bitcoin before coming back red numbers on the board, evans is back. coincidence? i don't know. >> you're not the first person to try that connection, so let me point to something which is moving higher, which is gamestop this could go from a meme stock to a retail turn-around story. the ceo is leaving it's been a pleasure see you for real "closing bell" takes over. welcome back, kelly. and welcome, everybody, to "closing bell. i'm sara eisen along with wilfred frost. the major averages lower following record highs on friday one hour left of trade earnings season kicks into high gear this week coca-cola out this morning, ibm and united airlines reporting after the bell today more on all of these names strayed ahead. b bitcoin on watch with prices down 20% from the peak

the nasdaq is down around 1% facebook, amazon taking a step back tesla is off 4%. we'll talk about that in a moment 59 minutes left to go in the session. >> we'll talk about that and so much more coming up on today's show we'll talk about the move in tech and the key earnings reports to watch from the sector when we're joined by dan niles plus we'll discuss tesla's tumble following a deadly crash in texas over the weekend. david friedman will join us from the national highway and traffic safety administration. sara has a closer look at coke's earnings mike, let's start off with you >> a little soggy and not very news driven. i think really the context is the catalyst here. we talked about how the s&p 500 looked quite overbought. you had 95% plus of stocks in the s&p. all that says something was sort of ripe for things to pull back. also after we've had options

expirations each month this year we've had a little softening and so there's nothing that's changing the trending. i would say you have another 2.5% to 3% downside from these levels before you discuss whether you're falling out of this uptrend that would be like the 20-day average. beyond that i think this would be the area where if we really did get to pullback mode this would be a gut check level and a lot of people have mental accounting levels installed right there. definitely been a downshifting in risk appetites. look at the quality trade and how that has played out right here quality is an attribute of companies, strong balance sheets, steady profitability high beta is very cyclical, leverage very aggressive high beta has launched and taken off in 2021 and been strong for six months however, modest downtrending and then an uptrend so a little

shift back towards the less racy parts of the market and a little more steady and predictable. that could be a new inflection point as the market gets past this first year. take a look at the pbj, the food and beverage etf it's had a nice run all year definitely some pricing power in these stocks so if you're talking about consumer inflation, where will it endin up showing up >> pbj, i've never come across that clearly it's not the fundamentals, it's not earnings and not the macro that's doing the pullback. >> there's no change in the fundamentals or the economic expectations what it is is a sense that every time we've gotten these great earnings, even the companies be beating on the top and bottom lines are having a lesser than

average performance in their stock performance. we get it, things are strong and likely to get better but we've also had a 90% surge off the low in less than 13 months in the stock market coca-cola out with earnings before the bell and sara has all of the key highlights and takeaways for us sara. >> coke is a reopening story the results today show some real progress on that front a 5-cent earnings beat 6% organic revenue and volumes in march that return back to march 2019 levels before the pandemic asia a big part of the story the u.s. looks better as well and coca-cola has been making its own restructuring, internal changes to promote growth. they have been focusing on the grocery business that has done better since the pandemic and slimmed down by shutting underperforming brands like tab and fanta. it's also been cutting costs and jobs coca-cola benefited from five extra selling days

despite the improvement, though, in the overall results, coke did maintain its full year outlook high single digit percentage growth in organic revenues i asked the ceo, james quincy, earlier why not lift guidance. >> if we continue to hit quarters like this we'll have a very strong year and at the top end of our guidance. there's a balance here the degree of lockdown the rest of the year is a very telling factor as we adapt the business, and we'll either help us on hinder us. >> it's covid. that's what they're worried about. quincey shedding a light on the uneven nature of the covid vaccine rollout. it only gets a third of its business from north america. he plans to raise prooeices nex

year it could come by smaller packaging sizes or different changes. they haven't announced a price increase or change since 2018 so that's clearly a big deal. p & g out tomorrow morning. >> it's so interesting, sara, having a look at the share price that it's down year to date which surprised me a little pitt it was more because of a gut check at the start of the year than a steady decline or plateauing during the course of the year and it has been building over the last few months. >> right and that's because it is a classic reopening play this is a company where before the pandemic 50%, half of their business came from outside the home so they benefitted a bit from the grocery stock-ups during the pandemic but really got hit hard, much harder than pepsico which owned snacks and did better in groceries by the closure of stadiums and concerts and restaurants and bars that's starting to come back and

the momentum picked up in are ma january and february were weak and march picked up. they continued to see important in what he said was the great reopening in the united states, with some interest phases and patterns he said, for instance, consumers here in the u.s. are spending their evenings out they're going out to restaurants and bars more. because a lot of offices are still closed, they're not doing the lunches or going to the delis while commuting so they're still hearing it there but it really is tied to the lockdowns and to the phases there, and that's why in places like europe right now with fresh lockdowns they're hurting and in india with cases skyrocketing it's also a problem and hence the uncertainty and the guidance and the stock price. >> coke still down a couple of percent year to date. after the break a deadly tesla crash over the weekend raising fresh concerns about the company's driverless ambitions

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welcome back tesla moving lower today following a deadly crash over the weekend in texas phil lebeau has a look at why the accident is raising fresh concerns about tesla's auto pilot technology hey, phil. >> hey, wilf, it's raising concerns because of what police said when they responded to the crash and the accident scene they talked to some of the local reporters and they said, look, it doesn't look like there was anybody who was in the driver's seat, which then raises the question, well, who was driving this vehicle did they somehow get the vehicle to go on auto pilot and then one of the -- the person in the driver's seat then go into the back seat? that's one of many questions surrounding this crash it again is up clear if tesla auto pilot was engaged however, the federal government is now saying we are going to do a special crash investigation of this accident to see exactly what's happened. not the first time that they have looked into a crash involving a tesla vehicle and the question surrounding auto

pilot. they have had more than 24 probes now, the interesting thing here is despite all of these investigations, there have been no recalls, no action taken against tesla's auto pilot technology we should point out, nhtsa as well as tesla and anybody involved in safety advocacy in automobiles says drivers have to be engage had. there is no such thing as full self-driving vehicles. even tesla, you have to stay engaged. that's one of the points elon musk has made repeatedly and the company has made repeatedly. even though they say the technology is improving, elon musk has said many times that the technology is improving. the key thing to keep in mind here is this is not a 100% autonomous vehicle it is not. it is not close to that at this point. back to you. >> phil lebeau phil, thank you. for more on this let's bring in david friedman, consumer reports vice president of advocacy and

former national highway traffic safety administrator there have been so many probes into this, why hasn't it been dealt with >> thanks for having me on and sorry it's under these circumstances. it's yet another tragedy in a tesla. we don't know what's happened in this crash but we know there's a long track record of tesla's driver assistance system failing to keep the driver engaged there's videos all over the internet of people failing to use the system properly and failing to do exactly what phil just talked about. these cars don't drive themselves, you have to drive them in a lot of ways, tesla sends a very different signal to people. >> so you're saying it's a marketing problem more than anything else? >> even more than -- marketing is absolutely an issue tesla has overpromised and

