Transcripts For CNBC Power Lunch 20130926 : vimarsana.com

CNBC Power Lunch September 26, 2013

Allamerica survey. Meantime lets check in with sue down at the nyse. Hey, sue. Hey, ty. Two companies under siege today. Jc penney and blackberry. Can these companies reverse their fortunes . Both were trading in Single Digits today. Jc penney rebounding just a bit. But at a 13year low, nonetheless. While blackberry way below the 9 a share that fairfax says its willing to buy it for. Right now jc penney is up 5. 25 in terms of percentage points. We have Courtney Reagan on jc penney and jon fortt in san jose with the latest on blackberry. Courtney, you first. Thats right,ist been a tumultuous week as the stock price fluctuates to sharply positive on a mix of father and news. Cnbc has learned that jc penney ceo met with investors in new york city yesterday telling them jc penney doesnt see conditions this year where it would need to raise liquidity. They adding well see how we do in the Fourth Quarter. Reports that jc penney was considering raising up to 1 billion did in funding had pushed shares it a 13year low over the past two day. And some of the heaviest Trading Volume in the stocks history. Though ullman comments suggest a liquidity injection isnt tally imminent. Jc penney tell cnbc it is paying its vendors tame, and vendors are still supportive of the turn tl around progress. Shares are moving higher on these reassurances from the company and comment from mr. Ullman. This morning jc penney issued a statement presumably to quell concerns about its financial position in the market saying in part its encouraged by improvement in conversion. Online sales are trending up double digits year over year. And perhaps most importantly, it still anticipates it will experience positive trends coming out of the Third Quarter and throughout the Fourth Quarter of 2013. Some investors are disappointed, sue, with jc penney that they didnt offer numbers and any update on cash. Remember, liquidity is a concern. Absolutely, courtney. Thank you very much. As for blackberry, tmobile saying it will stop stocking blackberry hand sets in its stores. Jon fortt is in san jose. We knew blackberry has its exiting the consumer market. Is this tmobile news the result of that . Well, it might be related to the latest on blackberry, as you mentioned, is more bad news. A manufacturing partner mentioning last night they might back away from the company, and tmobiles no longer going it carry blackberry inventory in its stores though youll be able to order onloin. A tmobile executive saying the only people interested in blackberry are business professional. Tmobile is the smallest of the major carrier. The biggest players, at t and verizon have both told had he theyre still carrying blackberry inventory in stores. Shares today trading as you mentioned well below 8 bucks i hair. Fairfax Financial Holdings is offering 9 bucks a share to take the company private. All this comes after the smartphone maker on friday warned that its net operating loss would be far steeper than wall street expected between 950 and 995 million as consumers turn up their noses at the companys new blackberry 10 phone. The company is also poised to cut 40 ofity staff, around 4500 workers. So wheres the company go from here . Some suppose it might be sold for farther. One likely scenario, the riskier phone hardware business might go away while the software and Services Live on. Well see. Tyler . Better to tell you face it face. All right, jon, thank you very much. One company which was down in the dumps and has rebounded is facebook. The stock breaking through 50 a share for the first time ever. Its up more than 100 in the past three months. Julia boorstin follows the company for us. What are they doing right . Recently theres been a slew of positive analyst upgrades. And the Facebook Stock has really been soaring on a momentum upswing. Share are up about 2 are today, up a total of 90 since facebooks july 24th earnings report. Now, the stock is up now 32 over its ipo price, driven largely recently by data on just how well face bock ad wrk. Yesterday doug anmith, 53 price target noting that facebooks share of Internet Usage is about four times all competing services combined. That lus instagram and twitter. He also notes that facebook increased its share of internet minutes 33 this august from a year ago. Now, facebooks momentum isnt just on wall street but also on madison avenue. Sources at facebook and ad agency telling me theres been a huge perception shift of the value of facebook ads. Now, face bock points to a study it did with tmobile on its latest rebranding campaign, claiming it influenced the atigs of naearly 800,000 new customer. Though my sources stress that its the data that drives decisions, it cant hurt facebook in its negotiations that its stock has been on fire. Tyler, youve got to think theres some sort of psychological effect. Exactly, that the two have to be sort of symbiotic. A 100 gain in three months. Its amazing. Thank you. Good to have you here. Breaking news in the bond market. Lets check with mr. Santelli with those sevenyear notes. Sir . Sevenyear notes, 29 billion, the yield at auction, moments ago, 2. 058, the wen issued where it was trading in yield before the auction was completed, 205 offered at 204. 50. So it tailed close to a full base point, 0. 8,. 