Tim has an interesting explanation for that. First, on a day that saw the dow break 18,000 for the First Time Since july, the results were seeing from netflix and ibm and morgan stanley, justifying the fierce rally we have seen in stocks. Steve grasso . I dont know if its justifying it. I think yellen, the fact that the job is pitting everyone into equities. I dont think shes done a great job for the overall fed. But i guess if you gauge her success on equities, shes done an amazing job. I think you get tired seeing whether utilities outperform. The sell the news event with opec, it happened too quick. The selloff in about 12 minutes. It wont realize positioning. It had to get long again. Dan, i said to you before, earnings are going to be lame at best and the dow is going to top 18,000 and close above it for the First Time Since july, and the beginning of midapril. You probably would have told me you were crazy. I think steves wrong, and i dont think youre wrong too often, steve, but yellen, whether shes talked specifically about it, we know the dollar, thats down 4 in the last few months alone. When you talk about the Dow Jones Industrial average, popping 18,000 for the first time in july, youre talking about large u. S. Multinationals. But year over year now, if you look at the dixie, its actually down 3 , 4 from yearago levels. You had really poor expectations coming into this quarter, and then but do you think earnings can be better . They will be. Youre lapping pretty difficult comparisons. If the dollar were to stay in these lower bands, that its been in the last 18 months, then you have it set up for stocks, that the multinationals will continue to rally. The headwinds to the last nine months, financials are the place, lets bring it back to what actually is, i think, the most absurdly oversold group coming into these earnings numbers where weve had terrible earnings. We know that the last quarter was bad. We also know the dynamics based in Capital Markets and headwinds and drying up liquidity. But if you look at the charts and say the markets can break through the old highs, financials have to do it. Frankly, those charts over the last two weeks, not just through friday, not just last week, but today and even going into the numbers, told you, and i think tell you that financials are going to lead you to the next level. Jamie dimon certainly thinks and hopes so. The day that he bought his own stock marked in many cases the bottom for that sector specifically, and in some ways the market as well. February 11th, that announcement, the jamie dimon announcement, the uae announcement around 2 30 talking about potential production cuts. Later you had a deutsche bank, i think some sort of bond offering that gave them clearance for a while. Those were the three things that got the market off and running. Today, is it justified . Probably the answer is yes. Because they have not theyve been lousy but they havent been disastrous. Given the climate, given the environment, theres no place for people to go if theyre looking for yield and growth. I dont think its the right move, by the way, but thats whats going on. The banks are falling apart from a Balance Sheet perspective. People are saying theyre going out of business. The u. S. Is on a relative basis, especially around here, there werent many people saying it was out of hand. It was europe and asia. If you really focus on what some of us consider is a rolling credit crisis, into our financial crisis back in 0708, those are the weak links. I look at goldman sachs, you know, its still down from its 52week highs. You talk about the jamie dimon bottom, 63 to 53, fantastic. Im saying that the financials look great. What im saying is if youre a market player and trying to understand, because youre going to keep talking about this 2100, 2120 thats been bucked up the last 18 months and youre right, but again, people the 400 day nice sell. But i think not to step on you, but i think the points are well taken. I think xlu, utilities were up 13 yeartodate, xle up 5 . And the financials etf, which is down 3 . I agree with tim. If the market goes higher, its got to be the xlf. I dont think youll see any rotation in there. What happened after hours today is sort of a perfect example of how this market has managed to rally through disappointing earnings. Ibm, bellwether stock, its lower after hours. Netflix has been a fan favorite of so many people, represents growth in the market. That stock is under pressure as well. Is that a reason to go into tomorrow morning and sell the rally or a reason to just look away and say, you know what, it is what it is, the market momentum is heading higher and i need to be there . You know, the things that have been performing over the last few weeks, despite what were saying in a financial space, are the things that i think will continue to work. And thats resource stocks, thats emerging markets, thats places that i think were so overbeaten. I think in ibms case, this is a stock nobody expected anything out of. Netflix, i think the expectations are absurdly high. I look at oil today, how people priced that in the last six to nine months, and a big disappointment, and oil is up on the day ibm is lumped into that yield. I think people are searching for the yield because its so difficult to find in this marketplace, that its not as if its been so beaten up as far as expectations, as much as why people are buying its yield. Sure, but you could make a credible argument, though, you correct me if im wrong, ibm is afterhours stocks lows of the session, you could feel negative how you will go into the take tomorrow. Yet this earnings season has proven that bad numbers dont really matter. Dont matter. And i would take a little bit of only braj with the fact that i dont think they have nearly the gravitas they had five years ago. Its a wildly held stock. I agree. Ibm beat by almost 11 on the eps side and just and realigned their guidance. Thats what it comes down to. The reason to own ibm five years ago is because they had vision. They dont have the same clarity they had back then, which i think