gundlach is saying, if we get above 3%, we could easily see 3.20 also the flattens in the u.s. yield curve is probably getting a bit overdone as well if you think of some fundamental reasons cited for why ten-year yields have been selling off, people have been pointing to the rise in inflation expectations commodities boost as well. oil price, energy prices have shot higher. if that's the case you would finally expect that to be expressed in the belly of the curve, not just the front end of the curve, which means we could eventually see some steepening flattening has been a big theme as far as the u.s. yield curve is concerned it's been a pain trade anyone who has had this, but you get the feeling sentiment is turning especially when you hear mr. gundlach saying ten-year, 30 year could break through the 3% and set a new trajectory going forwards, hovering around higher levels than in the past. >> all right >> again, is 3% just a number? head to our website for more market commentary on the move and the u.s. treasury yield. >> let's look at markets looking at the slightly disapp

we'll have more with gundlach and including his take on bitcoin. we'll be back in a couple of minutes. at fidelity, our online u.s. equity trades are just $4.95. so no matter what you trade, or where you trade, you'll only pay $4.95. fidelity. open an account today. >>> welcome back to "closing bell," i am eamon javers chinese tariffs were announced this morning this trade official saying chinese tariffs were in attempt to intimidate the trump administration the trump add mministration wil not back down. described as u.s. effort on trade as a real effort by the united states to get china to change its ways and said that china is good at promises but not good at delivering on them we'll see whether the tic-for-tac here continues on throughout the week. i talked to a white house official last night suggesting that it is all under is discussion kirsten neilson is briefing reporters right now at the white house's press briefing room and she has said the president and the pentagon are working together to deploy the national guard at the border with mexi

i go back to what jeffrey gundlach said yesterday. in 2017, tony, you would probably know the exact number, i think the s&p range was somewhere around 450 handles so far this year, we're around 340 of that. so we're a quarter in, and if my math is correct, that's somewhere about 70, 75% of last year's range has already been traced out what if we're focusing too much on this narrative of, where is the next 10% what if tonyis right, in the long term, fundamentally, everything is strong about the economy. we're going to be okay but it's going to feel different in '18 and we're going to go all over the place, and we just might be sitting in a trading range. if you're predicting which 10% of market is going to move, boy, you are going to get chopped around like crazy, making that determination. >> and -- agreed so in mid-january, i'm up 7.5% in three weeks, ridiculous euphoria the next 10%, you don't know down here, down 10% with still better earnings, lower long term rates that have come down from the 3% level, odds are your next 10% are

scott is there to sit down with scott gundlach. >> got off the stage a few minutes ago. interesting investment ideas. the first a theme we talked about in your office you had long xop in energy play. you told me back in december. >> december 13th. >> long commodities. this plays into that >> it does play into that. it was really going to be the crux of my presentation. basically what i was talking about, there are many indicators signal inflation that's a change. for years there weren't really inflation indicators what i talked about on the stage here are things leading for core cpi like gdp, real gdp, like pmi surveys. they lead with a pretty high correlation of 0.8 they do it with a year and a half, year and three-quarter lead time and they turn up a year flf, a year and three-quarters ago also historically when you go into late economic cycle and when you start getting closer to recession, commodities go up a lot, back to 1972. the energy sector and i've heard this a lot on cnbc, it's a valid point, it's lagged in a way that's kind of bizarre this year not a very grea

alto as a way to capitalize on a cyberwar, which he said is the next financial crisis then jeff gundlachuggesting that investors go long xop, an oil and gas etf, but this is the key, short facebook. he highlighted the regulation overhang as a factor and said there is never one cockroach in the kitchen, meaning he thinks facebook will have more to apologize for in the future. >> got to love the always outspoken jeff gundlach comparing facebook to cockroach. what i do make of that i won't ask you to talk about oil, but short facebook? cockroaches? >> i would say zuckerberg and facebook passed the first test, but there's no doubt the earnings tomorrow will be key. specifically around regulatory concerns you still have the eu. it will be a winding road, a battle going ahead that's why facebook, the big black cloud is regulatory. i think they passed the first step but they will have to navigate this. that's the worry we think 1 billion to $2 billion of advertising revenue is at risk, but it's about containing that that's the risk of the story >> i know there was a reaction on box the stock so

