Expects a renewed down turn. And with the big swings in the market, weve seen the vix, the volatility fear gauge above 53 59 minutes left in another volatile week. We have great guests david giroux from t. Rowe price. And shares of wind ham hotels Geoff Ballotti will join us. Lets get to the market now and another up and down session for stocks after yesterdays massive drop mike, you may be coanchoring to day. Youre not off the hook. We need your charts and your dash boards. Walk us through the action what happened . I wouldnt have it any other way, of course heres a one year, the s p 500, that selloff yesterday was a little bit destabilizing, it seems for the tape it didnt punk tour the air that this rally is inpenetratable it did hold today. Back down around the 3,000 mark. Theyre fighting it around that level. I did highlight this zone in here a lot of this area is still in normal pullback zone the rhythms of the market seem like theyre a little upset by yesterdays pullback you mention the vix also still elevated have to watch the bond yields. Treasuries compressed in yield today. So all that working together for a little bit of a cautious end to the week. But certainly Holding Together the longer term trend. Take a look at this chart. It shows the number of overbought and oversold stocks in the s p 500 the this is on a daily basis what you saw here is this historic drop. Look at. That we were above 80 overbought stocks. This is a measure of how much theyve gone up or down. It is below 20 . Actually lost 70 in from going in the overbought reading today. Only four other times in the last 30 years have you seen that drop so it showed you just really on a one day basis you bled away a lot of the technical excesses at least. And forward going basis, the other four times, you tend to do better in stocks over the next few months although, its not a decisive backdrop. People are saying were overbought and overconfident tape is stretched. We took care of some of that yesterday. We have to see though if you need a little more of a flush. Some people are looking at a bond market for clues on this rally. But with the buying this week, with the Federal Reserve saying rates are going to be rock bottom for a few years is that a tell right now for stocks its hard know how clear it may be the bond market may be suggesting about the macrooutlook it tells you something about risk april tights. When you see the ten year note, okay, holding around. 7. Thats down from above. 9 earlier in the week. Its been a little ebbing it is probably having something to do with this. Credit spreads, more important for equities they have softened up. They widened out a little bit in the last couple days not to critical levels i think thats the variable you really want to watch in terms of Equity Outlook from here thauction very mu thank you, mike. Lets focus on the airlines. Looking to end with another move higher here. Phil lebeau has the latest on the sector phil a big day again for the airlines this time to the upside, sarah take a look at the major airlines, big four right now, all of them up between 8 and 15 . Look at what this week has been like and really the last three weeks have been like for the airlines if you look at this week, between tuesday and thursday, they were down 21 to 31 look at the move that they had, the three weeks prior to that. United up 123 between may 18th and june 8th delta, one specific stock we want to highlight, it did close the Debt Offering raising additional 1. 25 billion and then you have american this is sort of an updated guidance noing really different than what theyve told us in the past. Liquidity target 11 billion by the end of the month and then the q2 revenue down around 90 thats the expectation at this point. Finally, take a look at shares of boeing. Senators are drafting a bill that would reform aircraft certification and how that whole process takes place. Thats according to a wire report that is out there weve expected this. So thats not going have a big impact on the stock today. Remember, boeing is targeting the recertification flight or flights of the 737 max by the end of the month big, big day for the airlines once again sarah . And everybody just continues to be amazed, phil, by how fast demand is coming back. The more than expected better than expected as youve been reporting, a lot of it Leisure Travel its almost all leisure how big of a portion is Corporate Travel a percent about and who is most impacted as far as airlines and that breakdown in terms if it was a regular market prekrid h. Covid1covid. Its not you and i looking for a deal to go down to florida at the last second. Can the Airlines Make money off Leisure Travelers . Yes. But not as easy as when theyre working with Corporate Travelers. Thats the real challenge for the guys now that corporate market, its dead in the water for the foreseeable future i may start to come back in the fall nobodys banking on it in the Airline Industry phil, thank you very much talk to you again soon turning now to the coronavirus a growing trend that wall street is watching carefully. Some local governments consider reimplementing shutdowns after an uptick in cases meg has that story for us. Hi, meg. What were seeing right now is local governments implementing pauses on the reopening strategies specifically oregon states governor last night saying that they are pausing for a week. Theyre reopening plans. So every county is essentially frozen where it is in their reopening. As they are seeing counts rising the they basically say this is giving them time to assess factors that are driving this spread they saw the highest case count yesterday, 178 new cases about 5200 total in oregon