is why you sell it right here. Well, earnings have pushed the dow above 18,000 for the First Time Since the summer. But our next guest says the results bear a striking resemblance to 2008. Carter is behind that call. Breaking it down at the smart board. Hey, carter. It is all about earnings. Thats ultimately whats going to make us make the new highs or not. Lets try to figure it out. This is a longterm chart. The s p versus earnings. We know at certain points, obviously markets get real expensive. If you put the lines on the last three tops, in 2000 we had multiples in the 30 plus pe range. In 07, we were at 17 times. Here we are at 18. But the point is, though, that we are clearly above. And in each instance you start to roll. Thats whats basically happened here in both lines. So the question is, are we going to make a new high, or does that matter. A few things. These are known stats. Its always good to look at things over and over. Q4 estimates q1, excuse me, are a disaster. If this plays out it will be the first time weve got four consecutive declining earnings going back as far as the end of 08, early 09. The top line is equally dismal. Five consecutive quarters of revenue declines. If you put in the context of the longterm chart, the issue is, is this a time to be bullish or to think the end of cycle. So a few more things, and then im going to quit. Here is the chart of the s p. What we know is there are two reference points left. This is connecting the series of lower highs. Since weve peaked in may. And then theres the second line which is the alltime high. It would take us 1. 9 to make a new high, 2134. Lets say that happens. Are we really going to explode or is it going to go back and fill, or back away . What we do know is a little bit more to get to a new high. Valuation, we are making new valuation highs, or getting more expensive at 19 times earnings. Higher than we were in 07 and higher than we were in may, almost a year ago, or early last week. Carter, thanks. I think when you look at what carter is pointing out as far as valuation of pe, hes pointing out do you sell at 19 times, which is roughly where we are right now. Basically buy at 17 times, which brings us down to an 1800 handle. These are big volatile moves. Weve been caught in such a tight trading range that i think it will be explosive. Unfortunately one way or another. What are you selling and buy . You tell me, overlay tenyear or overlay relative earnings at those other times. This is a totally new ball game. So stocks should be expensive here. Theyre going to trade expensive here. I know that earnings are poor. I know this is highly flagged. People can continue to find ways on the way up to say, this is the top. Its going to turn here. Weve been hearing this for weeks and months. The reality is that the market is going to find places well, you know, its going to find places to go up. Even if the absolute market doesnt go screaming higher. I think thats very fair. Think about it. It goes back to the clar and back to rates. If you think back to prior bubbles that got inflated, where things got overdone, its because of the situation where, like steve said to start off the show, people were funneled in equities. There are very few places to invest. This is a conversation we started to have on the day. Look at carters chart and look back at the prior levels weve been in the last 14, 15 months or whatever, the path of least resistance no longer looks higher. You think about the shock to the down side and we havent made any meaningful progress. I think the risk reward sets up poorly for an upside breakout that goes parabolic, versus the setup we saw the past january, february, last august, and october of 2008. Sentiment is really bad. I agree. Finding one person that says the market is going to be highs thats the problem. I dont think anybody at this desk that the market is going parabolically through this level, no. To say were going parabolically, or taking the other side of the move in the last two months, i say no. The argument for stocks has been spoton, which is why they should be expensive. I also agree with this. Its been support for quite some time, a couple years now. Vix at 13. At least if nothing else, makes you forces you to do something. Up next, while everyones talking about the problems with espn, disney keeps pumping out Box Office Hit after Box Office Hit. Netflix and ibm falling after hours. Netflix getting hit, as you see there. That stock is down nearly 11 . Were going to get instant reaction on the netflix call from both sun trust and the cofounder of that company, mitch lowe. Later, could be no deal in do it is ha signal the end of opec as we know it. Big implications for energy stocks. More fast after this. Mary buys a little lamb. One of millions of orders on this companys servers. Accessible by thousands of suppliers and employees globally. But with Cyber Threats on the rise, marys data could be under attack. With the help of the at t network, a network that senses and mitigates Cyber Threats, their Critical Data is safer than ever. Giving them the agility to be open secure. Because no one knows like at t. Frank abagnale. Convicted felon and con man. That was a long time ago. You know, they made a movie about it. You were shown to be quite skilled at fraud. Times change. Now i help catch the bad guys. Me too. I help banks detect fraud by applying cognitive analytics to public financial records and social media. So if somebody said, catch me if you can. . We can. Lets do a sequel. It could be a buddy movie. I would like to have a buddy. Biotech stock tanking after hours. Seema mody has more back at hq. This is a big mover after hours. A revenue warning from alumina. Its projecting approximately 12 Revenue Growth for 2016. The company citing weakness in europe. The ceo said given the disappointing outlook in europe, weve made Management Changes in the region, and plan to implement a program of actions to achieve our goal of delivering the robust growth. We believe the market can support. Down 19 after hours. Ibb down as well. Seema, thank you so much. Thats a problem. 