let's bring in jeffrey gundlach joining us from los angeles. jeffrey, welcome back. nice to see you again. >> good to be here, judge. >> so you called in in february, late february, when the ten-year was at 2.87% the level quote makes a pretty good deal of sense right now what do you make of where they are today and why do they keep falling? >> well, they're really range bound is the way to characterize it once the stock markets start t getting wobbly in february b, bond fields kind of stopped rising they're contained now between 295 on the ten-year, which was the high close and down at 273 and now, at 278. they do make sense here. one of the most uncanny relationships most people aren't even aware of is that the ten-year has been tracking the average of german ten-year and u.s. nominal gdp almost exactly for the last few years in fact, even goes back 30 years that they're pretty close, so it's an indicator that people should get on the radar screen the german ten year seems to be pegged at about 150 basis points now. it did break above that, but seems they're back i

you will hear a side from him that you have not heard before >> let's talk about this gundlach thingportantly before we go long xop >> is it a short dollar p tretr? >> he's been spot on in terms of commodity and year to date i am confused by the short facebook but we'll hear more from jeffery of the reasons behind it. he's pretty accurate >> less than ten seconds you got a final trade name >> i am still with j. pchp. mor. >> that does it for us, "power lunch" starts now. >> good afternoon everybody, i am tyler mathisen, it is all about life at 3% yields on the benchmark and ten yr note hitting the key psy psychological marker we'll tell you what it could mean for you and your money. silicon valley, gathering to unveil their best ideas in this market, we'll take you there, live this hour and fortnite

we will talk to jim grant of grant's interest rate observer later jeffrey gundlach will join us withelds and a t lomore "squawk in the street" back after a break. ve lives. mr. stevens? this is your new name. this is your new house. and a perfectly inconspicuous suv. you must become invisible. [hero] i'll take my chances. when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. fidelity. you're still here? we're voya! we stay with you to and through retirement. i get that voya is with me through retirement, i'm just surprised it means in my kitchen. so, that means no breakfast? voya. helping you to and through retirement. >> what's the one sinking dow stock that could be on track for a major turn aunrod? we'll reveal the name on trading nation.cnbc.com. more "squawk in the street" coming up. whoooo. when it comes to travel, i sweat the details. late checkout... ...down-alternative pillows... ...and of course, price. tripadvisor helps you book a

gun gundlach does not think it could be sustained >> the re

whether i say i believe it's going to reach 3% because as jeffrey gundlach pointed out, it seems cheap. i think on this test, we get there, the only thing in your portfolio you made a big change to is what you did in january. and that's the bond proxy strategy that has been basically pared back in terms of what your allocation would be. but the rest of the market, no >> you could say the rates are rising for the right reason until you're blue in the face. the markets don't care about that necessarily, they only focus on the fact that rates are moving up. >> they do but i think this is the question that all investors are facing we've seen earnings 19%, 20% are those earnings gains sufficient to hold the market up in the challenge of higher rates. you watch that at 3%, i think you could see the stocks pull back >> at a moment last year, we had sold at a forward pe of something like 21. >> yeah. >> and a 24, trailing 12 and obviously, tax reform and the continuing improving economy changed it to some point but isn't it fair to say that probably if we remain around 3% on the ten-year we've

. >>> tjeffrey gundlach speaks to cnbc later today with his outlook on yields, the markets and more getights at 18:30 cet. >>> the u.s. ten-year yield snapped four straight days of declines on tuesday, despite slightly higher demand for bonds. bonds have just seen some fresh buying on the release of new tariffs on u.s. goods from china. we're seeing a fixed income reaction this morning. matt king, the global head of credit product strategy joins us to discuss all these things. going back to the flow data, some of your charts have shown that the flows tend to follow where the returns are. the fact that we've seen such big outflows out of equity markets, do you think that's signaling something about investors expectations of future returns there? >> we need to be careful because the money is coming out of u.s. equities but going into -- global equities, let's call it something funny happened they have not been as risk on as you would have thought for late global cycles, and in credit money has gone into investment grade funds but not high yield funds. it's been coming out over the last ye

executives, that's the sector that will outperform value will outperform over the next 12 months >> jeff gundlachecommending the xlp at the sohn conference thank you very much for joining us >>> today is one of the most interesting and potentially important times for the stock market in years. why? because we're likely to find out if your stock investments can go up at the same time bond yields and oil prices do. history says that may be tough if not impossible. look at this 20-year chart you have the dow, the oil and ten-year yield the dow is in blue imagine the chart. there yougo. green and red are yields and oil. oil and equities can go up yields have not really seen it let's bring in a man who knows history more than anyone, jeff hirsh of the stock traders i'll almanac. i don't think i can remember a time when all three of those went up at the same time can you? >> no you have to go back further for it to have more significance back in the '70s, even license plate days we had rates higher, going higher, stocks going nowhere for quite awhile >> that was oil and yields going up, but not equitie