nashville also seeing the delaying the next reopening phase as theyre seeing a slight increase in cases over the last two weeks. Yesterday they announced 107 new cases just in nashville alone. Now we are seeing spread around the country, in florida today, they announced a new daily high in total cases and here we have the metro areas that are seeing their case counts double at the fastest pace this is data from evercorp the fast sest in phoenix, arizona, seeing case counts double every two weeks followed by tampa, charlotte, north carolina, riverside, california, and dallas, texas. Now some of this can be attributed to increased tracing and better Contact Tracing some cant be. And with he did hear from the cdc and its first public briefing in three months today essentially they were giving guidelines about how people should go about their daily life, practicing social distancing, wearing a cloth face covering, choose Outdoor Activities the they also gave guidelines around things like going to the bank or eating out, going to different businesses, even traveling overnight. This pan dem sick ndemic is note may need to see efforts increase if they get worse. Thats what were seeing in oregon and nashville. Theres a sense out there certainly in a lot of the wall Street Research on this topic that you read that there is a percentage there is a high threshold for when governors or mayors or other local authorities will go back to some kind of a full shutdown. Is that born out by what youre seeing yet can you talk about when they may trip over that threshold. We have not talked about anybody shutting back down again. Right now its what they refer to in oregon as a yellow light signal a stop, assess, figure out whats going on, figure out if they need to change something about the way they are reopening. Not yet talking about closing back up. So much of this is it better surveillance and understanding the epidemic that is already there or is it new spread which, of course, is most concerning. Meg terrell, thank you. After the break, imagine putting billions of dollars to work amid the market meltdown earlier this year thats exactly what t. Rowe as david giroux did the we have 50 minutes left of trade. We have the s p 500 up a little less than 1 well off session highs still tracking for a loss of more than 5 on the week stay with us on closing bell. Stock slices. For as little as 5, now anyone can own companies in the s p 500, even if their shares cost more. At 5 a slice, you could own Ten Companies for 50 instead of paying thousands. All Commission Free online. 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But the more than 5 decline for the s p 500 so far our next guest placed major bet on the market during the drop in february and march, buying nearly 9 billion in stocks and so far that bet especially paid off. Joining us now is david giroux, chief Investment Officer at t. Rowe price and five time nominee and twotime winner of morning stars fund manager year of theward in the allocation category thats quite an intro, david so what are you doing now after that bold move to buy back end of february, early march with the market having rallied dramatically off of 2200 level, we have pulled back our equity position which went from 55 of the portfolio in january and february to 72, basically the market bottom. And equity is so we come off the high but dont see as much much compelling value as we did, you no he, a little bit more than a couple months ago is that allocation 61 or 62 pretty much a benchmark level for you . Im trying to get a sense of whether youre more cautious than you generally intend to be because youre not seeing as much value or is there a macro call involved in that . No macro call its more of a bottom look on stock selection. We dont see many opportunities as we did a couple months ago. That 61 to 62 , i would say that is basically very consistent with our long term average if you will over time, you know, when were cautious likewe were in januar and february, well be that mid 50s. And we really want to be aggressive like we were in early 2009 and late 2011, well go to the low to mid 70s beyond just the price action and the tremendous runup of 40 or so that weve seen off the lows, david, is there anything that about the outlook that makes you more cautious right now than you were . The only things that happened is the price war changed dramatically so we went from a situation where, you know, the sky was falling and it was just this wall of negativity that, you know, prevaded everything that we saw commentary, if you will, in the marketplace and now there is more of a Glass Half Full environment with the market at 3,000. You know, we dont invest in the market we invest in individual securities concentrating list of securities so i would say that market at 3,000 is not compelling depending on, you know, how long the recovery takes but there are still large number of stocks and sectors out there where we see attractive opportunities to generate double digit returns over a two to three year time horizon that were still investing, if you will we were fine in that january and february time frame. We were just showing examples there of stocks you added to your portfolio it is a mix of some lodging names, marriott and hilton they would have got hit hard and then you have to bet on a comeback in business as well as morsteady names and yum brands is there a theme to all of that . In other words, you have majority of companies have suspended guidance market is giving Many Companies a pass on earnings for a quarter. How are you going about figuring out whether you want to bet on the steady ones or the cyclical ones that might come back . Its all really idiosyncratic, right you correctly identify there are some names in there that are kind of steady Eddie Company thats have fallen off quite a bit. You know, like utilities have had a really tough year this year that is kind of very surprising to me if you told me that the market was going to fall as much as it did, you tell me Interest Rates went where they were and utilities would be down 5 year to date in a market that is down 6 , i would have been very surprised by that. Utilities have really derated. Utilities may be offered it is the most attractive risk reward. Maybe the market goes higher or lower. Just the multiple utilities are trading at today, even if used the market on more of a nor normalized earnings basis, utilities look very, very attractive that is one end of the spectrum. The other end of the spectrum, whether it is a ge, a hilton, marriott, you know, kind of in the cross hairs of this covid19 challenge. If you have a two to three year horizon, you still make returns, strong double digit returns. I will say that the attractiveness of the names is still quite high clearly not as attractive as they were at the market made here at the end of march one of the reasons cited for the big runup in stocks is that, you know, there is no alternative, right this week we got the message from the fed that doesnt want to see yields rise any time and looking at yield cap if not stocks where . There are other asset class thats offer attractiveness, right . You know, i think the leverage alone market where you can still buy high quality leverage loans, you know, basically three, four year to maturity pieces of paper. You can earn mid single digit returns. If the rates increase, i think the returns there look quite compelling we added aggressively to leverage loans in the down turn and we continue to add there again that mid single digit returns with much less risk than the overall equity markets still attractive to us as well is there a group of stocks that you kind of were wo have been waiting to come into your valuation opportunities on that just didnt happen whether it is the mega cap Growth Stocks that did hold up better or any other thats you would look for the opportunity in any dislocations here . Well take whatever the market offers us we were kind of overweight going in the amazons, the microsofts, the googles, facebooks we were overweight going in. Again, its those kind of names that have been kind of, you know, done very well in this environment. We have, you know, reduced our exposure for the majority of those names during the crisis. Whatever the market overvalues today which is safety, which, is you know, having a rated Balance Sheet or net cash Balance Sheet, we want to see the most value. That is not in companies that have a rated Balance Sheets or in companies that are covid19 beneficiaries. We want to take a little longer time horizon in the market and find value david, its been great getting your thoughts today. Appreciate you joining us. Thank you david giroux. We have a market flash on amazon we have the details. Mike, amazon shares are down about. 6 on pace for the second straight negative day. Now a number of headlines regarding scrutiny of the different businesses as cnbc reported, amazon warehouses will be interviewed by the new York Attorney r attorney general in a retaliation probe. California is also examining amazons Business Practices in regards to competition with third party sellers. The that one coming from the journal. Also today, a San Francisco lawsuit is filed accusing the company not properly sanitizing the workplaces or uniforms of employees at amazon fresh. We should note while shares are down, they are off the lows of the day and theyre on pace for their sixth straight positive week back to you. Thank you very much we have how many we have 38 minutes to go before the bell you see the dow is holding on to gains. About 1 s p 500 up. 6 the s p 500 was am will you please 3 at the morning highs value is, again, outperforming steady growth names. Up next, taking sides on tesla stock hitting a record high earlier this week. A pair of firms e thkiarreinng their estimates. As business moves forward, were all changing the way things get done. Like how we redefine collaboration. How we come up with new ways to serve our customers. And deliver our products. But no matter how things change, one thing never will you can rely on the people and the network of at t. To help keep your business connected. Makes it beautiful. State of the Art Technology makes it brilliant. The lexus nx experience the crossover in its most visionary form. Experience amazing at your lexus dealer. A little over 35 minutes left to go heres a check on the markets. Sort of in the middle of the range. We were as high as up 880 or so points on the dow. Lost all of that went negative. And now back in positive territory with the dow up 228 points s p 500 up. 4 the real estate stocks are actually the winners today best performing sector, Consumer Staples the worst. Lets check in on individual Market Movers at this hour tesla shares slipping on the back of a double dose of down grades morgue an stanley citing risks associated with the u. S. China trade relationship demand there and tech economy tigs fcompetit. And downing the rating to neutral and raising the prit target saying it is positive on the companys long term outlook. Tesla is down more than 5 and hertz shares spiking the company asking its bankruptcy judge to allow a secondary Stock Offering and is looking to raise up to 1 billion in new equity. There is the share price it continues to go up, mike. What do you even do with a Stock Offering in bankruptcy if youre able to rai