underdelivered when it comes to the capability of a lot of their vehicles, but even more importantly than what they say, it's what they do. these cars basically almost encourage the driver to disengage. they don't do a good job of monitoring whether you're paying attention. and if you're not, requiring that you grab the wheel and focus on the road. that stands in sharp contrast to cars like cadillac and their super cruise system. if your eyes aren't focused on the road and paying attention to the driving task, it gets you on task if you fail enough times, it disables the system. tesla's system just isn't aggressive enough in ensuring drivers are engaged. >> so, david, how far away, how long away are we from serious adoption of autonomous driving in america, and do incidents like this push back that timeline >> look, the reality is no one knows how far away it is all we know is we're nowhere near there right now and that's

part of the problem with the way these tesla systems are designed they are designed in a way that allow you to check out and these vehicles are allowed to operate under conditions where they just aren't safe to do so. they just leave it all on the driver instead of designing a car that can compensate for that the reality is it's going to take some time for vehicles to be able to drive themselves. until then, you've got to keep your eyes on the road, your hands on the wheel, and tesla has to fix the flaws in their system >> but again, the headline that nhtsa has launched more than two dozen probes into tesla-related crashes. is anything getting done as a result of these probes any fixes made to make them more safe >> tesla has tinkered around the edges. they have reduced the time when their system warns drivers but it's not clear that's actually what needs to be done. this is why we've been calling for an active system to monitor what the driver is doing

but we're not alone. look, this system has been a recipe for trouble since at least 2016 when a tesla literally hit the broadside of an 18-wheeler. there has been multiple crashes that have followed on since. tesla hasn't taken the fix seriously and neither has nhtsa. we really need nhtsa to step up. i'm glad they have a special crash investigation team on the way to see what happened but even regardless of this crash itself, nhtsa needs to act, they need to use all their authority to force tesla to mix the flawed system and put regulations in place to ensure this never happens again at tesla or any other automaker. >> david, when you see claims that tesla has got the advantage, they're in the front or near the front and have the best technology in this space, what's your response >> look, we're consumer reports. we go by the data. we go by the numbers in fact our testers have actually tested tesla systems. when it comes to capability, they are one of the best out

there. when it comes to safety, they are among the worst. in fact the fact that their system is so capable and that they fail to do a good job keeping the driver engaged and may allow the vehicle to operate under unsafe conditions, it's actually a dangerous combination because it lulls people into a sense of security when the people can't actually drive itself you caompound that with the name and the talk from tesla talking about self-driving features, it's a recipe for crashes and we've seen them over and over and over again >> david, is it just tied to auto pilot mode or is there some bigger, broader worry with tesla and crashes and safety i know they usually get high ratings. >> look, it's really tied to this system where the car can take over some of the functions. the car can take over some of the steering the car can take over some of the acceleration and braking

but what the car cannot do right now is replace the human driver. so it is a fundamental problem with their auto pilot system and the system that allows the car to take over steering, braking and acceleration all at the same time our testers haven't been that impress wed their lane change system and other systems associated with auto pilot this is a smart company with smart people they know how to fix this. this isn't an issue of knowledge, i believe this is an issue of will. the reality is they haven't done it and now it's time for nhtsa to force them to fix these flaws. >> david friedman, thank you for joining us tesla down almost 4% today we appreciate it we've got 42 minutes left of trading before the closing bell. take a look at the major averages dow takes a step back, down 144 after closing at a record on friday s&p down 0.6 of 1% nasdaq is down a little more than 1%. technology is in the losing camp today.

the russell 2000 index of small caps down 1.4%. up next, mcdonald's is teaming up with one of the hottest musical groups, but will it drum up as much excitement as the famous travis scott meal, which was a real mover for mcdonald's. check out some of the top search tickers 10-year yield getting the most love as it has been for the past few weeks, down to 1.59, below 1.60 gamestop up there again, up 6% coinbase has been there, only down 3.5% despite a sharp drop from bitcoin over the weekend. tesla and coca-cola, which is higher after earnings. we'll be right back.

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just under 40 minutes left to go. let's check in on some individual market movers gamestop, as we mentioned, is moving higher. this after announcing ceo george sherman will be stepping down effective july 31st or earlier upon the appointment of a successor. the board is actively searching with ceo candidates who can help with the company's transformation shares of gamestop up 5.5% more ammunition for the bulls in terms of big changes at this company. shares of harley davidson revving up the company posting an earnings beat and raising its forecast amid demand for its touring bikes. that stock up almost 10%. mcdonald's is teaming up with bts to highlight k-pop

around the world kate rogers has more on this collaboration. >> hey, wilf this is the latest installment of mcdonald's celebrity signature orders platform. the bts meal will feature a 10-piece chicken mcnugget, fries, a coke and dipping sauces that mcdonald's says are inspired by popular recipes at its locations in south korea it will be available in the u.s. as well as 50 countries across six continents previous partnerships include orders from rapper travis scott and singer jay bell vin. the travis scott meal was responsible for some quarter pounder shortages last year. they are made up of mcdonald's staples but they have worked to boost same-store sales last quarter same-store sales were positive thanks to marketing promotions like these and a focus on the core menu items, guys. back over to you.

>> so is this a new strategy, kate sgl thesomething they're going o ramp up because they have seen so much success? i usually don't think of mcdonald's as a celebrity endorser kind of brand. >> they have done things like this in the past the travis scott was the first they have done in a while and it was really successful. some quarter pounder shortages after some locations and the quarter pounder is something that's been available but you attach the travis scott name and it's taken off so they have seen success with the platform if my own twitter account is how successful they will be, i got so much engagement from the bts fans they're really excited about the signature meal it certainly boosted the comps at a time mcdonald's needed it coming out of the pandemic. >> so talk me through how many followers both travis and bts have how famous do i have to get to get my own bespoke mcdonald's order. >> your own meal >> we're some way off, aren't we >> millions and millions of

followers around the world i think you're well on the way i'd love to know what your signature meal would be but it might be a little while. >> a quarter pounder with cheese, large fries, coke and six nuggets on the side and just plain ketchup. i like the sound of those but just ketchup for me. >> great, great. >> kate, thanks so much. great story. we have a market flash on tobacco stocks seema moda has got it for us. >> the biden administration is considering whether to require tobacco companies to lower nicotine levels of all cigarettes sold in the u.s. to levels where cigarettes would no longer be considered addictive that's dow jones quoting sources. it is a policy the white house is said to be considering. on this news, altria, british american tobacco are moving. you can see british american tobacco down 2.3%, at the lows of the day

wilf, back to you. >> seema, thanks so much. up next, shares of emergent biosolutions, the company at the center of the j&j error are moving the shares are down 12%. plus which big earnings should be on your watch list this season? we'll ask dan niles for his top picks. the 10-year yield around about 1.6%, ticking up from that 1.55 we touched late last week

the company behind that ruined batch of johnson & johnson vaccines is now facing new scrutiny from the fda. meg tirrell has the details on emergent biosolutions. now what, meg? >> well, sara, we learned from a regulatory filing from emergent biosolutions this morning that last monday the fda started an investigation of that bayview plant of emergent where they were manufacturing the johnson &

johnson covid-19 vaccine they say as of friday they agreed to stop manufacturing any new material at that facility and to quarantine things that they have already made at that plant as this investigation gets completed and they remediate any of the findings from that investigation. remember, this is after "the new york times" and others reported that an emergent batch was lost after cross-contamination with the astrazeneca vaccine which they were also making at that facility that has been moved out of that planned and j&j has taken over this facility. johnson & johnson saying in a statement that they're going to work with emergent and the fda to address any findings at the conclusion of this inspection and say it's premature to speculate on any impact this could have on the timing of our vaccine deliveries we are committed to delivering 100 million single shot doses of the vaccine to the u.s. government and helping to bring an end to this global pandemic guys, this could take just a few