41 times forward earnings and go from 16 growth down to 12 , the market will whack you. If you want to play the technical game, since the middle of 2015, a series of lower lows and lower highs were about to make one of the new lower lows. Through 140 this thing gets dicey. There will be an opportunity to buy this stock. But i dont think its 140. I think its closer to the 125s. Which given the guidance, the evaluation, you might see. Disney clocking in as the best performing stock in the dow, after Pivotal Research upgraded from a buy to hold today. Getting a boost from the Box Office Success of the jungle book movie, second biggest april debut ever, bringing in more than 103 million. All of this begging the question, are investors discounting disneys Movie Division and putting too much emphasis on espn . Thats what cramer certainly thinks, said as much this morning. I think thats the case. They are the king of content. Everyone lost track of that. But we are in a bounce level. Its not going to be an easy road for them right now. Im actually long the name. We had a recent low of 86. I dont think it makes it to the 120 level. I think its probably got another 5 to 8 to the upside from here. Market focusing too much on espn, too much on succession with iger and not enough on the studio which has, as we said, been churning out i think in august when this whole thing started he didnt expect this tidal wave of negativity that followed, right . Thats what started it rolling. I think its equally important now. And to jims point and your point, it does trade at a premium valuation. I think they are getting the benefit of the doubt from the other businesses. Ill be interested to see what they say. A seller . Honestly, if youve enjoyed the ride like steve has, i think you absolutely sell right now. I think the branded content strategy makes the most sense. The irony is the content is what gives them the premium multiple, not the cable business. So actually, if anything, this is the reason you should be buying disney, not selling it on espn. I think again, this feeds through to the consumer products, it feeds through to theme parks. Its their entire model built off of this. This is why you own disney. The cash cow thats been the cable and espn business will continue. And it will trade relative to every other guy in that sector. Maybe even with a small premium. The rest of that, youve got to buy. It should trade at a premium in the sector, no doubt about it. The point about the success, its uncertainty. But if they were to land somebody, i dont know, sandbergs name has been thrown around, i think thats something the investors would be excited about. You were talking about merchandising. Look at has brouk today, thats where were going with that today. Star wars. And then, obviously, pixar is huge for them. All the princess stuff. Star wars was like 19 times. Ive seen it three times in the theater and twice on dvd. Its both matel and hasbro. You had utopia, and all these things at the theater. Im saying, you had its going to the Toy Companies. Board games here . The merchandising and parks, now the star wars coming out at the end of the year. A lot more to go. All im saying is both Toy Companies have been really benefiting from people that are its not just christmastime anymore. All our kids are spoiled. Easy, buddy. Dont talk about my kids. Its true. Takedown. Come on. All right. I think mattel, this is part of a massive dividend story. I agree with steve, i think what steve was saying when he was trying to insult guys kids, not mine, was that youre not seeing a recession in toy buying around the world. This continues to be theres no pullback guy has kids as well. Hes allowed to spoil them, greg. He gives them back. Exciting time for your family. Finish the thought. You lost me. Mattel is not necessarily all about the branded content or an extension into the toy business, its a turnaround story with management. Its a dividend play, a china play. The fact that toys, period, dont encounter the same cyclical risks as pcs. Netflix and ibm falling hard after hours. Well talk to both ceos on Conference Calls. Im scott walker, youre watching fast money. Heres what else is coming up on fast. Thats what traders are saying now that theres no deal out of doha. Oil investors are missing a crucial point. Hell tell us what it is. Plus, stocks are surging. But one notable name is missing out. Heres a hint. Well tell you whats wrong with apple, and if now is the time to get in, when fast money returns. Welcome back to fast money. Shares of ibm moving lower. The Conference Call well under way. Lets get to josh lipton out on the west coast with the details. Josh . Reporter well, scott, we know ibm is staying fast as it can to the higher value areas, cloud, analytics, mobile, and security. Heres what Martin Schroeder had to say about the areas on cnbc earlier. When the first quarter, we had again Good Progress in transforming our business. You can see in our data, for instance, in growing the strategic imperatives, double digit again. We see that the investments were making are certainly paying off. Theyre driving growth above market rates. Now, schroeder also saying the imperatives generated revenue 20 billion over the past 12 months. He also broke out the many partnerships ibm is forging to accelerate the move into the cloud. Take a listen to what he said about that to analysts. This quarter, we announced the number of partnerships with Companies Including vmware to advance the development of next gen cloud applications to enterprises. Weve brought swift to the cloud, enabling mobile developers to build endtoend mobile apps. All of ibms Relevant Software is now in the ibm cloud. Now, to schroeders point, the cloud revenue clocked in at 11 billion. The problem is, ibms core business is under pressure. You saw it throughout the results. Down about 2 . Global Business Services revenue down about 2 . Technology services in the Cloud Platform down about 2 . Scott, back to you. Josh lipton, thanks so much. Ive god to hand it to tony, first and foremost, before the results came out, sa