Transcripts For CNBC Closing Bell 20150415 : vimarsana.com

CNBC Closing Bell April 15, 2015

Floor of the New York Stock Exchange have been thinking about all day today, late in the session over in germany, the dax index had been in rally mode until the very end. Look at that selloff. Fell out of bed. And finished with a gain of three points. Some of the traders are wondering if the same thing could happen here in this last hour with the dow up 108 points. Just something to think about as we go toward the close. Well keep an eye on that here. Meantime, also an hour from now, netflix will be reporting earnings. That stock has been up 38 just this year. Its now approaching 500. Its 474 right now. Could the earnings push it past that mark . Its been very volatile. Well have the numbers the moment they cross the tape. Well have some of the best analysis on wall street coming up as well at the same time. Also in one hour the treasury secretary of the United States, jack lew sits down with sara eisen. So much to get into with him. What does he think about ted cruz wanting to get rid of the irs . Stay tuned for this important interview. In the meantime lets get you caught up on the markets. Rally mode as we said the dow up 104, comfortably above 18,000, the s p is up 14. The nasdaq up 41 points right now. Comfortably above 5,000 as you mentioned. Meanwhile, oil surging today, huge gains there. Lets go to Jackie Deangelis whos standingably by at the nymex. We were up 3. 10 in your 6 move wti finishing at 56. 39. Now, first reasoning for this was that we got an eia inventory report this morning. It was a small build, much less than weve seen in recent weeks and months. Traders took that as a positive sign that the supply demand balance is starting to come into play for the bet per meantime geopolitical tensions in the middle east also causing some nervousness. Definitely adding to the upside movement here. But still, on the fundamental side its going to take a while to work itself out. Technically we keep driving higher. The question is really is this a head fake or is it the real thing . Have we finally found a bottom . I will tell you this weve seen a lot of volatility this year. Moves of 4 to the upside and the downside, 22 times this year. Those are big swings in either direction. So its really hard to say if todays move is really monumental or not. The market certainly will tell us in the coming days. Back to you. That is for sure. Jackie, thank you very much. Lets get to our closing bell exchange. We have a lot to talk about today. Keith vincejeryl is with us. Meg green, interestingly is the head of meg green and associates. Nathan bacharach from simply money and Rick Santelli joins us from chicago as well. Keith fitzgerald a lot of trepidation about the earnings to come. So far theyve been better than anticipated. Youre not surprised about that, are you . No, im not. I mentioned a couple weeks ago i thought that was going to be the case. Im suspicious because the derivatives exposure they carry. Im encouraged here. This is all about confidence right now. So far, its holding. Jack what do you i dont i this of the earnings so far . Larry kudlow says earnings are the life blood of stocks. As the financials come out, break down the numbers. The trading numbers are actually bigger. These companies, these banks, these financials are making money trading throughout all this volatility. Thats something that doesnt translate into growth down the year. Nathan bacharach, the bar was set low in terms of expectations. But we shouldnt get too carried away with the kind of growth were going to see from the First Quarter. Theres not going to be much to write home at all about. This market is trading on fedmentals. Growth is moderate. Its okay to start trading stocks again. On the other hand, whats, i think really curious, we say this from a distinct midwest perspective, wall street is waiting around for the consumer. Our simply money survey is clear, the consumer is allowing that money its a happy accident, building up in checkings and savings. 20 of people are spending the savings theyre seeing at the pump right now. Main street is saying you know what, i go to costco things are cheap. I dont worry too much about corporate earnings out here in the midwest if im a consumer im very happy with the way things are. Wall street, you figure it out. By the way, the way wall street is figuring it out, we have a high jump called earnings. We put the bar on the floor and say can we jump over it. Meg, what do you think of the earnings picture at this point . Are you satisfied with it . And what does it lead you to do when it comes to what youre buying or selling . You know what im satisfied with the earnings but the s p is up 2. 5 this year. Take a look overseas take a look at the emerging markets. Look at europe. You have to be balanced and diversified. This is a call for diversification. Were definitely stock picker as opposed to index. If youre not balanced and diversified, you are missing huge returns. Europe at bay, emerging markets up 9. Within there theres always kinds of problems going on. Its a ball anded portfolio. The s p is part of it. The dow is part of it. Why is it so strong is that because of quantitative easing . Is the same going to happen in europe do you think . Ecbonomics. Bingo, michelle. We called it. Here it is. Theres no surprise. People who were running away from europe and the emerging markets, remember boys and girls, buy low, sell high. Its a great opportunity. It was, to get into those markets and theyre flying. We saw this happening. You have to hedge that position. You cant go running over to europe and not have a hedge position. Thats the comment about balance. Youll go, how come when i translate it into dollars i didnt make a lot of money . You have to have a hedge over there. Hang on, hang on guys. Let me bring rick into this as well. He wont start until we acknowledge him here. What do you make of all the moves in the markets today . Oh, goody. A huge rally in oil, the collapse of the dax late in the session whats going on with the dollar here . The Interest Rates, whats the big feature for you today . Well it was what about three months ago where the average headline i was reading every