days since we're in such an emergency situation, but really a pause there as the j&j vaccine is on pause in the u.s this plant has not been authorized by the fda to release any of these j&j doses, but it is important for supply of this vaccine going forward. >> and no update on when the u.s. pause on the vaccine might change later. >> we know the cdc advisory group plans to meet friday to discuss all of the data and come equipped to make a recommendation but friday will likely be the day we know about next steps. >> j&j sort of flat today. time for a news update rahel solomon has it for us. >> hello, everyone closing arguments continue at the derek chauvin trial. jurors are now on lunch break. the defense had been making its case more than two and a half hours and does not appear finished frank holland is in minneapolis and has been cover what has been a very long day in the

courtroom. >> reporter: the death of george floyd and the trial of the officer accused of killing him, you can see businesses boarded up and national guard troops are posted for possible social unrest closing arguments for the prosecution and defense. they both used emotional videos, including former officer derek chauvin putting his knee on floyd's death. the prosecution saying it was a malicious act. the defense emphasize that the prosecution must prove their case beyond a reasonable doubt, saying floyd's resistance and drug use were contributing factors creating that reasonable doubt on the cause of his death. deliberations continue until 9:00 p.m. tonight. if no verdict is reached, they continue tomorrow. rahel, back over to you. >> all right, frank, thank you you can get a full rundown of the developments on the news with shepard smith tonight at 7:00 p.m. eastern. sara, back to you. >> rahel, thank you. investors are gearing up for

apple's spring-loaded event tomorrow that's what it's called. we'll preview the new gadgets that could be unveiled the dow's off 175 points as we go into the final half hour of trade. hey, dad! hey, son! no dad, it's a video call. you got to move the phone in front of you like..like it's a mirror, dad. you know? alright, okay. how's that? is that how you hold a mirror? [ding] power e*trade gives you an award-winning mobile app with powerful, easy-to-use tools and interactive charts to give you an edge, 24/7 support when you need it the most and $0 commissions for online u.s. listed stocks. don't get mad. get e*trade and start trading today.

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dow down 162, the nasdaq down as we head into the close microsoft president brad smith making new comments on infrastructure spending. ylan mui with the details. >> reporter: microsoft is the latest tech company to get behind the idea of a sweeping public sector investment in infrastructure president brad smith signalled he's willing to negotiate over how to pay for it. in an op-ed over the weekend he wrote we must recognize these investments are expensive. a challenging conversation awaits about how to pay for all of this, including the impact on international competitiveness of economic sectors that operate

with tighter profit margins. this comes as president biden said this afternoon he's prepared to compromise as well the white house wants to raise corporate taxes. the business community and republicans want to talk about user fees instead. biden said today's discussion would cover both of those ideas. but a growing number of big companies are at least willing to entertain this idea of a trade-off between higher taxes an an upgrade to our infrastructure back to you. we're going to stick with big tech apple set to hit the marketplace with a new product launch coming very soon, tomorrow in fact. expected to unveil new ipads in airports as well as the debut of air tax. could tomorrow's event be a much-needed catalyst for the stock. very good to see you, thanks for joining us what are you expecting with the product launch exactly >> thanks for having me. so we're expecting as you

mentioned an update to the ipad line the ipad hasn't been refreshed in a couple of years so it's about time to do that. we expect the ipad pro to have a refresh with better display using mini l.e.d.s which means better contrast, better color gamut and that's part of the lineup that really needs a refresh given last year through the pandemic they saw extremely strong growth in the ipad line we'll start comping that in the june quarter of this year so we have one more quarter where it's going to be very strong and then you'll have very tough comps so it comes at a much -needed time to offset some of the comps that you would see in that time frame. we also expect that we would get some news about air tags there's some news in find my features where you can find

items so i think that's likely to be announced and airpods could see a refresh as well. >> new products aside, do you think the share price will find some pressure this summer, in fact even this spring, as we get into those tougher comp periods? >> yeah, that's a good question. you know, when you look at what the stock has done over the last call it seven, eight months, it's really underperformed from a broader market stand point you have the catalyst of a 5g cycle last year and that's behind us. you have the biggest quarter that apple reported a huge beat in and shares are relatively down so as you look forward over the next six to nine months there isn't another big product expectation. there's the continuation of 5g and that's going to be good. it's not going to have a material downtick from an iphone perspective but driving material upside to estimates is going to be challenging because the comps

are going to be tough not just in ipad and mac but the services side the services saw a huge ben fit from the app store growth particularly during the pandemic we'll be comping that as well. so it's the relative capping of the upside to numbers that's going to be a problem for the stock to really break out. and there is no new sort of significant enough product that anyone is expecting at the moment that should drive shares materially higher from these levels >> what about facebook, wamsi, which is very much out there, this war which is in a way being fought on pr grounds but also starting to damage facebook where it hurts where does this go and what are the implications for apple >> from an apple perspective is what's interesting is apple has been on the right side of privacy from a big tech perspective. what apple is doing is really enabling customers to have the option to say i understand how my data is being used. there are a lot of people, particularly younger folks, who

might not be aware or might not care but it's just corporate responsibility to some degree to make sure that people understand the risks that are associated with the data aggregation, whether or not they have the option to opt in or opt out of that and so to some degree i think apple is doing something that partly is self-serving they use maps that they claim is more secure or safari which they claim is more secure it is one company that is actually coming out relatively unscathed in this privacy battle where the fight for data has become many pro lif russ you've got so many people who are looking at various elements of this data economy and trying to monetize those, whereas apple is saying we're going to use our products really to capture revenue. we're not going to really use the data, we're not going to sell this data so they're not opposed to the ad model but they want to limit it.

so to some degree the debate for apple is whether or not consumers have a choice. i think that's the right thing to do from their perspective and it really helps them to make sure that their products are well differentiated compared to competitors. >> wamsi, thank you for joining us. >> thank you. still ahead, shares of peloton drop on a new warning and the key metric to watch in ibm's results. the market zone is coming next. tomorrow we have an exclusive interview with citi's jane fraser. so much to discuss with her. you don't want to miss that. that'somro torw here on "closing bell." we'll be right back with the market zone. instead of burning our past for power, we can harness the energy of the tiny electron. we can create new ways to connect. rethinking how we communicate to be more inclusive than ever. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change. faster.

