Members. Profittaking could be a motive and remember oil rallied 27 in april. Drug prices are under fire on capitol hill. As you well know, glak glak sews an dry witty will be talking. Jackie deangelus has a story from us from the nymex. Good afternoon. Closing under 45 dlp a barnlts. You mentioned opec. Thats certainly the big story today. Analysts sur vaved expected to see opecs production going up from march. Traders tell me theyre not surprised by that at all. If we do see some sort of a freeze or accord, of course, these producers want to freeze at record levels so they can continue to pup its economic for them. Whats going to influence oil within the next month or so, certainly supply. The dollar weve been discussing all day as well. Thats another piece of it. The dollar index is support ivg of crude prices. It could take us higher, especially if the dove continues to be. I know youve watched the gas prices closely. Theyre going up. Consumers are expecting to hit the road. Theres one other piece to the demand equation i want to mention here. Traders, analysts alike are look internationally. Were not seeing an uptick from europe which is typically the place wed expect to see it. A lot of people are talking about whats happening in india. A lot of iranian crude is flowing there. That went up to 17 million barrel as day in march. When it comes to market share, this is all a big part of the story. The saudis and the iranians fight for this share, and theyre looking to india right now which is looking to grow at 8 . We could see a little bit of movement there. We do know this. When it comes to supply and demand, if the producers dont, youve got to see an uptick in consumpti consumption. Back to you. Jackie, thanks very much. Interesting that we see oil going lower and stocks higher. Sure. Were not getting that correlation weve had for so long. Shares of halliburton higher today. Youve probably heard the two Oil Services Providers have decided to call off their 28 billion merger after opposition from antitrust regulators. If youll recall back in march i spoke with Jeffrey Ubben about baker hughes. We felt the spread wasnt quite big enough that we would buy both. But the spread is one that weve gone completely into baker hughes. The reason is if it happens, well do really well its 25 spread. I think people wonder what happens to baker hughes balance sheet. With us for more on this is robin shoemaker with Keybanc Capital markets. Robin, weve heard some news out of baker hughes. You know, be from halliburtons point of view, why agree to that . Did they have such confidence it would improve . They had confidence. They insisted on a huge breakup fee because they were concerned at what happened yesterday is exactly what would happen so they insiftd on a very large a breakup fee and halliburton agreed to that. You maintain your view, why is that . Halliburtons stock was up a little bit, investors relieved they did not overpay for baker hughes. You know that price was set 18 months ago when oil was much higher. For baker hughes, i think its a recovery story. Theyve outlined 500 million in cost reductions they intend to take right away and theyll pay down some debt and buy back a billion and a half in stock, but their case for the Investment Case for baker hughes is a little bit longer term, and, of course, were in a severe downturn for both companies in terms of environment. Thats interesting because it came up this morning when Warren Buffett was asked his thoughts on squawk box. It sounded initially like they were putting together two companies that were either actually twal or potential customers in many ways. Thats the job of the trust department. They are to look for when things are anticompetitive. And my guess is that certain competitors of those two companies objected strenuously. We know the firms after schlumberger, robin. Whats interesting is he said they let the airlines go through in some cases because the industrys profitability was so bad, but now with oil prices so low, could the same argument have been made for this deal going through instead of being blocked here . Well, it wouldnt have made as much difference for the Competitive Landscape today, but if Oil Prices Recover and a few years down the line there is great demand for oil field services, thats when they were concerned it would make a big difference in terms of the cost of drilling. Thats why they oppose the merger. So what does this now do to the dynamics of that center . Does it is it based on what the price of oil does or not at this point . Thats the main factor. While the oil price has drifted up a bit, its still above a level that would encourage Oil Companies to start increasing their drilling budgets again. We think that price is around 50. Youll start to see a little bit of improvement in demand for oil services, but so far its just been down quarter after quarter, and that includes the current quarter. Robin, thanks for joining us. Thank you. Robin shoemaker with a look that wasnt today, one of many, by the way. All right. Lets talk markets at the closing bell. Larry glazer from may flower advisers is with us. Rick santelli checks in from chicago as well. Ben, 113point gain. A good start to the month of may. Whats going on here . What are you watching . 