other email was energy, a ticking time bomb. Well, it didnt really turn out that way. I think when you use a commodity as aggressively as energy with the geopolitical world like we live in im not shocked. Did i call the exact day or the exact week or month . No. But it makes sense. As far as whats going on with the dax, exhibit a, lets look at a 24hour chart of the euros versus the dollar. Thats volatility. It looks like a crown, up down up, down. Thats going to continue. In terms of the bar being low in terms of earnings we all know thats true. I continue to say, you know whether its corporations that are buying stock back because the real mother milk of this market is low Interest Rates. And everybodys in. Whether its corporations whether its the end user, i continue to think that the main feature is, its going to all continue because Central Banks are just not going to be able to do much about it. Even china. Whats the story today . The weakest growth since the crisis. Whats the residual story . Well, what kind of stimulus are they going to do . Thats what were conditioned to do. 7 7 growth in china. Guess what i take 7 growth here any day. Absolutely. All day long. Thats not real growth, though. 7 is not real growth. The way to change that matters. The thing that were seeing in china, all right, is a turn a turn takes a while. This is all part of the Global Growth story. Pay attention, not only to china but what is going on in mumbai. Look at kuala lumpur. The world is coming together. There is a Global Growth story and we are going to be the beneficiaries when we talk about this mean a fedmentals market or a feddriven market every market is a feddriven market. Ive been in this industry for 30 years. [ talking at once ] china is growing to slow down and what were talking about here is a long runway for china. So china, the only thing china can do is mess up the party by having more uncontrolled growth. I dont think they play a major role moving forward. They nullify themselves. China is the 800pound gorilla in the room. They are the undisputed kings of capitalism for now. Theyll play a role for decades to come. Youre absolutely right, keith. Theres no need to think theyre going to go anywhere. What does it mean right now in terms of what you do with the stock portfolio . Do you focus day to day on whether china is growing 7. 1, 7. 2 or. 7. 5 . Or do you buy netflix . You do what every qualified ceo is doing, youre looking around the world, assembling a portfolio of growth something that will produce earnings in the future. China, its a part of their investment portfolio. I dont care what s p company it is. Thats how the game is played. To think that china will go away people have been making that call for 40 years. For 40 years theyve been dead wrong. Those who have gone to china have done very well. Thanks, guys. Very spirited. Yes, we never have to work very hard with these guys. They take off. We just have to hold them back a little bit here. Good to see you all. Thank you for joining us. See you later. 49 minutes left in the trading session. So far, still dae sent gains with the dow up 106 points the s p up 14. S that back nasdaq has been the standout. Netflix reporting earnings after the bell. Well bring you the numbers the second they hit the tape along with instant analysis from the pros. Stock has been on a crazy tear this year, selling off a little bit before the numbers are out. Up in e, for the First Time Ever americans are spending more money eating out than they are on groceries. The experts will weigh in on what this says about our economy when we come back on closing bell. Stay tuned. Doug. Youve been staring at that for awhile, huh . Listen, Td Ameritrade has former floor traders to help walk you through that complex trade. So youll be confident enough to do what you want. Ill pull up their number. Blammo. Lets get those guys on the horn. Oooo looks like it is time to upgrade your phone, douglass. For all the confidence you need. Td ameritrade. You got this. 45 minutes left. Rally mode today on tax day. The dow up 99 points. Lets show you the ten sectors inside the s p 500 index. Nine of them are positive with that huge rally in oil, energy leads the way to the upside up 2. 25 . Consumer staples are the laggard today, down a fraction. We have the beige book out a little over an hour ago showing slow steady growth. Didnt have much impact on the markets here. Lets talk to steve lease maniesman who joins us now. He has takeaway from the beige report. Its worth pointing it out, its a collection of economic anecdotes from the 12 Federal Reserve districts compiled into one place. It says a little bit weaker growth. The beige book saying Economic Growth was moderate slight and steady depending upon what district you were in rather than an overall moderate which weve gotten previously. It blamed it on three factors that weve been talking about, the strong dollar and harsh weather. I want to go into the detail about the effects of the strong dollar. Most of them negative. At hurts chemical experts in dallas, a falloff in canadian shoppers, that can be any kind of shoppers in the United States, was reported in new york and overseas manufacturing profits, we know this story, quote, down significantly. Then i want to turn to the other big thing, oil. They talked about oilrelated layoffs in multiple districts that were out there. Heres some of the details. Energy suppliers, these are the folks that supply the equipment to Oil Manufacturing were hurt in five districts across the country. It helped tourism in the atlantic district which includes florida, because people are driving now. Drilling rigs are down, but production was strong. Lower manufacturing prices were seen in chicago. A little give and take. It was bullish on real estate in language that i had not previously seen. I want to show you an exact quote if the beige book here. Context across the system uniformly reported they were optimistic and many expect a greater than normal upswing in home sales. So maybe that weakness guys is behind us. Some of the strength in the economy, especially, Residential Real Estate could be yet to come. We just had a long discussion with our market guests who are pretty divided. One guy was like