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14 minutes left in the trading day. we're in the closing bell market zone, commercial-free going into the close. today we've got delano with us as well. stocks under pressure today after the dow and s&p 500 hit all-time highs last week the dow, s&p 500 and nasdaq all on track for their worst daily performance in more than three weeks. mike, it's really the technicals and the positioning that's at play as opposed to a fundamental reason why we'd pull back a bit. >> you could arguably say that the last little bit of upside we got into the record highs was technical positioning, momentum driven the news has been very good, better than expected on the economic and earnings front. that hasn't really changed so there is some support from those sources. but it's pretty acknowledged that just the distance that the indexes have traveled and the

fact that investors big and small seem pretty well exposed to the market and have for a while is probably accounting for some of the slippage and fatigue right here all that being said, it probably wouldn't surprise almost anybody if we get some kind of a stall or flattening out or pullback in the market it seems like it's much more a part of the chatter in recent weeks as people have marvelled at the rally just carrying on so it's hard to necessarily figure out where people's heads are at but i think where their dollars are at is kind of long stocks at this point. >> well, delano, what are you telling your clients right now how to position after we've seen such a tremendous run-up to record heights. >> i would agree with what mike was echoing there. we've seen a lot of great news and it's been really strong. we've had monetary and fiscal policies that have been dovish for investors and the backdrop of the economic boom and the recovery you're seeing management in different companies seeing

projections being revised higher and especially investors smaller, there's a lot more money in savings and checking accounts i think that was jam ie dimon's report said there was with $2 million more than this time last year so the backdrop is great i think right now we're telling clients to, one, reposition and make sure that we are in place where we have high conviction. i think we've been long a lot of great companies and so we're in good positioning and there's no need to change we're hoping things have been in a situation where it's kind of been quieter in the markets over the past year so that's sometimes a good thing when things are quieter and a little bit more calm. >> how about peloton shares, they are under pressure after an urgent warning from the consumer product safety commission. diana olick with the details >> sara, peloton fell hard at the open this morning, down about 7% and basically sat there all day.

this after the consumer product safety commission on saturday warned owners of the peloton tread plus with small children or pets to stop using the equipment. it pointed to 39 incidents, including one death, linked to the treadmill. peloton refutes the warning but in a message to tread owners yesterday said it was working on additional safety features bank of america, which still has a buy rating on the stock, cut its price target to $150 from $175 based on potential slowing growth from that warning the lower target is still 29% above where trading closed on friday sara >> diana, thank you very much. question to you, delano, about peloton which is getting hit hard and is now down 37.25% from its highs. does this make you nervous about the stock, the treadmill warning, or just the fact that it's going to be hard to capture the growth rates they have seen during the pandemic? >> yeah, sara. this is one that has very little

exposure just the reasons you mentioned, we're valuing peloton as more of a tech software services company and what it really is, is a fitness company with a strong user base and cult following but does that justify the valuation that it's sitting at i don't really truly believe so. i don't think the risk i obviously tragic events have happened with the treadmill plus, which i think that's something you see with a lot of manufacturers in the past. they'll get that figured out but i do see something where you have to continue to grow and build a user base and sell your products whether it's your acquisitions or continue that strong brand it's very cyclical in the sense they have a lot of great instructors and i'm actually someone who uses the peloton but i think that's a fickle thing of job evaluation based on something that can be moved very, very quickly.

chip stocks down they say the current shortage in chips should result in an excellent earnings season but any sign of supply and demand start tracking toward equilibrium may spook investors. they do plan to investigate the purchase of arm holdings citing apparent national security issues so we'll see what happens there. changing tune kind of a little too late some would argue. down 3.6% for nvidia either way. mike, how as the sector performed as a whole is there stock differentiation or -- >> there's been some differentiation. it's sputtered a bit recently. it stopped being really the locomotive of the tech trade a while back so i think this is a little bit of a reading of investor positioning relative to where we

are in the cycle always tricky to call exactly when you're at an inflection point in an industry cycle like this but no denying valuations in the index are pretty full. you had this comeback in intel but from very depressed levels that was sort of the big laggard in the overall group you know, we have all these announcements not just of the shortage but of new capital expenditure projects and massive foundries and things that are on paper if not in motion that's a great thing in the short term and it ratifies the strength underlying the long-term story, but also massive amounts of capital pouring into an industry tends to dilute returns down the road. i think that's a very big picture look and what susquehanna is looking at, feeling as if people were too overconfident in the durability of this cycle relative to where the stocks are trading. >> what about nvidia in particular, mike it's down today about 3.6% it's been more than a double

over the past 12 months and just one of those moon shot shots over the long term they say they're raising guidance how does the arm deal figure in? >> first of all, it's not underperforming the overall index by terribly much obviously it's dragging down the index. i think there would be disappointment if there was a problem with the arm deal. people love the strategic story which is why in regulatory risk was on an antitrust front because it seemed like it might be toosinner gistic in a way i don't think it's necessarily make or break at all for nvidia, close to a $400 billion company. the sentiment is not right to take this kind of a headline on a day like today. >> facebook's mark zuckerberg making comments about his social audio as the company unveils new

sound tools. let's get to julia boorstin for that julia. >> mark zuckerberg wants to make audio what he called a first class social medium just like text and video and to tap into the fact that audio is easier to make than video and can be consumed while people are on the go facebook is working on live audio rooms similar to clubhouse along with sound bites like reels but for sounding also a podcast sharing recommendation tool called project boom box as well as more tools for creators to make money on all of these audio platforms. ahead of apple's audio system change, mark zuckerberg criticizing apple for charging what he called a 30% tax on small businesses guys, back over to you >> julia, thank you. delano, do you like this move from facebook >> sara, yeah, i definitely do i think getting into the audio play for a lot of these big social media platforms is the

next step. twitter has been rolling out twitter spaces for their audio play and combatting clubhouse. if they're not able to acquire a company that has a feature that they like, then they try to emulate that feature so i think it's a smart play content creation, creators having value, is a new realm all platforms will be going through. different way where social media platforms can take a cut of that is another big step for social media platforms to diversify revenue, i definitely like the play i definitely think this is something we're going to see more and more often, especially with these social media platforms. >> ibm set to report earnings after the bell deirdre bosa has a preview of those numbers for us >> the focus will be on big blue's spin-off of its information services business that was recently named kyndryl. the street is eager to see if

they can return to revenue growth, which would be encouraging. keep in mind that ibm has seen its revenue decline on an annualized basis in eight of the last nine years. shares are up 6% this year making it the underperformer among legacy tech names that have seen value investors drive the wider group higher back to you guys. >> thanks so much for that up 6% or so this year, mike, but last quarter wasn't particularly encouraging. they haven't had many encouraging quarters for some time but last quarter was a big gut check. >> if you look longer term it's really been very range bound in a market where you piled up a lot of gains many concentrated in tech. it's been the same old type story for ibm in terms of slow top line there is a chance this spin-off does liberate some value i've always said that in theory there was something very similar to accenture inside ibm, in

terms of this i.t. consulting services, something they bought 20 years ago, so there is a business in there that the market is showing a willingness to pay a pretty high multiple for, compared to ibm i don't know if that will change some of the parts for someone who gets spun-off shares but the top line for ibmcorp continues to struggle and there is a chance that it could create some value. >> the stock has had not a bad run over the last few months, delano do you like the spin-off story is that why? is there growing optimism this could be the ticket for ibm? >> sara, hopefully because you mentioned not a bad run kind of in the short term but over the long term, especially for someone in the growth investing side and clients looking for

that growth play, there is an area in your portfolio if you're looking for a buyback and defensive send story and value story. but as far as the growth, they are struggling at the top line to increase that and that's something that as an investor you have to be paying close attention to. >> we have just two minutes left what are the internals showing >> a little bit soft matching what's going on at the headline index level the up volume versus down on the new york stock exchange, it's about a two to three up to down ratio of stocks. so it's the small caps and average stock are underperforming the indexes which themselves are off on the day. i want to look at 52-week highs and lows today on the nasdaq not because it's such a dramatic split but more than 100 52-week lows, it's not a worrisome number but a little wear and tear starting to build up on this index which did internally

peak about a month ago keep an eye on it for this sense of a stealth correction or undertow of selling. the volatility index, it was sort of falling apart as the s&p made new highs we have bumped up to 17.5. a lot of that is monday and rebuilding some of the vix getting through the weekend but definitely keep an eye on to see if anything changes that trajectory and downtrend. >> as we head into the close take a look at the dow we are at the worst levels of the session but taking a step back from record levels. dow is down 132 points boeing is the biggest drag on the dow. as far as the s&p 500 you've only got one sector that is actually in positive territory at the moment. that's real estate, up a third of 1%. everybody else is lower. consumer discretionary is one of the biggest drags, down 1.2 or so percent tesla is a big part of that story.

