward with it >> great, dave thank you so much. >> we'll let you get off to -- thanks, dave >> all right thank you. >> thank you, julia boorstin >> facebook up 9% after hours, adding to the 6% gain today. extraordinary move let's get another set of p

results or a deeper dive into them tesla's numbers. phil lebeau. >> the reason the stock is moving higher is coming in with a profit when many were expecting a loss $1.24 a share. the estimate was a loss of 36 cents a share. tesla estimates are all over the place. they always report their quarterly deliveries in advance and it came in as expected we knew this was going to be the case just under 89,000 vehicles delivered in the first quarter no change in the production guidance from tesla, which is a bit of a relief. i think some people thought perhaps they might dial back their expectations a bit, but that is not the case in terms of their cash on hand, they increased it by $1.8 billion. they had a capital raise during the quarter, now have $8.1 billion in terms of cash on hand, automotive margins, 25.5%. you have to near-term profit guidance being put on gold now, some people will look at

this and say makes sense given everything going on with coronavirus. i'm not sure it will have a whole lot of impact on tesla shares after hours finally the tesla semi, that truck that was expected, first deliveries this year, that's going to be pushed out until 2021 again, that's why you have tesla moving higher. overall at first blush this will be better than many investors expected as always with tesla, it's the earnings call that moves the stock and that will be starting at 6:30 eastern time with elon musk we'll be on that call and let you know tomorrow morninging what news if any comes out of that call. >> for now, big shooting higher move to the stock, up 7.4% phil, thanks deirdre bosa has earnings. deirdre? >> a beat on the top and bottom line, revenue coming in at $2.73 billion, high than what was expected earnings per share beating by

feve cents coming in at 77 cents a share. gross merchandising volume, the estimate was $2.34 billion, that's coming in nearly a billion dollars higher keep in mind, though, this number shrunk in twintd and it's expected to decline this year. looking at the forecast, better than expected for both q2 and the full-year guidance, so that is positive. in terms of capital allocation, share repurchase plan will be completed later this year. the cash dividend is also intact on covid, some generic comments from management saying their strong balance sheet and stable cash flow gives them strength and flexibility in a tough economic environment shares initially down by nearly 4%, now down by less than 1% it may be because this quarter didn't really tell us anything new from ebay. we know it's been under pressure

from activist investors, trying to shed more asset the stock hasn't done much compared to amazon and shopify, looks to be more of the same shares up about 8% year to date. you can tell they're not reacting much, down a little bit lower in the after-hours despite beating on the top and bottom line >> thanks for that and josh brown for joining us today tesla, microsoft, facebook all markedly higher. up next, much more analysis of those movers with various analysts joining us. you can always watch or stlien to us live on the go on the cnbc app.

time for a coronavirus update with seema mody >> let's start on that death toll the u.s. death toll from the coronavirus has gone above 60,000, the number of fatalities doubling in the last two weeks even though the rate of new deaths is slowing in hotspots like new york. in washington, house speaker nancy pelosi says democrats are not likely to go along with senate majority leader mitch mcconnell's efforts to get virus

liability immunity for businesses to make them less fearful about reopening. and roger goodell told league employees to expect fur loys and salary reductions according to a memo seen by cnbc. he's giving up his salary for now. volkswagen is postponing plans for production and norwegian cruise line furloughing 20% of its workforce through the end of july. last week norwegian cruise line canceled all of its cruises through the end of june. cnbc confirmed last week it was also using the help of goldman sachs to explore financing options. as always, for more coronavirus coverage, head to cnbc.com sara >> thank you new hopes for gilead's potential coronavirus treatment helping that stock and the overall market rally today meg tirrell has the details. meg? >> this was a trial we didn't

expect the results from until next month but they came in early. dr. anthony fauci saying that they have a responsibility, an ethical responsibility if a trial is positive for the drug, to tell the placebo patients that the drug is working here's what the trial showed it enrolled more than 1,000 patients who were hospitalized what the drug did was accelerate the patients' time to recovery they showed on average for the drug group, who got remdesivir, a recovery of about 11 days versus 15 days for those on placebo. there was also a trend toward a mortality benefit, meaning the drug could potentially save lives. i say a trend because it was not statistically significant but it showed patients on remdesivir, there were 8% who passed away in the trial versus 11.6% on remdesivir dr. anthony fauci, as he disclosed the results from the oval office today say, quote, the data showing remdesivir has a clear-cut significant positive

effect in the recovery time. the fda may issue an emergency use authorization as soon as today for this drug. moving at just unprecedented speed, sara and wilf >> i think what's interesting, first, meg, what does the fda approval then mean does that mean that they can produce more, that it can get to more hospitals what does that allow it to do? >> it essentially allows doctors to prescribe it and not have to go through the expanded access program to get it from gilead. it just makes the drug more widely available in terps of manufacturing, gilead has already started working to speed that up and to ramp it up and supply is going to be a big question here. they've said they can supply about 140,000 doses by the end of may but that's at a ten-day course what they also show today in gilead's own trial is a five-day course may work just as well, so that would double the supply of this drug, guys. >> meg tirrell, thanks for that.

still to come on "the closing bell," back to the after-hours movers, facebook a significant gain already in the actual session today up about 6% in normal session microsoft, tesla, qualcomm all moving higher too.

