Down again that reopening trade getting slammed. You can see that in the airlines there all taking a hit today later, check out this ride shares of avis budget, up 300 from the march lows. Getting a boost in the red hot used car market. The ceo will join us power lunch starts right now thanks energy and financials are leading the declines today they are down way more than that stall worth technology sector. Bob has more on this Early Morning reversal same story. Teches still out performing energy, financial, other cyclicals. Not a good start to earnings season big miss on earnings and very poor guidance. Walgreens has not been a good stock. Thats real problem. I think they may be basicing market mentality banks same story Huntington Bank was 5 goes to 12 its back to 8 again. Its an invertsed v. Whats moving the market theres five things. Is the reopening going well or not. Lets call it bumpy. Is stimulus coming maybe theres less good news on treatment advancing. Thats good news elsewhere, valuation, lot of talks some of these stocks are over valued. Some negatives here. The election, thats a wild card melissa mentioned this right around 10 00, when the announce m came the Supreme Court that the manhattan prosecutors could obtain President Trumps fj records, not congress the market drifted lower right there at that time look at amazon tech never goes down it goes down a bit and am zoazon bounces back look at caterpillar. Vr the Supreme Court hands President Trump a loss. Reporter sweeping ruling from the Supreme Court there were two baskets of subpoenas at issue one was a set of subpoenas from cy vance looking for president s financial records from his Accounting Firm and some banks the other basket was house democrats. Committees on capitol hill looking for financial records from third party, not from trump himself. Supreme court saying that cy vance will get access to those financial documents because there is no president ial presumption he cant be invest gatsed during the course of his presidency the Supreme Court said not so fast that process can continue. Not likely any documents will become public any time soon. If they are turned over, theres grand jury secrecy in that case and none of it would become public unless theres an indictment or some sort of criminal prosecution moving forward. That could be many months or years from now the house democrats, the Supreme Court not entirely buying their argument they needed to get access to this data saying that case needed to go back to the lower courts for reconsideration. Sort of a punt there the president frustrated by all of this saying the courts in the past have given broad deference but not me the president frustrated by the outcome here today where does that leave us heading into this life you see the biden bet over take the trump bet. You see now that trump bet is negative 9 . Biden plus 7. 1 . The big switch june 23rd happening right after that tulsa president ial rally that was so disappointing in terms of turn out and the number of reports about a surge in virus cases throughout the american south. Back over to you uncertainty surrounding the november election becoming front of the mind. Great to have you with us. You heard the split decision but one set back for the president at least for now does that change, in your view, how you view what the potential outcome could be todays event doesnt change our view i cant make a comment on the political combo. What i can say is that we laid out four different scenarios that most probable scenarios for the election and policies that might come out of that the good news is that in none of the scenarios based on our analysis were seeing a significant Market Impact that is as big as covid19 has done that said, the elections have consequences and well see winners and losers within the equity sectors thats a low bar when you say that can you lay those out and give us some possibilities if you have them . Yes of course. I think the key distinction here is whether were going to have a unified government whether wooelg have a divided government if we have a divided government i think the number of changes that might come is limited its a lot harder the push forward any tax increases or the spending legislation if we do have a unified government, whether its a blue wave or a red wave, we do believe that the outcome, the impact on the market is going to be close to neutral or slightly positive you have shown that the probabilities toward a blue wave have risen significantly over the last month and from High Net Worth investors perspective, the conventional wisdom is that would be negative for the u. S. Equity market and maybe other risk assets on a lesser extent our Analysis Shows that there are very good reasons to think that might not be the case this time around given where we are in the economy im glad you touched on that because one would think a red wave would be better for markets because of less regulation, maybe lower taxes and the inverse for the blue wave but you dont believe the policy conventions will hold true for the republican or Democratic Party this time around a blue wave might bring negative impact from higher taxes our Analysis Shows it will be a need for several more rounds of fiscal stimulus in the Biden Administration as well we do believe that theres a very likely chance the Biden Administration will have to focus on prioritizing economic policies that do promote Economic Growth because when the new Administration Takes office regardless of which side, it will be the