technology is under pressure with the nasdaq 1% you heard about the susquehanna warning, though you are seeing some big cap tech do well. netflix, apple, google is also higher staples are holding up better after the better coca-cola results. there goes the bell. and some of the riskier parts of the markets like the spacs or crypto is getting hit as well. the ark innovation etf down 3.4% at the close. welcome to "the closing bell." i'm wilfred frost along with sara eisen and mike santoli. finishing down half a percent on the s&p 500, a full percent on the nasdaq, about a third of 1% on the dow and 1.3% on the russell. health care and real estate, dollar soft, down half a percent today and 10-year yield ticking up a bit to 1.60

investors are set for a pair of big earnings, ibm and united. we'll have those as soon as they cross. plus investor dan niles will join us on the tech stocks he's betting on ahead of their quarterly results due later this ye week delano is still with us as is megan. mike, as we've been discussing throughout, a bit of a pullback and still comfortably above 4,100 on the s&p 500 where is it from here and what are the key factors to look out for. all technical factors and positioning factors? >> at least those are at the forefront. one of the themes that is perhaps relevant is the idea of just how good is too good when it comes to how persistent the rally has been, how far it's gone up without much of a break to the downside, how many stocks have been overbought and the economic data. the rate of change of improvement in terms of the macro numbers is probably close

to peaking if it's not there yet. we do still have earnings estimates going up for 2021, but again that pace of revision upward has been pretty strong. the market tries to assimilate when that's peaking. you also have lumber prices going up every single day because the housing market is so great. it starts to feel as if it's creating some of this friction in the overall economy and markets so i think it is mostly about technicals you still have 3% to the downside on the s&p from here and it still would just kind of be a nick on the uptrend so you don't want to overreact to one ay, but just given the fact that we're up so much in just over a year and the cycles would suggest that you shouldn't be surprised by a little bit of a give-back phase. >> megan, you said you've been increasing positions in recent weeks in the value and cyclical parts of the market. what type of sectors and names and why now? >> well, we have been

increasingly rotating into value, taking down some of our growth but also some more defensive oriented, higher quality, lower volatility type stocks so what this translates to is value across sectors, but also primarily in financials and industrials where we still see further room to go energy and materials are another two sectors where we are overweight right now we think that the 10-year yield is taking a little bit of a breather but we do expect to it move higher over the next 12 months towards 2% or 2.5% depending on the amount of economic surprise to the upside that we could see. we do think there's room for economic surprise to the upside even though there's a tremendous amount of optimism in the market we clearly know we'll have a great blowout year for growth but there's the potential depending on how much of the stimulus consumers actually spend where we could see growth

surprise to the upside and that's an environment conducive for value and cyclicals so that's where we've been leaning and focusing our attention. >> delano, are you more worried that inflation will surprise to the upside or growth will surprise to the upside >> i think we'll see more growth surprise to the upside megan was mentioning we are in a situation where there's been a lot of optimism in the markets but i think there's still a little more growth to the upside, especially for the mega cap companies where we've seen a little bit of softness and weakness over the past few weeks. those are good opportunities for investors to pick the names they have the highest conviction on i think you'll see a lot of those names come back stronger for the rest of 2021 >> mike, do you think the crypto move has anything to do with the stock market do you see any correlation there? is it bitcoin plunging over the weekend? is that a sign of risk coming off the table for the overall stock market or you wouldn't draw that line

>> i wouldn't say that it was causal but i do think it often c coin sides i do know over the weekend -- what i find interesting is within the stock market you've seen a bunch of these retail supported, more aggressive, more speculative parts of the market have corrected severely in the last two to three months you know, that sort of actually had the retail bid get side lines at this point, except when it comes to bitcoin and crypto-related stuff in a way it's just rolling from one area of the market to another so i don't necessarily think it's the reason we've been backing off today. there has been a little more towards defensive stable, quality stuff in the market for a couple of weeks now but i don't think they completely operate in separate vacuums. >> megan, we've had lots of

stimulus, probably more to come. though if this next batch comes with tax hikes attached, is that a net negative for the stock market >> well, it does depend on the stocks certainly those more geared toward infrastructure spending like industrials, materials and energy, mostly the clean energy can benefit. they're probably less likely to be hit on a relative basis from the tax increases, but we do think it's a headwind, particularly if you think about the compounding effects on technology, health care and other growth names these are parts of the market that get more of their revenue from overseas and that focus from the biden administration on taxing overseas revenue, the global and tangible tax and leveling, getting more revenue from overseas is a bit more of an issue for those types of stocks than the headline corporate tax rate so it's something we're

watching, and we do think this will be increasingly priced into the market as we head into the second half of this year >> and then there's tech, delano we saw today a sort of divergence within the tech trade. the nasdaq closed lower by more than 1%. tesla, nvidia, amazon, the chips got hit today. but you had strength in apple, netflix, google, some of the other names. how do you play this sector, particularly as we get ready for a busy earnings period, starting tomorrow >> yeah, sara, that's a great question i think the best way to play it is be in your high conviction names. that's a name we have high conviction on, particularly because of the content if you look at 2019 when disney plus unveiled, netflix share price performance was above and beyond all the rest of the players in that streaming war and i think it's mainly because of content management, we saw that ted was promoted to co-ceo and i think that's because of a great job they did on original content,

whether it's licensing, all the deals they had with sony so there's a lot of room to grow in these tech names whether it's staying at home or reopening i don't think anyone will not be watching their favorite netflix shows so i think you want to stick with your highest conviction names in a time where you're seeing growth in tech names being hit due to the yield but i think you want to stay with those names. >> meghan, what are you advising your clients that need yield where should they put their money to work? >> well, it is part of the allure of value stocks and those that tend to have a higher dividend yield stocks overseas as well tend to carry a higher yield so we are overweight internationalic equities they have been hit by growth concerns but valuations are extremely cheap and you do get a little bit more income over there so that is one potential option for investors looking for a little bit more yield in their equities

>> mike, if you look at the market today, you might drift over to the bond market and say, oh, well, yields must have been higher and they were a bit but still 1.59 we're not talking about 1.78 which is more the scary levels for these tech valuations. you saw some pressure on spacs and other momentum parts of the market why? >> right i don't think it was really driven by the absolute level of yields but the fact that bonds have gotten a little bit more buying interest recently is part of the overall move toward a slightly less aggressive, more defensive and stability bid in the market so i don't necessarily think that we're talking about levels that matter in terms of driving one area up or down in the stock market, but more in general it seems like everything has sort of gotten into a lower gear and that includes bonds getting a little interest. >> we do have an earnings alert on ibm and it looks like they're returning to growth. deirdre bosa with the numbers.

