Thank you. Its been weeks. Nice to be back. Hi, mom. Here we are again. And happy birthday. Yes. Retail earnings, that helped send the stocks to record levels yet again today. Well talk about how much the market is up since i was gone, but whether this is provision called the border adjustment tax, could that stall the rally, especially as it pertains to Retail Stocks like the ones were seeing rallying today . Well talk about that coming up. White House Press Secretary sean spicer was just asked about that tax plan. Well bring you his comments shortly. Warm weather in the east made for a nice weekend. Its crushing nat gas. Its down 9 . I cant believe youre playing this song. Are you sure wells fargo, that saga it turns out is far from over. The bank just announcing a little while ago that four senior managers are out in the wake of the companys unauthorized account scandal. We have details on that still to come this hour. But how about these markets. The dow is over 20,700 and home depot and walmart are powering it higher after reporting better than expected earnings. Walmart is higher than 3 . Walmart 1 . Walmart doesnt give holiday sales before the full earnings are released. Investors didnt have a clue how it went. It turns out its pretty good. Profit beat by a penny. Revenue light with some negative currency drag specifically from the peso. The discounters First Quarter does bracket analysts estimates. The all important u. S. Comp sales were 1. 8 . Thats the best performance in 4 1 2 years. U. S. Ecommerce contributed more to the comp sales with the gross merchandise value. Up 36 over last year. I spoke to walmarts chief Financial Officer brett business on t biggs on the phone. He said we are pro tax reform for anything that will help with jobs and help consumers. He went on to say, we do have concerns that the border adjustment tax has the probability of increasing prices. Walmarts ceo was not in d. C. With eight other retail ceos discussing tax reform but is part of the americans for affordable products commission. Border adjustment tax didnt come up on the call but the Home Improvement retailer tells me it estimates 30 potential exposure to a border adjustment tax should that come into play based on its own imports and the indirect imports of its suppliers. Now the Housing Market continues to lift home depots earnings beat on stronger than expected ri revenue and sales growth. Full year Earnings Guidance is shy of consensus. Home depot dipped by 29 and announced a 15 billion share buy back. Back over to you. Court, what were you just saying about the 30 implied tax . Thats what home depot tax says . Yes. It didnt come up on the call. It wasnt something it didnt come up on the call . It did not. Home depot isnt one of the players with the 30 that is going to see as big of an impact if we see a border adjustment tax. 30 of home depots costs sold will be subject to a border adjustment tax. 30 is a lot lower than Something Like 98 which is what youre going to see from the pure apparel players. I thought you were saying a 30 tax. No. 30 would be subject exposure. The theory behind the border tax in the context of a full tax reform package is that the Corporate Tax lowering thats right. Would offset the impact of the border tax. Thats right. Not taking that into account . No. Theyre just this is where the math gets really tricky. It gets very gray. Its not so black and white because we dont know how all the pieces will fit together if indeed the pieces come at all. All the retailers do want lower Corporate Tax rates but they dont want the border adjustment tax. You may have to have one to get to the other. Thats where it gets tricky. Its hard to figure out the tax rate versus the import. We dont know how that math is going to play out. The shares are rallying. The Retail Sector doing quite well. Lets head down to washington where white House Press Secretary sean spicer just wrapped up his news conference. Eamon javers has a wrapup. Reporter the white house is caught in a giant double pinscher here on this double border adjustment tax. You have retailers who dont like it. On the other hand you have manufacturers who do really like it. On the other hand, on capitol hill you have House Republicans pushing this idea very aggressively and some Senate Republicans who are resisting it. So where is the white house going to come down on all of that . Sean spicer was offered the opportunity to say exactly where the president stands here at this press briefing that just concluded. Heres what he said. I think the president s been very clear that in the next couple of weeks we expect to have a tax plan that gets out there. That is being worked on continuously and so im not going to get in front of that. While the ceos are here im sure beyond some of these things thats an opportunity for them to express what some of those policies are that are both helping them create jobs and grow in the economy and also inhibiting them. Reporter so if you are still scratching your head after hearing that answer from sean spicer, that probably means sean spicer did what he set out to do there and not answer the question and not put them down for any particular answer. Thats something they dont want to get ahead of right now as they figure out where theyre going to land in terms of the math and also in terms of the politics. Sean spicer was also asked about the export import bank, whether the president supports that or not, and he refused to answer that question as well, saying he didnt want to get out ahead of the office of management and budget but he did confirm, kelly, that the budget director is working on a budget. Weve got that going for us. Reporter nailed down that piece. The president does have a state of the union sort of address coming up. Reporter right. Even though technically it wont be considered that. Presumably thats when he could lay all of this out, right . Reporter yeah. Absolutely. Traditionally in advance of an address like that youve seen white houses in past years roll out some of the specific proposals two and