09. The bid to cover the auction average. But like many auction of late, theyve been less aggressive. So take that into consideration. C minus no matter how you slice this auction, it was definitely the spongiest of the three. Sue, back to you. Rick, thank you very much. Well, after five straight down days on the dow and the s p 500, stocks trying to eke out a few gains. As we wrap up the Third Quarter, where do we go in q4 . Right now the dow is up 59. The s p is up 5. And the nasdaq is up 27. The biggest percentage mover on the day. Kenny pulcari is with me, director of oneill securities and an analyst here on the floor. And down in washington, president of farr, miller washington, also a cnbc contributor. Good it see you both, gentlemen. Kenny, were going to go into q4. Some of the fundamental look very good, but we still have looming out there the fed and various other thing. Right. Like the debt limit. Right, high school whats clearly keeping us kind of in check where were stuck in this purgatory, in the sure which way to go. Its evident you can feel it in the lack of volume, the lack of really interest because theres no reason for people to take the market higher at the moment. Right. But nor are they so sure they want to start selling it off yet either because theyre waiting on all this data. Yeah, michael, does that kind of gel with what youre looking for . I know youre a longerterm investor, obviously. Are you still finding value in the market . Were finding value, but its harder to find, sue, things this wed kind of like to buy are fairly expensive now. Its hard to find a cheap stock that get us really excited. I think that the, you know, skunk at theic thick right now are all these guys sitting behind me under that big white dome, we were kind of got a little bit of a boost, of course, out of the fed news that theyre going to stay there, spig if the open throwing cash at this thing. Risk trades started to come back on. These guys are killing it. Does that create volatility which might create opportunity for you, or do you sit it out until we get a resolution from washington . I mean, we really hope that its going to create some opportunity. We havent had a significant market pullback in almost two years at this point. I would welcome one so that we could find some buying opportunities. Right now you kind of have to just sit tight and keep your powder dry. Yeah, for a shorterterm trader, kenny, how would you play this . You have to be cautious. I think the market issing if to test lower before higher. Weve already seen it, theyre already starting to talk about octaper. Hows the market going to react . So therefore i think the path of least resistance at the moment is to at least test the 50day moving average, and then wohl see how the washington story develops it figure out if its going to be worse or less. You know, michael, before i let you go, kate kelly is going to be up next talking about jpmorgan. And i know you hold jpmorgan, but youve trimmed back a little bit, correct . We did trim back our position in jpmorgan. We still have a couple hundred thousand plus shares. But we think that, you know, while a lot of the regulatory noise and risk might be already priced in, jpmorgan has seen a pretty good gain from basically a writedown of their assets bringing forward against their reserves to add to earnings. They cant do that much right now. So we think a lot of the gains that some of the bank stock including jpmorgan probably behind us with a lot of litigation and regulatory risk. Take a little bit off the table. Take some profits and still be cautious. We think caution still makes a lot of sense even when this risk trade comes back on. Longer term, own solid balance sheets. Got to leave it there. Guys, thank you very much. Good to see you again, michael, as always. Thank you, sue. Kenny, thank you very much. To Kayla Tausche for a quick market flash. Sue, were watching shares of lockheed company. The company increasing its returns to shareholders. Shareholders that hold the stock as of december 2nd will get a higher dividend by about 16 . The company now going to pay out a dividend of 1. 33 a share. Its also increasing its share boyback program by 3 billion. You can see shareholders like that. The stock is up just about 1 , spiking intraday. Tyler and sue . Kayla, thank you very much. Jpmorgan chief jamie dimon met with eric holder in washington this morning. He left after the meeting after meeting for two hours. The speculation is that a settlement could be near with the Embattled Company between them and regulators at the doj. The stock right now up 23 cents, 51. 93. Kate kelly with the details. Mr. Dimon, mr. Holder, mr. Holder had comment, actually. No, thats right, tyler. And the fact that dimon met withholder face to face really suggests strongly that a settle am deal would be near and that the two of them were discussing relatively final term. In this press Conference Held on an unrelate matter just after the meeting with dimon, the attorney general had some strong words, though, for jpmorgan and its fellow banks, several also under investigation for alleged misconduct with the connection of sales with mortgagebacked security. Holding Companies Accountable for manipulating Financial Markets is a priority for the justice department, holder said, and we can expect it see more announcements of cases related to that in the coming weeks and months. As of yesterday, jpmorgan and justice were discussing a possible settlement of roughly 11 billion from what im told, a chunk of which would go to consumer relief. But a key question remains whether jpmorgan would admit or deny wrongdoing and how many government probe could be resolved all at once. In addition it the justice department, the new York Attorney general and the federal Housing Finance agency are also in lawsuits with them. And resolving as many of those as possible in one fell swoop would be key for j pchl morgan. Whether they can come to an agreement soon would really help a lot, i think, to restore investor confidence. It has been an expensive six months for jpmorgan with respect to a lot of different settlements. This one would be the granddaddy of all of them, right . It would. 