>> yeah, this quarter at least so a surprise on the upside on both the bottom and top line adjusted eps coming in at $1.77 versus $1.63 expected revenue coming in at $17.73 billion assa sara mentioned, this is a return to annual growth. this is the only the second time we've seen quarterly revenue not a decline in a few years so shares are popping nearly 4% i want to break out the cloud and cognitive revenue section, one that investors look to as ibm shifts to hybrid cloud coming in at $5.4 billion versus $5.3 billion expected. you have the ceo reiterating that he is confident ibm can achieve full year revenue growth this year. sara and wilf, as i mentioned in the preview, in eight of the last nine years, ibm has seen

revenue decline on an annualized basis. so this being the first quarter, closer to this goal but we'll have to see if they can keep up this pace for the rest of the year. >> yeah, some good momentum to start the year no doubt. deirdre bosa mike, when you look at this 21% cloud revenue, better revenues overall and a potential catalyst here with the spin-off what's your impression on the stock? >> yeah, there's certainly a story line here that it is getting to spotlight the growth opportunities more than the declining legacy business. so the spin-off will house a little more of the lower margin, you know, kind of slower growth or no growth business. in theory it leaves a little more of a visibility on the higher growth cloud type businesses 1.77 is a beat and it's a familiar pattern with ibm. at the end of 2020 the estimate for this quarter was 1.78 so there was a walkdown of forecasts since then and then

they came in and beat it so we'll see i think one of the things that a lot of yield oriented investors, the rate of ibm's dividend yield to the s&p's dividend yield has rarely been higher >> delano, what's your take? can they really execute a full turn-around here >> that was great earnings numbers. obviously after hours the stock is moving forward. i think this is strong i think the market investors wanted to see top line and bottom line growth and that's what the market investors got. i want to see this stretched out and look at their earnings call and see what the plan is moving forward to sustain this because i think that will be the biggest thing for investors going forward, the sustainability of the strong move on the top and bottom line, wilfred. >> they're naming a lot of names in the release of some of their wins

siemens, palantir and others thank you all for joining us, we appreciate it. up next on the show, investor dan niles is back to tell us the two tech stocks he thinks will be big winners from the economic reopening. plus united earnings, airline companies set to be released in just aew f minutes we're back in just 90 seconds on closing bell

big tech set to begin

reporting earnings this week we'll hear from netflix tomorrow, microsoft, google, apple and facebook on deck next week joining us now, dan niles. dan, good to see you thanks for joining us. >> my pleasure, wilfred. >> firstly, dan, big picture questions before we get on to those specific earnings points what about the headline market levels, are you still expecting some kind of correction? and what do we mean by correction, 10%, 20% >> yeah, so i think i've been pretty consistent with my thoughts, which is you've got a lot of stimulus to keep driving the market to new highs but the at some point you're going to have to have the fed warn i think come the summer that they're going to need to taper and then you get a 10% to 20% type of correction i mean last week to some degree worried me because despite the market hitting new highs, the s&p up four weeks in a row now, the first time since august, you actually had some of the higher momentum sectors of the market

selling off. the spac index was off 3%. a lot of the electric vehicle names were down 10% to 20% and the semiconductor index, that was down a percent last week so you could really be walking into a sell the good news earnings season because everybody is expecting blowout results. you saw that with the banks where a lot of them sold off despite good results. >> on that point before we get on to the tech earnings previews, what is your positioning on jpmorgan? i know that was one of your top picks at the start of the year as you said, good numbers, beat expectations but sold off a bit. >> yeah. here's the funny thing about the banks, jpmorgan specifically if you look at it, jpmorgan was down 55% of the time daily reported earnings so it actually goes down. we sold out of our jpmorgan position figuring everybody is expecting blowout numbers. they delivered blowout numbers and we thought the stock would probably go down we actually started buying some

of that back today we actually bought some more energy stocks today that we had gotten smaller in back a few weeks ago because they were up in a straight line so i think, you know, it's -- again, we saw that with click this morning also. they positively reannounced semiconductor company cap equipment space preannounced $1.20, the street said 91 cents and the stock closed down 3% or 4% today and so i think that's what you're sort of dealing with is a lot of positioning issues. but we love jpmorgan, we love the energy space between now and year end we think they'll be the two best sectors in the s&p. >> you did not, dan, like the tech space going into the year, except for oracle which has proven to be a very good call. that stock has tended to reach new highs. but now you're liking facebook and google ahead of earnings >> yeah. we talked about it on our last interview. we like the reopening play, so

energy and financials are in that, but so is google and facebook remember, advertising is tied to gdp growth for google in particular, you've got about 10% to 15% of their revenues and the travel verticals, the leisure verticals, so as hotels and airlines start to advertise again, that's going to be great for their business and gdp is tied to advertising. you're going to have the best global gdp growth of over 6% since 1976 in the u.s. it will be the best growth at about 7% since 1984. so all of that should be really good for both of those names as advertising really accelerates i think you'll see both companies have revenue growth in the high 20% range this year they're trading at really good market multiples the s&p is at 24 times these talks are a little above that but they have much better growth than the market overall and they proved to be defensive last year in that they both grew

revenues despite what was going on with the gdp. >> dan, one stock that jumped out is viacomcbs talk us through that. >> yeah, you can make a lot of money by buying stuff when other people absolutely detest it and hate it. if you look at what's happened over the last month or so, you know, viacomcbs was caught up in the archegos liquidation so there were about nine stocks that got blown out because of that if you look at their base business, streaming is 10% of their revenues, 2.6 billion in size it grew 49% last year. netflix revenue growth last year which was boosted by the pandemic grew 24%. so you could argue that business by itself is worth as much as the entire company even though it's only 10% of revenues and that's just relentless selling as we saw even last week there

was more block trades. but we think the stock could have 50% upside from here. we bought some more stock last week so for us, you know, there are other names in that basket actually that were caught up in that liquidation we're looking at some china adrs as well, some stuff related to travel, related to search, et cetera these names, that archegos basket was down about 49% from its peak so for us we're really excited about those types of names versus trying to be cryptocurrency or ev or a deli in new jersey that's worth $100 million, hometown international. >> yeah, you're not going for the $100 million deli? >> no. i don't think the economy is that good. i'm sorry? >> i don't know, pastrami can be very good. my follow is on the tech names that you liked, on facebook and google dan, the second that the

treasury yields start to go up and start to rise, we've seen that before and had you on and you have warned that you're worried about inflation and higher yields, these stocks get hit, whether they're gdp plays or not, no matter what the valuation. they're lumped into the broader tech play, aren't they >> yep, you've absolutely right, sara the good news is we're a hedge fund so we have shorts so we started to put a lot of shorts on in the semiconductor space. why? it's a space that everybody expects massive beats and raises you saw that with click today. they preannounced upside and the stock got hit off of massive numbers. $1.20 eps and you're expecting 91 cents but there are pockets where you've got inventory building up autos and pcs where you don't have that issue, but in semiconductors in particular, expectations are through the roof you saw that with tsmc

they reported, they raised guidance for the full year, the stock got hit. biggest foundry in the world semis in general were down last week so we're trying to balance our positive news. the good news is the facebook has the stuff going on with apple. google has some stuff around tracking as well and so that's helped to keep the multiples maybe more in check than they would be otherwise, which is great semiconductors is the exact opposite where expectations have just gone sky high and we think there's actually going to be some issues. if we're out going on vacation and not needing to buy a pc or a mac or whatever, some of those things are going to start to come back in as supply improves. so you're absolutely right as yields go up, facebook, google, will get pressured and semis will get hit hard. >> dan niles, always good to check in with you and your position thanks for joining us. >> thanks, sara.