26 million merger falls apart. Thans the power of the oracle of omaha. His positive comments about amazon got the juice under this market even in the face of falling oil. Keep an eye on asia but particularly china. Theres this thought that they theyre. We know the last few weeks there were 08 super tankers lined outside the ports of china. When that stops, think oil is in for a very hard landing. Larry, what are you watching and is the Place Investors need to be . I think great points are being made, love is in the air. Love is in the face of that puerto rican debt result. Those are major mackerels. Look. Full discloser. We do own some Berkshire Hathaway. I had a diet coke for lunch and my wife loves dairy queen. I think with that said, its not immune from a few dogs. Hes got problems. His stocks have gone nowhere. Thats the issue here. Either chase the momentum and chase the crap or wait for the good stuff to pull back, ibm being in the latter camp. Id be a little more patient. Rick, it does seem that the markets are taking the puerto rican default in stride. What do you think it does to the credit markets right now . You know, im thinking we receive a lot of what its going to do, which is a lot of nothing. I think the Biggest Issue personally and theyre hitting very close to home is how whaufr outcome we see over time of puerto rico, how that may feed into Something Like an illinois chicago situation. Of course, many are watching that closely. As i look at the markets today, the biggest thread that all traders and my sources seem to have shared is the weakness in dollar, the strength in gold, and how big and mackerel some of these events are when you look at the charts. So especially the current dollar index. You need to pay attention. Its the lowest since 2015 and if you look at the year preceding that. Theres a lot of room here. I think these issues will come home to roost and i think that investors also are experiencing lots of ill logic market moves. Whether its the strength of the dollar. The way the stockmarket refuses to give it up when the fundamentals have been a bit lacking and based on it, well have two jobs reports. It will be interesting to see how they digest that in lieu of policy from the federal reserve. Quick followup, rick. Anybody guessing how much higher gold goes . I guess it depends on the dollar in part, right . Yes. Theres many of this Trading Floor that thinks theres hundreds of dollars left on this move. Looking at the charts, i would tend to agree. Did they always think that, rick . Pardon . Did they always think there was hundreds of dollars or is this a good thing . Good point, kelly. Theres also optimism on gold. Honestly i havent seen this much concentration among traders who turned a bit skeptical when it had its downturn. So even throws a lot of truth in your question, i think this time theres a little extra horsepower. Larry . Rick, some of that gold move potentially is a hedge against that disaster, that may crow concern coming out of japan. I think theyre saying what do i own if something really goes wrong here and i think it illustrated the issue of when you have a really crowded consensus trade coming into the year like a strong dollar, like an antioil, antigold trade. Things can really blow up. I think its an opportunity for us to keep our heads. Totally agree. But i think its even more. I think add it all up, and its a big mix. Hey, ben, before you, you sound a little skeptical about this rally, giving some of the reasons why it shouldnt be going up. So what levels are you watching . Actually weve had a great performance. We got through 2071, so this may have some legs but i have been worried about it. I was trading from the long side from friday because eight of the last 11 years the market has seen an up move after the Berkshire Hathaway meeting. Its a strength in the dollar and dropping dollar and dropping oil in the middle of that, but commodities, the crb index all the way through oil, corn, some of the other softs continue to drive the markets. Im still looking for some of the breaks to the downside. But the move to the upside today is far more than i had anticipated. Very good. Thanks, guys. Good to see you. 45 minutes to go. The s ps up 15 points. The nasdaq participating too. Actually the outperformer today. We mentioned amazon, some of the other movers. Its up 38. Up next, how will the president ial race and all the market chatter of selling in may affect the markets as we begin the fifth month of the year. Also ahead, glaxo smith ceo speaks with us about new drugs in the pipeline. Youre watching cnbc, first in business worldwide. It was a simple idea. For every pair of shoes we sold, wed give a pair to a child in need. At t has been with me since day one, keeping me connected to my team, to my business, and to the reason we put giving first. Toms started small, but now weve given shoes to more than 50 million children in need. Im blake and this is my network. The network of at t. This just got interesting. Why pause to take a pill . Or stop to find a bathroom . Cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. 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Whats an investor to do as they compete with a cacophony of president ial candidates. Mike santoli back in business has written a piece on cnbc pro and hes here. Good to be back. Nobody broke anything. Theres a good republican for the sell. They have come between november and april. And may through october if you sat out the market, you sidestepped a lot of bad stuff, but i think this year theres an extra intensity of talk because we have a socalled open election year. Obviously both parties are nominating somebody and, of course, its very contentious. If you look back at the heistor of those in particular, they performed badly. I think we have to take this with many, many grains of salt here. 2008 and 2000 were the last such years when you had this open election. Obviously we had financial crashes. I dont think anybody looks back and says its because of the political landscape. Also the sample size is so small. There have been four open elections in the last 50 years. Since 1996 there have been achlt you cant necessarily rely on them. Im totally on board the election this summer can get noisy and ugly and its going to keep economic discontent very close to the surface. To me the calendar is not the thing to be most concerned about. Its funny. It goes back to that whole point which, you know, you come away from a weekend of talking