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shares of microsoft moving higher after reporting its q3 earnings beating on both the top and bottom lines, revenue up 15%, one of the stocks continuing to pound the rally. alphab alphabet, facebook, microsoft are higher for the year, going against the market there joining us to break down the numbers is timothy horan from

oppenheimer. expectations were high going into this report microsoft exceeded them. how? >> it's all because of their hybrid cloud strategy. they're in the perfect position to help enterprises move to the cloud and that's important for enterprises right now because it's great for disaster recovery, enables employees to work better, suppliers, customers because you're moving our i.t. to a centralized cloud and can access it much more easily from remote locations they make it easy for cios to do this >> more than just a short-term benefit for some of these cloud-related companies with more people working from home and getting on the internet. the ability of working from home, the ability to reduce. >> absolutely. what microsoft said in their press release, they saw two

years worth of cloud adoption in two months this is really a service recurring business model so the sales they saw now will continue to pile on over the next kind of couple of quarters so they should have a very few good quarters ahead of them and frankly longer term. we also surprisingly saw quite a bit of leverage in the mod they will quarter despite all the disruption i think we're going to see a lot more of that over the next couple quarters baud it's difficult for microsoft to spend anywhere near the level they're seeing on the revenue growth and basically have the infrastructure in place that's highly scaleable with massive amounts of operating leverage. >> mike santoli in the conversation as well mike, this was one of the outperformers. the fact it's gone positive for the year 2020 shows you about where the market thinks the stock has been and the fact these numbers just proved it there's a line in the press release that says covid-19 had

very little impact on our revenues you don't see that across many companies right now. >> what's probably surprising to most people, the largest stock in the market after hours is trading only 4% below its all-time high a couple months ago and that all-time high for microsoft represented a pretty high valuation relative to its own history, the can't lose, everybody loves it, bulletproof stock. that tells you the macro picture and the broader market this company is and, you know, you don't want to say that somehow the market is being too optimistic here because it is keying offer of what's happening in the business and with a view to what might or what might change. seems not like that much has changed. >> the stock is up about 15% year to date what are you going to be looking for on the call and how will it inform what your current recommendation on the stock is, what is what >> we have a sector outperform

on the stock with a $195 price target the call was critical. we're looking for body language, for guidance from the second quarter, and that body language and guidance will dictate what happens to the stock tomorrow. they have some businesses that could potentially be under pressure, a little bit of advertising revenue, they sell hardware to consumers, linkedin could see a bit of a slowdown. i think they'll be cautious on the guidance but they can only be so cautious versus the results. they just beat earnings by 10% on a wildly volatile stock we think what they've said on two years worth of cloud sales in two months, this will build up with strong revenue i'm sure they'll be cautious but not enough to reduce the stock price. >> do they give -- it doesn't look like there's any guidance in the release are you expecting to hear that on the call?

any chance they pull guidance like so many other companies are doing? what would that say about where they are >> they said in the release they'll give it on the call. they always do if they were to going to pull it, they would put it in the release so we don't expect that. >> timothy horan, thank you for join us. >> up next, breaking down the numbers, tesla shares reporting. since 1926, nationwide has been on your side. we've been there in person, during trying times. today, being on your side means staying home... "nationwide office of customer advocacy." ...but we can still support you and the heroes who are with you. we're giving refunds on auto insurance premiums, assisting customers with financial hardships, and our foundation is contributing millions of dollars to charities helping with covid-19 relief. keeping our promise to be on your side.

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let's have a check on some of the biggest movers after hours. as we've been discussing microsoft up 4%, topping on both lines, facebook up 9.5%, beating, again, both lines and monthly active users and daily active users always showing a decent engagement. the eps line for facebook a slight miss. ebay topping estimates and issuing a strong guidance.

tesla also both lines including a big profit beat on the bottom line as you can see, ebay down about 1% >> it's been a positive session for after-hours earnings we have breaking news on exxon dom chu. >> they were up a percent after hours after gathering about 5.5% in the regular session because they've declared a quart ily dividend of 87 cents per share, so they did not cut it for a stock that's seen a decline on falling oil price. this move by exxon not a cut on maintaining their dividend back to you. >> dom, thanks very much for that tesla shares as we said jumping about 8% or 9% after hours, posting adjusted eps $124. joining us to break down the

numbers, jed, thanks for joining us currently the bottom line is what people are focusing on. >> yeah. it's the bottom line and the commentary around guidance, the specific commentary that they'll still deliver over 500,000 vehicles so there's a lot of moving parts to this one, but net-net, i think that's what's driving the stock higher >> what did we learn about cash flow, jed? always important with this one >> that's going to be the big question and we're going to need to call to kind of dig into that the free cash flow was i think just under a billion dollars and they've got $8 billion in cash on the books right now it looks like they're well positioned, but what we need to figure out is you only have shanghai operating, and so we need to understand the carrying cost of fremont, which is shuttered right now i think that's going to be the key investor question. >> q1 deliveries were strong