thanks, wilfred. now let's go back over to mike santoli for a look at how this market is tracking compared to previous bull markets sure seems faster, mike. >> we featured a chart like this several times over the past number of months and it's actually interesting that the bull market, if you want to call it a new bull market, march of last year, had really been tracking closely two of the fastest starts to bull markets ever, 1982 and 2009 the blue line is the current experience if you look back late last year, they were all very much matched up whether you think that it was a new bull market a year ago or not, these are the only times the s&p has been up that much in this compressed area of time so we are now way overachieving as you can see. this is why a lot of people are looking at the general cadence of how cycles have tended to work and saying it really shouldn't surprise anybody if right now we do have some correction we have lower returns in the

immediate term, even if this is the start of a multi-year upturn if you're aggressively and incrementally bullish on stocks today, you're increasingly dependent on rare streaks of good luck happening down the road i think that's one way to think about it not so much in terms of absolute levels or that it has to stop in its tracks, but it should inform the risk/reward calculation as we talk about an entry point right now. >> mike, thanks so much. still to come, we'll ask a crypto investor whether this weekend's bitcoin's flash crash is a warning sign. plus a soccer super league -- juven juventus stock is sharply up we'll have much more coming up on "closing bell."

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you don't do this. we do this, together. bounce forward, with comcast business. it was a wild weekend for bitcoin. the cryptocurrency plunging 20% from its all-time high hit just last wednesday among those feeling the impact is coinbase with the stock closing lower today by a little more than 2% joining us is matthew rosack,

co-founder and chairman of block. matthew, thank you for joining us first of all, very dramatic, what happened this weekend exactly? >> thanks for having me. yeah, we saw a lot of drama in bitcoin over the weekend having its price drop from $60,000 to $51,000. in bitcoin and crypto, when bitcoin catches a cold, the rest of the market reacts certainly it sneezed the rest of the crypto market caught a cold and everything went down 15%, 20% it has recovered to about $55,000 but in terms of what happened, there was a few dynamics over the weekend, whether it was the chinese mining, uncertainty and doubt on twitter, some profit taking. it was a constellation of lots of events that really drove the price down and it's recovered about halfway. >> it's a reminder that it can still be risky and rocky for individual investors

how much do you see retail as driving the bus here on some of these prices of cryptocurrencies, like bitcoin or even a dogecoin or coinbase stock? >> if you look at the broader market, you see people getting more and more access to bitcoin. coinbase is the largest crypto marketplace in the u.s., and that provides more access to people to get bitcoin. it is volatile it's gone over 670% over the last year. its average irr the last ten years since inception is 200%, but it's been a volatile path to get there. and so it's different now because you have other participants playing into bitcoin, so there's an underpin of institutional interest. and you see this in the treasury of microstrategy and tesla, square, paypal and others.

and then you have wall street players like goldman sachs, fidelity, jpmorgan providing research and access to bitcoin so it's the underpin for bitcoin is a lot different than it was a year or three years ago when we saw much more volatile swings. >> matthew, clearly bitcoin's performance has been very strong overall and the volatility remains significant. when you also throw in the likes of dogecoin and its extraordinary rise last week, even when it's on the up, are you looking at it thinking, gosh, i wish it would just calm down a little bit because this doesn't help the long-term argument for these cryptos as being a genuine store of value >> it's a great point. you look at dogecoin which was originally made as a copy of bitcoin. it was kind of a meme-led community. you take a giant step back, despite having a 400% spike over the last week and its now valued

at about $50 billion, the giant step back is you look at elements that are absolutely new. they're happening in realtime. look at wall street bets and gamestop this is cooperative capital. these are people that have access to trading, they have access to information. the way they communicate and collaborate between reddit or twitter or discord are all new avenues for figuring out alpha or thinking through what the next investment is so it's less about dogecoin for me and there is a new community that is altruistic, wants to make money and have some fun along the way. so with that you're going to see things like gamestop get rescued. you're going to see other corporate citizens that are doing well on either a carbon footprint or some kind of a human rights dynamic to have an effect on that and so these folks are voting

with their wallets our new player in financial services >> so part of the problem this weekend or part of what caused the price drop, matthew, were rumors about regulation potentially from the u.s. treasury around money laundering what if we actually start to see some real regulation here after cryptocurrency, and it really could come from all sides, governments, central banks around the world >> i mean bitcoin is one of the most regulated assets in the world. it's got very good clarity from the irs, from treasury, from the cftc, s.e.c., and there's a whole bunch of other cryptocurrencies that need more definition so i think as a country, if you think about how we approach the internet, the early internet and became a market leader in that, this government and this country has a real opportunity to be a thought leader using this technology and these

new rails for money to its advantage. i think this is almost an imperative for america to get behind this, talk to their regulators, members of congress, et cetera. i've been trying to educate d.c. and other regulators about the benefits of crypto and blockchain technology for over half a decade. it's a slow process. nothing moves fast in d.c. technology far outpaces the ability for regulators to get their arms around this but engagement and proper discussions, the time is now to do that. >> well, gary gensler, new head of the s.e.c., might see a bitcoin etf, we'll see. >> thanks for having me. when we come back, big blue's big beat. we will break down ibm's stronger than expected earnings and discuss whether the stock will finally stop underperfoinits llrmg feow dow and technology peers we'll be right back.

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welcome back time for cnbc news update with rahel solomon. >> hello, everyone the coast guard says at sunset tonight it will suspend the search for survivors from a boat that capsized last week off the coast of louisiana eight people are still missing. the state department is updating its travel advisories due to heightened covid-19 concerns officials say more than 80% of

all countries will be placed on the department's do not travel list. in new york another potential investigation of governor cuomo the state's attorney general has received authorization to start a criminal probe into whether cuomo misused state resources to write and promote his book on leadership. and the oscars are going maskless, at least on camera variety now reporting that attendingies at the academy awards will be asked to keep their masks off at least during televised portions of the event. capacity will also reportedly be limited to 170 people with audience members being rotated in and out of the gala apparently during commercial breaks you'll be asked to put your mask back on. so, you know, there is that. i'll send it back to you. >> trying to make it easier, even if not totally there yet. rahel, thank you united airlines results have just crossed and phil lebeau has them for us. hi, phil. >> this is a miss on both the top and bottom line. keep in mind the estimates have been moving around in terms of

the bottom line loss the loss of $7.59 a share comes out to an adjusted net loss of $2.4 billion for the quarter the street was expecting $7.08 a share. revenues a little shy of what was expected coming in at 3.22 billion. a couple of things to keep in mind, core daily cash burn in the first quarter, $9 million. that's $10 million a day better than it was in the fourth quarter. remember, they swung to positive cash flow in march, sow y you'r going to see what was a cash burn now turning into positive cash generation in the second, third and fourth quarter cargo revenue up 88% in the first quarter compared to 2020 up 74% compared to 2019. but here's the important thing that people will be focused on united expects to have positive ebitda later this year when

corporate and international traffic are down 70% compared to the same time in 2019. currently it's down 80% to 90% the company also expectses positive net income when long haul and international traffic are down 35% so whether that's early next year or a little later out, those are the metrics that united is expecting. again, the company reporting a greater than expected loss of $7.50 a share for the first quarter. don't forget, tomorrow morning you do not want to miss our interview with united's ceo, scott kirby. we will talk with him on "squawk box" about the q1 earnings and the guidance for the company heading into the rest of this year guys, back to you. >> phil, thanks very much. ibm shares are higher after reporting stronger than expected earnings we'll get analysts reactions to those results state ahead. tomorrow don't miss citi's

jane fraser interview at 3:00 p.m.