aboutf the goal is to rise, that fines. If youre looking at some business that you want to invest in, even if theres some selloff based on it, no big de. I think thats what Warren Buffett has done. Hes got the benefit of 60 years of always looking to be a buyer and its kind of worked in his favor naturally. So the best six month os testify year was supposed to be november 1st through last friday. The market did nothing. It was down slightly. But as one pointed out to me, its typically the latter part of may as the selling begins as we get to it. The summer is definitely where things could obviously get choppy. You have a lot of things. Its fundamental reasons why. You have the fed inplay and all the rest of it. Yeah, theres many reasons to be concerned. I just feel were kind of overplaying, i think, the significance of some of the seasonal stuff out there. And the earnings beats, i mean those lowered expectations have helped to some degree. So far its been enough to hold things together, yes. I know where you went so im surprised you really are glad to be back. By the way, you can read the full article that mike wrote at cnbc. Com pro. 40 minutes left in the trading session with the dow up. Holding on to pretty good gains to begin the month of may here. Glaxo kleins ceo spooe speaks with us next. Later insurance giant leads todays rounds. Well tell you what analysts are looking for and when it happens well break it down. Still to come on closing bell. Here at the Td Ameritrade trader group, they work all the time. Sup jj, working hard . Working 24 7 on mobile trader, rated 1 trading app on the app store. It lets you trade stocks, options, futures. Even advanced orders. And it offers more charts than a lot of other competitors do on desktop. You work so late. I guess you dont see your family very much . I see them all the time. Did you finish your derivatives pricing model, honey . Td ameritrade. We built our factories here because of a huge natural resource. Not the land. The water. Or power sources. Its the people. American workers. They build worldclass products. And that builds communities. And a better future. For all of us. Because making something in america means so much, to so many. Weathertech. Proudly made in america. 37 minutes left. The dow is up and holding. Boy, its been pretty quiet. The s ps up 15 at 2080. Yu heard ben willis say once it got past 2071 it waufs to the races on the upside. The nasdaq up 38 points. By the way,er is rep ta therapeutics is rising. Oppenheimer changed it from outperform to perform. Oppenheimer expects the fda to approve the companys new drug to treat deshane muscular dystrophy despite the panels high profile definition last week not to. Its pushing it 17 higher, almost 18 higher today. Joining us now we welcome backglass galaxy oh kleins ceo sir andrew witty. Good to see you. Thank you. Theres been a lot of talk about drug prices. Is it fair that it far outwags. Would you agree with that . I think what were seeing in the u. S. Things have to change and theres a few things that have to happen. First of all we geefbet to understand the list price is nowhere where what it is. Discount price is 45 . Secondly in certain areas were seeing intense competition bring prices down. Overall were seeing drug prices at the net level reduced. At gsk over the last two years we receive a negative price impact at the net level. What were also seeing is were trying to hard to introduce new technologies at more affordable prices. In fact, our last six medicines launched here are at or below the price of previous technology. What weve all got to do is get likeminded people together from government, from industry, and start to really sort this out. There is a lot that can be achieved through some more transparency, through some simplification of regulation. Withve good to make sure were Getting Better money. You know, ive heard it suggested by investors in the pharma space that, you know, this has been a volatile climate for years now that, you know, youve about had these Big Companies with these mega blok buster drugs and then that whole period ended and oust that sprung valeant. But that people have really tried hard to figure out what is that next area. You know, how are we going to backfill the pipeline . How are we going to develop new kinds of treatments and products . And you guys have sort of been in the middle of that, right . How difficult is it to read the tea leaves and try to continu continually reinvent yourself . Its hard to reinvent but its not hard to read the tea leaves, kelly. Discovery of meds and vaccines have made a real difference to patients. Thats what weve dub at galaxy o smith for the last seven years. People have been critical with how we embrace and move things forward. I think the reality is we have to make sure there arent any shortcuts yochl u have to make sure youre connected with biotech and academia and you have to be patient. Have to bring the new meds forward. The last five years weve had more drugs approved by the fda than anybody else in the u. S. We now have launched six new drugs which are 20 of our new business. Thats oldfashioned Drug Discovery taking advantage of new technologies and weve turned our face away from some of the more novel business approaches which a lot of times look interesting in the short run but dont have the legs in the long run. I think what youre seeing from the Big Pharma Companies is a real commitment to innovation. What we want to do is work with pay yores and policy makers. Even at glaxo, you look at it. The revenue has come down. You guys are into vaccines, youve made a swap with novartis and in other areas. Is this a case where, you know, at some point you say, hey, we need to do a big acquisition and just kind of go back to that size first aspect here or could you actually be better osbon. Of smaller more focused units . We really like the model we h