First Quarter of 2021, the economy would still need quite a bit of health we think that unemployment would still be around 9 levels. Its still a risk. The key question is whether the fiscal spending stimulate growth enough and will it be enough to compensate for the impact of the tax increases and the regulation i think there are good reasons to think that it is possible of course, with the red wave, you have the risk of the trade war escalating again in a bigger way. Great to speak with you thank you. Virus cases are surging across the u. S dr. Anthony fauci is warning more shutdowns may be needed in the trend continues. Lets get to meg with those details. More than 62,000 new cases were reported in the United States yesterday by states that is a new record concerningly hospitalizations nationally have also been rising now reaching a level we havent seen since midmay even more concerning than that, we are now seeing an up tick in the National Number of new daily deaths reported in the United States you can see in the chart here from the covid tracking project. For states facing the most new hospitalizations, youre looking at states like texas, nevada and georgia, which have seen more than 40 increases in the last week the dark yellow there are the states seeing the biggest increases. Texas now more than 8300 people currently hospitalized also concerningly some states are seeing rising number of deaths following that hospitalization rate as well in texas, the 7day average now up to 47 versus 2 is in midjune to put that into context, new york at its peak was at 764. These are lower numbers but they are rising kelly, you mentioned dr. Fauci making those comments on wall street Journal Podcast about shutdowns. He was asked about that at an event. He softened his comments rather than thinking of reverting back down to a complete shutdown, we need to get the states pausing in their opening process. Looking at what did not work well and try to mitigate that. Yorng i dont think we need to go back to an extreme of shuttingdown. Saying we dont need to go back to stay at home orders across the board i was thinking about the discussion we had with tilman this week. Theres not a better standard for understanding when are we reopening. When might we close again. Right now it feels like every local authority is coming up with its own plan or calling it day by day i think that frustration you are out lining with a lack of clarity is something dr. Fauci has been expressing his frustration with as well saying there are guidelines that have been laid out at the federal level. These are guidelines that states and localities can choose to follow he said just follow the guidelines dont say open or closed go about it in staged manner and thats why hes so frustrated because he thinks states didnt do that. It could bebetter communicated and maybe harmonized thank you. Here is another shutdown leading the airlines as they n warn about layoffs well tell you what names are at most risk. The used car market is taking off. Thats sending shares of avid budget soaring well talk to the ceo later this hour chorstig aad experience the adventure of a bigger world in a highly capable lexus suv at the golden opportunity sales event. Lease the 2020 nx 300 for 339 a month for 36 months. Experience amazing at your lexus dealer. Experience amazing i am totally blind. And non24 can throw my days and nights out of sync, keeping me from the things i love to do. Talk to your doctor, and call 8442142424. Shares of the airlines are getting crushed today on reopening fears. This comes as united plans to layoff up to 36,000 employees. Treasury secretary Stephen Mnuchin explaining how the federal government will help one of the hardest hit industries. There are certain requirements in the psp. There are different requirements in the loan agreements this was all negotiated with congress and again, we have seened loan agreements in many cases, i think many of the airlines arent going to use them and will finance them in the Capital Markets. We wanted to make sure the airlines had backstop so they had liquidity. Thats something we have been focused on between the payroll support and the loans we have created a lot of stability for that industry for more on the airlines, lets bring in phil. The treasury secretary usage of the term backstop implies the loans will never will tapped they have until the end of september to tap this latest round of loans delta is one Airline People are paying attention to. He says, were not doing that great in terms of what we expected in july still down 30 in terms of flight schedule compared to last year delta says its august and its july schedule, its being hurt by two things. One the spread of covid19 in the sun belt states. Those are its a double whammy thats hitting the airlines we hear from ed likely next week when the q2 results come out thats when we get an update in terms of where they are on liquidity. You have united. It announced it plans to cut up to 36,000 jobs some of that will be through furloughs. Some of that will be through people taking early retirements. Some people will take unpaid leaves of absence. Well find that out over the next six weeks its scheduled for august. They pulled it back further. Its now going to be down 65 . Focus for the airlines is all about daily cash burn. They are bringing it down as quickly as possible. They are long ways from where they are in april. They are burning through a lot of cash every day. These are figures at the end of june united at 40 . Southwest at 20 