ibm shares are popping on the back of reporting revenue growth joining us now is an analyst with evercore isi who has a neutral rating on the stock with a $140 price target, which is not too far from where we are right now. this was a strong quarter for ibm. 21% cloud revenue, continued double digit growth for red hot. is this a turning point for ibm in the stock ahead of this planned spin-off by the end of the year >> yeah, you know, it's definitely a very nice stock year for them right now. i'll start there, which this is a very good start of the year. especially where revenue growth went positive after being down 7% i think it's a nice positive sign for them. to your point does it mark something dramatically different for the stock, i think the challenge has been that you've

seen this at ibm where you have one good quarter and don't build any consistency. so the key will be to have a couple of these quarters in a row to build up momentum in the stock. >> so what are you looking out for on the call and is this also, the second part of this question, a good economic reopening or is this more of a structural story that they may or may not nail. >> i'm answer both parts and understand what is driving the change in the narrative. there is a good macro cyclical recovery that's happening and i'm sure that's helping them out. what is notable is they said they are still comfortable with the top line growth targets for the year and that's despite the fact that fx is 100 basis points so it's going better than they expected what you want to focus on is the sustainability of this growth, if it's more secular on the

software side or not and what does the spin-off potentially mean in terms of any potential disruption of the model. >> i'm told we'll learn more about that in the middle of the year once they start working out the financials in the next few months we've got to leave itthere for now. thank you very much. up next on the show, a massive soccer shake-up. a dozen of the world's richest teams forming a breakaway european club competition that could upend traditional leagues. as soon as i saw this story, i wanted to know wilfred frost's take the big business impact -- >> be careful what you wish for. i'm ready to bore you all for hours. >> can't wait. take off. you downloaded the td ameritrade mobile app so you can quickly check the markets? yeah, actually i'm taking one last look at my dashboard before we board. excellent. and you have thinkorswim mobile- -so i can finish analyzing the risk on this position. you two are all set. have a great flight. thanks. we'll see ya.

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the visionary lexus nx. lease the 2021 nx 300 for $349 a month for 36 months. experience amazing at your lexus dealer. 12 of europe's biggest soccer clubs announced plans for a breakaway european superleague and the reaction has explosive and almost universally negative. uk prime minister boris johnson weighing in saying i don't think it's good news for fans, i don't think it's good news for football in this country, he means soccer, and added that he would try to stop it french president emmanuel macron saying the project threatens the principle of solidarity and sporting merit and i think that is really the key factor, sara, that's driving fury from fans, greed versus merit. in european soccer you can get relegated from your domestic league and you have to qualify on merit each year in order to

play in the european competitions like the uefa champions league, which this new super league is designed t replace. the 12 clubs are trying to create a fail-safe guaranteed participation in order to boost revenues and their club values the guaranteed full participation in the top competition is the biggest reason why, for example, nfl teams are worth multiples of european soccer teams, even though many millions more fans tune in for soccer than nfl worldwide. a glimpse of that in the share prices today of a couple of the clubs involved manchester united and juventus rallying significantly jpmorgan is providing the financing for the league but weren't available for comment. sara, the level of reaction has been way bigger than i think anybody could expect as i said, very, very negative >> i think it's so interesting, because it sets up all sorts of questions and ramifications in

the business world and all the money that's been tied to this for one, how about the broadcast deals? billions of dollars of deals negotiated in the past for sports rights on broadcasts that haven't factored in this potential. there are games like ea which has the popular fifa game and the rights to this but i guess ultimately, wilfred, the question is whether they go through with it given the backlash, or maybe use it as a negotiating point to get to somewhere in the mill middle as the billionaire owners are thinking big. >> all eyes on the likes of ua furnish. what level of play they put in to stop this i think the broadcasters would welcome this by the way, because of course the plans are to try and boost revenues overall and would help them. what i think is interesting from our perspective is we talk all the time about the need for exclusive capitalism not just about the shareholders but about the shake holders too. and what we have seen is 12 owners deciding to steam roll and ignore the interests of their stakeholders who are the stakeholders.

>> the employees, the employers. they don't want to see this. it's the customers, the fans, any definitely don't want to see this happen opinion and you could argue in the starting point that those fans should have a bigger say than in a normal traditional consumer products company they are addicted to the product. we don't have a choice but to always buy the product on offer and we are totally ignored one other point, the timing this comes at and starting point in terms of the fact that the 12 clubs are unbelievably rich and wealth already and the poorest clubs smaller clubs struggle particularly after the pandemic and trying to create something to accent yacht the gap of the richest doing the best and poorer teams struggling i know we meant to stay imimpartial. i don't know if that can change in football and soccer but it's a disgrace. >> i mean, that's why i wanted your take. really smart by the way i reached out to nike and adidas haven't heard anything i'm sure it has ramifications for them as well

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we've gone breaking news in the deer erik chauvin trial. let's get to our shepard snith. >> wilf thanks closing arguments just wrapped in up trial of did he derek chauvin and the jury getting ready to deliberate. the prosecutors argue that the fired minneapolis cop abled his training and killed george f kneeling on his neck more than nine minutes, called out for his mother, jornl floyd slowly went limp >> george floyd begged until he could speak no more. and the defendant continued in assault. when he was unable to speak, the defendant continued. when he was unable to breathe,

the defendant continued, beyond the point that he had a pulse. beyond the point he had a pulse, the defendant continued in assault, 9 minutes and 29 seconds. when the ambulance arrived, the ambulance was here and the defendant continued. he stayed on top of him. he would not get up. he would not let up. he stayed on him, grinding into him, continuing to twist his fingers, hold him down he had no pulse. he was not breathing he was not responsive. and the defendant had to know what was right beneath him what the defendant did here was a straight up felony assault this was not policing. it was unnecessary it was gratuitous, disproportionate and did he it on purpose

what the defendant did to george floyd killed him this wasn't policing this was murder. the defendant is guilty of all three counts, all of them. and there is no excuse >> the prosecutor insisted he knew better, he just didn't do better then after a break, we heard from chauvin's defense attorney who spoke for nearly three hours. the judge at one point interrupted him to give the jury a lunch break. the defense tried to sow doubt over the cause of death. suggesting drugs, heart problems even carbon monoxide from the patrol car exhaust may have played a role. the defense also insisted the use of force was reasonable because george floyd was big, appeared under the influence and fiercely resisted getting in that patrol car. >> mr. floyd was able to overcome the efforts of three police officers while handcuff