three days ahead of time, so be alert towards the end of this week to see if we get some more clarity from the white house and where they stand on both of those big economic ideas. Thanks, eamon. See ya later. Stocks may be higher, but have you seen natural gas today . Last we heard it was down 9 . That is still the case. Jackie deangeles at our commodities desk with details. Thank you, mr. Weather man, or something, right . Yeah. We all enjoyed the weekend certainly here on the east coast. The temperatures were just beautiful, but people certainly were not turning on their heaters and thats what has traders concerned here. Theyre looking out to the ten day forecast and seeing that the temperatures are more mild than they have been at this time of year over the past few winters. So certainly right now it seems the worst of winter is behind us and you can see as december has rolled around we got close to 4. Weve slowly been coming down. Now were closer to 2. 50. A couple of things to think about here as were heading into the summer period. The first is youve got an administration thats pro fracking. That could potentially bring supplies up more and bring these prices down and also theres some chatter about an el nino effect which could give us a little bit of a cooler summer as well. So you could see nat gas prices going under two, if, guys, we have a perfect storm. So to speak. Im fine with the warmer winter weather, jackie. A tougher session for nat gas. All the other oil majors who rushed into that space and the prices are persistently low. Is this what Punxsutawney Phil forecast . We talked about this. He was forecasting six more weeks of winter and certainly what we saw this weekend was not in line with the ground hog, but i follow him closely every year and hes typically wrong so having said that there you are. Lets be optimistic and hope for sunshine. That from our ground hog correspondent jackie deangeles. Thank you. Sure thing. See you later. Lets get to our Closing Bell Exchange this tuesday with the dow all the major averages in record territory. The dow is up 108 points. Michael yoshikami, steven serge gillfoil and sarge 986 llc, that all fits on one Business Card by the way and our own Rick Santelli checks in from the cme. Sarge, when i left two weeks ago there were debates about how over valued the market might be, how expensive it might be. I get back, were still debating the same thing. Whats going on here . You know, its pretty amazing, right . Every time ive sold anything in the last couple of months because it hit my target i sold it prematurely. Weve had confidence throughout the economy through the president s agenda which turned itself into earnings which turned itself now into better macro. So here we are, and that very agenda of the president , that tax reform, now has a major component which threatens the marketplace. The border adjustment, it certainly is something that is perceived as a negative. There are positives, but those positives will be down the road. The Immediate Impact will be higher prices and the retailers arent too happy with that. It could be and the higher dollar. Lets not forget to mention that. Which will hurt earnings across the board. So now along with the president s speech on february 28th, those are our roadblocks. I dont know how much higher we can go in a straight line. My target for the year on the s p is 100 points higher than this. I do think we need to correct before we go there. Michael, a couple of other gauges of the markets, we have deal making, a potential blockbuster with unilever and kraft. We have a big ipo with snap. These are all kinds the competent signs you get during bull markets. No, i dont think theyre that confident. Neither do the deals that youre seeing. Theres not a flood of tech ipos. Theres been a dirth of tech ipos. We have a major head wind in the markets is essentially whats going to happen with tax reform, how impactful it is going to be. You know, jeff cox had an interesting article on cnbc. Com, viewers should check it out, talking about whats goldmans thoughts in terms of the market being way ahead of itself. I really am of the belief the market is ahead of itself. The market will be sloppier and it will impact growth. Rick, what do you think . I mean, i know your primary responsibility is to cover the debt market and the currency markets for us, but even with equities, equities are moving. Everybody else is marking time as we move along here. Whats the market telling you right now . You know, in so many ways, bill, there is only one market. Yes, when you look specifically at one of the sectors, fixed income, our prices are actually higher and the yields a bit lower than we finished last year on tens. When you look at the dollar index its still about 2 3 of a cent away from unchanged. To the down side its still been in the red for the year so the equity markets are the big game in town. When you left i thought wed go higher and youre back i think we go higher. I still say my target is around 21576. Ill tell you i think its going to happen sometime around the first, second week of march just by a count. Can i be wrong . Yes. What i think everybody continues to miss is how theres so much uncertainty here. Doesnt anybody believe that people that are trading stocks domestically and around the globe understand, they see that, too. Theyre not in a darkroom with no screens. I think its a repricing. I think the chaos in washington is a given. Its the baseline, but whats changed this time is there probably will be something done on taxes and something done on regs. Any more than that might not even be priced into the market, at least in my opinion. Michael, if there is the kind of gibb hes talking about, 10 or so, are there some things that are comparable . Yes, there are. Let me comment about what rick said. I agree even though the market as i said perhaps is a little bit ahead of itself, i think its going to get more ahead of itself. Youre seeing, as i said several weeks ago or a couple weeks ago, you see a capitulation of the