the u. S. Economy is taking off, were at the turn now in the time. And saw it as such a reason to buy stocks right now, steve. From what i could tell theres three forces out there, the weather hurt us in february. The dollar seems to be hurting us although there are some positives not as apparent and then theres oil prices. Some of this stuff will be working out over the next several months. I dont feel like were on the cusp of a boom here. Some of the bounceback of pronounced weakness seems to be in the cards. Dont move. We want to talk about another story that can be seen as a different kind of economic indicator. This is a great story. According to new data released by the Commerce Department last night, americans spent more money to dine out than they did on groceries in the month of march. First time thats happened, going back to 1992. What does this say about our economy right now . Essentially this was millennials versus baby boomers. You can guess which way we were going. Joining us now along with steve is chris lowe from ftn financial. What do you make of these numbers . I presume you believe them. Why do you think theyre happening . Its very much a story about demographics. Its baby boomers who are trying to save money, you know. They undersave for retirement. Theyre eating in more but there are more millennials than boomers. And they tend to be frugal but they also tend to live in cities and they like to eat out. They like to customize their food. And this is a combination, not just of sales in restaurants but also people taking advantage of apps like grub hub and seamless to get meals sent to them. What do you make of that steve . This is very much a demographic story and the demographic change were seeing in this country, the boomers have dominated for so long. Here come the millennials. They are a huge portion of our economy as well. What do you make of the impact theyre going to have . I agree with what chris is saying. If you dont mind, id like to talk about a different aspect of it. I want to talk about economic cycles and what this says about where we are. We had a case of eating out interruptous. Were those lines back before it flattened out, the orange line flattened out . Thats before the financial crisis. We were on track for eating out to become bigger than groceries and buying food at the store. But the financial crisis came along, people started to save. Now were getting back. When i see this bill i see a return to normalcy a return to the prefinancial crisis trend, pre prerecession. I think people are feeling better about themselves, able to go out. Its one of the first discretionary items that is cut. I think there is a demographics story there but also what we see is food and restaurants have found a way to deliver ral yew at a lower price. I dont know anybody better than michelle who understands the economics of that. Speed and i think theres a lot of faster eating options, right . Faster, better but not crap. Thats the thing. You can go out and quickly and relatively inexpensively yes. When people come over from other countries, they cannot believe the ratio of food over price in this country. Thats so true steve. Im glad you brought that up. Lets bring up that chart. You no he what i noticed about this chart . Were all eating more. Its all going up. Were eating out more. Is that population inflation or are we getting heavier . Let me point out another wrinkle, chris. Millennials are eating out but theyre eating fast food. Theyre not eating at the fast casual places. Theyre eating the cheaper food thats out there. So are we really going to see a growth rate in spending down the road when both of these huge demographic groups are not going to be big spenders . We will. We will see growth but youre going to have to see some changes in the industry. One of the best examples of that is traditional restaurants like mcdonalds suffering because they dont offer that customization where others like chipotle that do are taking off. There has been a shift in preferences as well that goes along with this. But i do think steves point about this being discretionary is key. This is one of the almosts that makes me optimistic retail is going to come back in the second quarter. You know what, steve, really quick, theres a caveat here. They didnt include Grocery Stores at places like walmart, target and costco. Theres been a big shift as well. It could be the way they gather the data is antiquated. People buying in bulk and transferring the inventory from the farm or the warehouse to your house. Thats whats been happening. I think thats a significant part of it. That probably is left out. I like your point earlier, michelle, everything seems to be on the way up. If you ask a person tell me one thing youd like to be relieved of from your responsibilities . Cooking or cleaning up the dishes. I have a rule at my house, the cook doesnt wash the dishes thats why i do the cooking. Im still wait for the dinner invitation. You got it. All right. We have about 37 minutes before the closing bell. The Dow Jones Industrial average is up 101 points. Triple digit gain still. And the nasdaq is well above 5,000, a gain of 40 points at 5,017 right now. You know what etsy is. Yes. Theyre gearing up to price their initial Public Offering tonight. Should you buy the stock when it starts trading tomorrow . We have a bull bear debate whether you need to put shares of etsy in your portfolio . Central banking head this morning. What do we call this . We call this a glitter bomb. Right. Well explain later. It was a scary moment. Well explain later on closing bell. Big day . Ah, the usual. Moved some new cars. Hauled a bunch of steel. Kept the supermarket shelves stocked. Made sure everyone got their latest gadgets. Whats up for the next shift . Ah, nothing much. Just keeping the lights on. laugh nice. Doing the big things that move an economy. See you tomorrow, mac. See you tomorrow, sam. Just another day at norfolk southern. Bring us your aching. And sleep deprived. Bring us those who want to feel well rested and ready to enjoy the morning ahead. Aleve pm. The first to combine a sleep aid. Plus the 12 hour pain relieving strength of aleve. For pain relief

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