million. Well get an update and see if its come down any further in july passenger levels, as you look at the airline index, still down 72 to 75 the numbers yesterday, down 75 . Its really started to plateau phil, stick around. Lets diver a little deeper into the struggling Airline Industry. See if investors should expect more pain ahead on these beaten down stocks. Hunter, is there any differenttiation do you think its all going to rise and fall with covid thanks for having me. At this point theres so much money, liquidity available to these airlines the Balance Sheet stuff is taking a backseat to the other fundamentals theres so many stocks that have zero equity values as far as i can tell theres still four or five billion dollar market cap because the market is pricing in just unlimited access to cash. Thats enabled by the fed. At this point, you should probably expect them to rise and fall we like focus on costs out the most who can be the most nimble by getting costs out, were talking about employees and roots, all of those things that are macro negative it can help them stay financially viable this is incredible to hear you say. Theres zero equity value and only able to have a market cap of several billion dollars because they can access the market who are those airlines that can make right sizing moves . Yeah, i mean the network airlines, delta, united and american have cut costs because they add the most. Thats basically math in terms of how much cost they have added over the last few years. Its going to be about who has sort of the fortitude to go ahead and just do it who will have the best abilities to look forward and predict future business travels. I think delta and unite stand out. At this point really nothing else furloughed 45 of their work force. You think theres any appetite for that to happen theres face level in terms of service is the government going to come in and say we need to add further support. I dont believer theres enough of an appetite in washington to come up with a second round of bail outs for the Airline Industry in terms of service, were at that base level. They are adding back some servers now. Youre not going to see a lot of service in the fall. Fall is fra ditraditionally a wr time of year theyre not going to add Service Beyond what we see in july and august if theres not an appetite for more bail outs, what ability do these airlines have to further tap the Capital Markets . We had united say they are aiming to get cash burned down by the end of the Third Quarter to about 30 million per day. If they arent able to do that or if for some reason they cant do that and got to raise more money, what else is there to collateralize in their portfolio . Theyve done everything. Some have, some havent they dont have much left. This industry, they keep taking money after money after money. They are never going to be able to restructure you look at what they did in 08 and 09. They didnt get a dime from the government they came out better than they were before. At some point this government stuff has to stop if they want any hope of being real businesses out there when you say who knows what happens after november, meaning what i just mean policy. In terms of Federal Reserve policy the fed is being extremely liberal in terms of politically liberal but both regard to pumping money into the markets theres a lot of debt issuance thank you we appreciate it thank you still ahead, tech, the only sector in the green today. Thats as the nasdaq hits another all time high. In the move in part due to semistocks holding up amid the sell off shares of nvidia hitting a record high. The traders will tell you which meth a sopg right after this when the world gets complicated, a lot goes through your mind. How long will this last . Am i prepared for this . Are we prepared for this . 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All of that has played into the hands of semistocks and that definite and the continued reliance on technology al helps. Those trends arent going to end. This is a broader trend that can last a long time you have been looking at the technicals is there a name that can out perform . The smh has done a very important move this past week. The Semiconductor Group has been a leader back in 2018 they gave us a nice Warning System in advance of the late year sell off there led the group higher in the first two months of the rebound in march however, it kind of slowed down. It slowed down and was under performing this week hast made a higher high thats key the low it made in march was higher than the low it made in 2019 a higher low now breaking to a new higher high thats very, very bullish. As you mentioned at the beginning of the segment, this is kind of showing the tech rally is starting to broaden out a bit. Maybe help the sense of piece start to play up with the nasdaq once again thank you for more trading nation, head to our website. Back to you. Ahead on power lunch, well continue to monitor these markets. The dow is down more than 500 points at the lows the nasdaq has clawed back to positive territory one bright spot is used cars the ceo of avis budget joins us to talk about why the stock is up more than 300 off its lows reopening roll backs slowing down the Restaurant Industry reopening the stocks most at risk, well dig into that when power lunch returns. I know that every single time that i suit up, there is a chance that thats the last time. 300 miles an hour, thats where i feel normal. I might be crazy but im not stupid. Having an annuity tell