now, one trade that became a topic of conversation throughout the remainder of the day was jeff gundlach's pitch to short facebook while going long oil and gas etf. one he described as risky. he said the idea stems from his expectation for more regulation around facebook. now, outside of tech, larry robins of glenview renewed his bullishness on the drug distribution industry, arguing that amazon is not a threat to traditional players. he touted long plays in mckesson and cigna express scripts and cvs/aetna, two deals that have been signed and not closed davidine horn said he was short due to the massive puerto rico exposu exposure they said iron horn, quote, demonstrates a fundamental lack of understanding of our business model and the municipal debt markets. assured guarantee fell in aftermarket trading. >> thank you so much you guys want to pick off some of these names, discuss? there were some interesting -- >> i would be surprised if the world didn't know about assured guarantees puerto rican exposure it's not a new story you're not inspector clouseau in covering it. maybe you are, i d

i'm happy about that, but the point -- >> we were having it on monday with jeffrey gundlach among others >> okay. >> he wasn't overly concerned yet. >> but now we're worried about higher interest rates. we're not worried about spread compression. really, what where want to drive at hereof because we're missing the pain point is the market is adjusting to where interest rates are. once they find their resting point, and it's not going to be 3%, that's just a fantastical magical number whether it's 3.08, whether it's 3.15, once we get there, the market adjusts to it, we resume the rally tromthere. >> 500 points in a day and a half on the ten-year barely getting over 3%. barely getting over 3% we're down 500 points. >> 500 dow points is 2% in a day and a half am i supposed -- look, if i'm a stock investor -- if i'm a stock investor, i have - >> you're suggesting everything is going to be fine. markets are going to figure it out and say this is okay it doesn't feel bad. >> that's what the market does two days, 2% decline, if i'm a stock investor, i better be prepared for that. as to where we

jeffrey gundlach was correct in terms of his that on an upward movement in the 10 year in terms of thehe is bullish on oil and energy. he came out with a big call on and energy etf's yesterday. he will be right again in terms of place to hide in the u.s. equity markets regardless of whether the 10-year sells off. anna: we will talk more and get to tech. theust had results from employment services company reporting revenue for the first quarter that met the average analyst estimates and let's talk van denvandenberg -- broek. business performing? what worries you right now? : there is not a lot of worries currently. europe is continuing on its good france --n southern southern europe it is still good. so that is good, the slight worry is the german market, there is a lot going on in haveny currently, there been some strikes. the german market is the toughest one to call but apart from that you are good. strengthening growth in the netherlands and the u.s. is flat but it has been flat for a long is stablet development with better earnings as a percentage. pretty good start of the year. ma

. >>> jeffrey gundlach will join us tomorrow. that does it for us. we'll see you tomorrow "power" starts right now. >> scott, folks, thank you very much welcome. i'm glad you could join us we'll tell you what's on the menu the president getting ready to hold joint new conference with leaders of the baltic states we will bring that to you live don't give up on tech, despite the recent downturn, one big money manager says stick with the sector he will tell us why he feels that way. >>> music to investors' ears spotify making its debut in an

what did you think of gundlach's double call where he likes energy, but wants to short facebook >> iike that guy i do not see any correlation with those two you know, the whole facebook dilemma, the debate going on, the thing we should concern ourselves with as an economy, all of these businesses that are sitting at 5 million, 10 million in sales can't live or acquire customers without social media platforms. the analogy is to look at why europe doesn't have anything equivalent to google, facebook or microsoft they regulated themselves out of the gate i am not -- i'm such a believer that the market will take care of the issues around security, data, all of that. i have also come to the conclusion, no one gives a bleep about this issue in the new economy. this whole thing that people care about their data is -- that are 30 and under, they xespend their hole day twhole day -- myo the regulators is do not kill the golden goose of efficiency if you can't acquire customers on social media and you're selling leg warmers or garments, you're screwed >> i'm with kevin, i think if you're right