bears. People are chasing to get in the markets because he they think theyre going higher. There are names that likely will be dipping down. I wouldnt chase the names that will be solely based on whats happening from a tax standpoint. Id be looking at names somewhat out of favor, maybe theres some investment controversy. Disney, espn is a imaginer concern. I think it will be fine. Its not like the overall market has no opportunity, but i completely agree with rick. I think theres a reasonable chance we go higher from here simply because thats the narrative were in. People want to believe. Before we go, sarge, you and i were talking earlier, if anything you would be trading more speculative issues, not the more fundamentalists . My own behavior, im sure other traders are behaving the same way, some might not be. Im either long or i missed the good quality names that have moved a whole ways. Im going to hang on to those positions. I may trade around them with the top half. Im getting more speculative. Ive been buying cheaper names that have a lot of debt, some real, if you want to call it garbage, i dont know if you want to call it garbage. I wont you just called them garbage, yeah. Not true quality, but things that are kind of hit or miss. So ive been going for some of the really cheap energy names, some of the really cheap defense contractor names, some of them i think do have potential but theyre not there yet. Good to see you, guys. Thank you. Thanks for joining us on your thoughts with todays market action. Thank you. So the rally continues. What is this, eight consecutive days for the dow to be up and nine out of the last ten. We havent seen that since july so that includes what weve had since the inauguration. Dow is up 105 points with about 45 minutes left in the day. Snap chat is pitching its upcoming ipo. Well get reactions to that pitch coming up. Also, the Trump Administration may change the way it calculates certain Economic Data, and coming up well talk about whether that gives investors a better picture of the economy or not. Youre watching cnbc first in business worldwide. Oh. Not the smooch method come on. Whats gng on here . You know how ge to fix problems before they. Theylow production, yeah. Ll, no more catchy to buness acronyms. Ore they. Wait, we dont need to smooch . Im sure we can smooch a lution we just need to candice, problem til. Erover the just it go. Hey,orrym late for am buildingsmooh thatelt righ. Whs wrong with you . Hes so trusti. Your daily look at all 30 components of the Dow Jones Industrial average. There are plenty in the red even though were up 106 points. Caterpillar is the leader on the down side on the dow 30. More of them are up higher. Get a check on some of the other movers. Shares of kraft heinz and unilever all falling after kraft withdrew its 143 billion takeover offer for unilever. Unilever says that that offer under valued the company but shares of mondelez are rallying on speculation that it could be a takeover target. This morning on cnbc ceo Irene Rosenfeld addressed that. Theres a lot of speculation out there and we cant spend a lot of our time thinking about it. If you step back a second though, when i split the company i did it because these were two very different portfolios and they actually have shown themselves quite capable of creating great value for their respective shareholders as separate companies. Our company has created over 60 billion of market cap as a result of focusing on snacks and were just going to continue that focus. Zblr wonder if shes gotten a phone call. Talk about a whopper of a deal . Burger kings Parent Restaurant Brands International has acquired the Fried Chicken chain which is called popeyes, louisiana kitchen, a deal for 1. 8 billion or 79 a share. As a result popeyes is up 19 . Restaurant international is up higher, 6. 7 . Big move for them. Executives of snap holding a lunch in new york city to pitch its ipo to investors. Leslie pickers is staking it out. What have you found, leslie . Reporter hey, kelly. Were waiting for some of the key snap executives to exit the mandarin oriental. We saw the cfo drew valero enter. Were waiting for others to come. This comes after a busy day for most of the snap executives, most importantly the 12 30 lunch they had with hundreds of investors. Im told by people close to the company that one of the big focuses of todays lunch was to really hone in this idea of their daily active users and how they are different from that of facebooks. Their average, of course, is 158 million, which is 1 10 of the size of facebooks, but their pitch is to show that the quality of their daily active user is much higher than a normal regular social media company, so they wanted to show that engagement. Another key question of investors was their cost structure. Those questions were answered by drew valero, the cfo. The investors want to know why the spending on Cloud Services were so high. He explained it was wetter to spend for outsourcing than to do those things in house. The executive will stay in new york tomorrow before heading to boston the next day and traveling the rest of the country before pricing next week. Guys. Ive got one. Leslie, first of all, welcome aboard. I was gone while you joined us here. I am i am told miranda kerr, who as we all know is Evan Spiegels fiance, is very upset that facebook has been copying some features of snap chat and i mean, what were talking about is competition for snap chat from some of the big guys in the tech world right now. Did that come up . And could that affect the valuation of the ipo, do you think . Reporter thats the interesting thing. None of the investors in that meeting really wanted to focus on the facebook issue, the f word as one of them put it. This meeting is one where the investors are trying to get investment. Focusing on competition and especially facebook as we know is a big Sticking Point for the ceo was not going to get them allocation. Im told surprisinsurprisingly, not a key focus of todays meetings but its certainly a key focus on investors