we got an update on that a few weeks back it doesn't look like they're having to reduce estimates for q2 deliveries. if they deliver on that, is that better than you would expect >> yeah. we moved to a hold on the name in february, february 6th, on the covid impact at that time, it was still china related. so i think if they're able to do over 500,000 with fremont being shut down for the better part of a quarter, that would certainly be better than expectations. again, we're going to have to dig through a lot of this and we need to see when the economy reopens what people's appetite is going to be for buying vehicles >> yeah, i was just going to ask, you know, tesla, during a recession, are there going to be demand questions >> certainly i mean, i think ihs, one of the other market research firms, is

projecting auto sales to be down by 50% in north america. so i think tesla's better positioned being on the, you know, electric vehicles and where things are -- they're better positioned in the marketplace because they're part of the solution going forward and not a gm or one of those companies. but that being said, you're still going to have -- i mean, people aren't, you know, sheltering in place right now wondering about, you know, should i buy a model 3 or a model s? or i don't think most people are. so we need to see how that plays into the picture >> jeff, thanks so much for joinings us. we appreciate it. >> thanks for having me. >> breaking news on boeing phil lebeau has it >> s&p is cutting the credit rating for boeing from bbb to bbb-minus. that is the last notch of investment grade so it's not been knocked down to junk

status, still investment grade the outlook is stable. we're waiting for the full report from s&p so we can tell you exactly what they have to say here, not a lot of reaction on the stock s&p cutting the investment rating for boeing from bbb to bbb-minus. back to you. bbb minus, back to you >> i know you spoke to the ceo of boeing this morning on "squawk on the street. did he confirm anything whether they would go to the debt markets versus the government? >> i know he was reluctant to say, but i know this comes into question the rating when it comes to the bond market and whether they'll have to raise a bunch of cash. >> well, it certainly will have some type of an impact how much it's going to be remains to be seen they look to tap the public markets and that doesn't mean they'll close off any thought of working with treasury and taking off potentially alone from the federal government i think the key there, sarah is they want to know exactly what the terms will be with any money that they take from the treasury

department and they've said this all along. they want to go where they get the best return in term of when they're raising capital, but the public markets is the one where you listen to what they had to say today, that's really the one that is pretty clear they would prefer to do most of the borrowing when they start doing that from the public markets >> phil, thanks so much for that, and despite mike santoli, despite the downgrade, the drastic improvement in debt markets in the last month or so, that if they do have to go to the government it would be on reasonable terms. >> boeing looking to raise more debt would only do so most likely is if it felt that the additional leverage would enable it to preserve the investment grade rating to try to make sure that everyone is on the same page of what the implications might be and if you're within investment grade, this market is

not making tremendous distinctions in terms of cost. >> i think they should sayend a thank you letter to jay powell a few weeks ago it was unclear whether they could tap the credit market because it was closed for being able to do that instead of having it go to the government. >> powell did it with words alone. >> up next that's right he hasn't even started buying. >> up next, honoring everyday tthees mael honoring frontline workers. the details and the rest of the good news rundown straight ahead. woman: my reputation was trashed online.

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time for our daily good news rundown where we highlight positive stories in the wake of the pandemic honeywell, for instance, shifting its manufacturing operations at two chemical facilities to produce hand sanitizer for government agencies suffering shortages utah launching a program to issue free face masks to issue resident of the state who doesn't already have been. >> mattel unveiling new action heros to honor heroes on the coronavirus front lines. all of the proceeds will go to the organization first responders first and world war ii veteran captain tom moore

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check out the casino stocks making moves higher after hours. just got a lift after wynn's ceo

made some remarks in this ongoing event with president trump saying he hopes las vegas will be reopened by memorial day which is just a few weeks away, hard to believe. those stocks getting a bit of a boost as the president hosts a number of business leaders to talk about reopening the economy. >> sarah, does remdesivir's good news mean you'll be in vegas on memorial day >> probably not. >>. >> so from's the balance >> these are encouraging signs >> i think it's encouraging to hear that there are good results happening with a lot of these drugs. remdesivir isn't the only blockbuster drug that's out there. there are a number of other trials treating anti-inflammatory symptoms and all sorts of other things, even unheard of companies like fluristam and fujifilm and we're starting to hear results over the next few weeks.

>> very quickly, will we see the nasdaq be impulsive tomorrow >> yes, we will. the question is amazon, will that be the crowning moment for this rally we get the report tomorrow every reception so far have been positive. >> we are out of time on "the closing bell " melissa lee has you covered next. >> guy adami, tim seymour, karen finerman. >> microsoft and tesla all on the move and all surging after reporting results and we'll break down each of those names the game changer, plus the experimental coronavirus drug. grammy winner d.j. khaled is here and he's going all in on the fight against the global pandemic and the big money he's bringing in to help those most in need. we start with an earnings alert with facebook and microsoft both on the move after reporting earnings and we have full team