yvonne: a great call we heard from jeffrey gundlach, he was shorting facebook as a trade.ting to see these gdpr privacy rules going into effect in europe. has facebook done enough? ivan: i think they will be proactive. benefit big companies like facebook and google because people are more trusting of the bigger, more established companies that can look after them. facebook and google have been customer friendly and focused, even though they are very large and people are often suspicious of very large companies. the users are on facebook and advertisers want to go where the users are. that is where the -- that is where the benefit is. yvonne: can we assume as long as facebook keeps investors happy and they generate these numbers, that will limit how much is zuckerberg is willing to adjust regulations and changes? it seemed a few weeks ago in his testimony he was open to it. ivan: i think they will be proactive. one thing one of the senators did say to him, you do not want business.ing our i am sure he thought, absolutely we do not. they will be proactive in trying to stay a

we will be interested to hear what jeffrey gundlach may have to say later today.ould temporarily push beyond 3%, it could not be on a sustained basis. we are watching for a potential breakout for the won. the currency has stayed fairly range bound, but it could move towards 1050 as geopolitical risk wayne. debt risk is also falling and that could help the won break into a stronger range. rise korea saw exports while imports grew 20.8%. that is something korean investors have to chew on today. the aussie dollar holding near a year-to-date low after iron ore dropped. metal markets have been very much in focus. that is coming off. let's check in on the bond space. want to highlight that drop in aussie and kiwi. nearly adding six basis points earlier in the session. aussie bond traders will have first-quarter cpi on tuesday, followed by ppi on friday. the cba expects prices to have moderated and it doesn't see any impact. yvonne: thank you. president trump is tempering the optimism on north korea despite kim jong-un announcing he will hold tests. the president tweeted

. >> all right and earlier this week jeff gundlach said he was shorting facebook >> that concerns ushe is pretty good. >> oh, he is i'm sure thank you, both. the shares still up 4% after-hours though >> they are. to me the regulation question is are they going to have a chilling effect on anything they want to acquire. >> or i wonder, too, julia said they're now 91% of their advertising is on mobile but what happens when the next platform is voice and reportedly they pushed back a little bit on those? >> it's the long-term shifts you have to be concerned with. by the way, everything pc-based for facebook, we should be talking about it it's this kind of stub end business that doesn't drive it >> tracking down everyone who still gets them. here's how we finished the day on wall street dow managed to hang on to a small gain the s&p up four. the nasdaq down 3.5. we'll see what the nasdaq did in particular time for a news update with sue herrera. >> hello, everyone here's what's happening at this hour a suspected california serial killer who committed at least 12 homicides and 45 rapes th

. >>> jeffrey gundlach will join us tomorrow. that does it for us. we'll see you tomorrow "power" starts right now. >> scott, folks, thank you very much welcome. i'm glad you could join us we'll tell you what's on the menu the president getting ready to hold joint new conference with leaders of the baltic states we will bring that to you live don't give up on tech, despite the recent downturn, one big money manager says stick with the sector he will tell us why he feels that way. >>> music to investors' ears spotify making its debut in an unusual direct listing we'll talk to an analyst who says you should get in now "power lunch" starts right now >>> welcome to "power lunch. ♪ play that funky music >> we're playing the song because it's turnaround tuesday. here are the u.s. markets. the s&p higher about i nearly eight points nasdaq in positive territory, but not by much. netflix, amazon, alphabet and facebook, they had all been in the green, that's turning around here in mid-session. auto stocks are seeing gains, hour, fee at, gm, ford, toyota, all h

. >> there you have it, jeff gundlach, why he's short facebook long xop and short facebook.today? >> so she recommended grubhub as a play on millennials and their tastes, no pun intended, and the food service >> and if you rely on it too much >> she, herself, does not like to cook frequently and thinks that's why it's poised to capitalize on this trend, and she said that compared to its competitors in other developed markets in europe, it's only up 4.5% penetration in the u.s., and it has room to grow there. >> surprised it's only 4.5%. >> that's what i said. >> there's a lot of skeptics about grubhub. leslie, great stuff, thank you very much, leslie picker with a recap, there's more to come on "closing bell. >>> straight ahead, much more on alphab alphabet's numbers and how you should play the stock. police, the battle over a stock that started the war on wall street >> i'm telling you, he's like the cry baby in the schoolyard not an honest guy or a guy who keeps his word >> how the story really unfolded >> and the next chapter in the icahn saga we're back in two minutes. z