11 billion would be the largest fine imposed by the doj for anything if it got there. It is stratospheric numbers. It wasnt long ago that it was a big regulatory settlement. Now weve catapulted into something completely different. Is the Sticking Point here, if there is a Sticking Point, the question of whether theyll admit to wrongdoing or accept responsibility . I think that is a Sticking Point. Anytime you admit to wrong tl doing which, of course, is something regulator are really pushing for now including the s. E. C. And mary jo white, you usher in the possibility of private lawsuits because after all, youve admitted wrongdoing so you should be held accountable in multiple ways. Thats always an issue. The other thing is this thing i mentioned about settling multiple matter at once. There were even stories earlier this week suggesting that maybe some totally unrelated investigative matters would be bundled in including this probe into chinese hiring practices. Hairing of chinese officials sons and taur. But im told thats very unlikely. The mortgage settlement is likely to be just that. Quarantined. In term of the chain knees hiring practices, in terms of other matters related to energy, thats for another day. Thanks. Great to see you. Sue . The treasury has launched the third phase of its plan to sell its stake in general motor. Few details were offered, but the government currently has about a 7. 3 ownership in the automaker, thats about 101 million shares. It took a 61 stake back in 2009 as part of that 49. 5 billion bailout. A number of Japanese Company pleading guilty and paying more than 740 million in fines for their role in fixing auto parts sold the price of those auto parts sold to u. S. Carmakers. Scott cohn is here with the details. Hi, sue. This is a huge case that official say directly affects what you and i pay for a car and what it costs automakers to build them. Nine japanese parts makers and two executive admit they illegally fixed prices on 5 billion worth of parts sold to manufacturer includes gm, ford, chrysler, honda, nissan, toyota and more. Alternator, fuel injection systems, windshield wipers, 30 different parts that are in every car you buy. The suppliers admit theyve been Holding Meetings in some cases for more than a decade to illegally manipulate prices and rip off the automakers. Company executives met face to face in the United States and in japan and talked on the phone to reach collusive agreement and it allocate the supply of auto parts sold it the United States car companies. Threequarters of a billion dollars in fine. As we said, the biggest, 195 million goes to hitachi motive which sells ignitions and alternators as does mitsubishi electric. Mitsuba will pay 135 million. None of the companies has responded to our request for a comment. This has been a longrunning investigation for the justice departments antitrust television involving the auto parts industry. Todays charges bring the number of companies implicated to 20. The number of executives charged to 21. 1. 6 billion in fines. And by the way, transparent pricing would help u. S. Auto parts makers and a inform them including johnson controls, borgwarner, federal mogul up big on the day. Tyler, back to you. Scott, thank you very much. So whats in a name . It seem like a lot when it comes to health care in america. Isnt that right, Steve Liesman . Yeah, thats right. What is in a name . If you call it obamacare, what do american think . What happens if you call it the Affordable Care act . Youre going to want to stick around and hear these answers when power lunch comes right back. vo you are a business pro. Maestro of project management. Baron of the buildout. You need a permit. To be this awesome. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above, and still pay the midsize price. aaron purrrfect. vo meeeow, business pro. Meeeow. Go national. Go like a pro. Unh [ male announcer ] you can choose to blend in. Or you can choose to blend out. The allnew 2014 lexus is. Its your move. Welcome back to power lunch. Im bertha coombs. Weve got a developing story with just five days until Obamacare Exchanges open for business, a partial onemonth delay on the Small Business portals. Then line marketplace will open on time, but the white house now telling nbc News Companies using the socalled shop marketplace for businesses with fewer than 25 employees will not be able to actually buy coverage on those portal until november 1st. We dont know why that is, and its in the a major issue for the businesses. Theyll still be able to look through plan, and they dont actually need to buy insurance until december nin order to hav coverage start january 1st. And its certainly in the as big a deal in the delay to the larger mandate to 2015, but there are lingering concerns that technical glitches could force a delay of the exchanges that are set to open on tuesday for the much larger individual markets. So far nothing on that front. The Administration Says individual enrollment will in the be impacted by this partial Small Business delay in the ability to boy. Back to you, tyler p. Stl boy, a lot of things have to go right starting october 1st. Speaking of health care, so what is in a name . When it come to health care in america, it seems a lot. Steve liesman here with his exclusive survey. Fascinating stuff. Stloo we put this survey together every quarter. I was trying to figure out how to ask it. Obamacare or the Affordable Care act . Why not put the question to the american people. So what we did, folk, in this survey, 800 american around the country, we asked half what you think of obamacare, the other half when they think of the Affordable Care act. Lets start here. What you see is this is the percentage. About 20 or so positive on the Affordable Care act. 25 or 30 negative dont even know what the Affordable Care act is. Now, lets show you what people think of obamacare. You see positives go up above 25 here. And then quite a bit more negative here. We talked about why that is, and unsure. They just know they dont like it when you call it obamacare. Wait till you see who doesnt like it. Lets go down to the next thing which is men and women. This is men on obamacare. You can see very

© 2025 Vimarsana