Sea. No, not a giant squid or Chris Hemsworths biceps, theres a gigantic cargo ship in operation. Look at that thing. It literally is a monster ship. I know, and we are going it talk about how this could change the shipping business forever. Tyler is out all week. You just saw mandy doing the halftime report. A lot of swaps going on today. Stocks are sinking on the final trading week of the year. Major averages down a half a percent overall but its not all bad this year. If you own these stocks, treat your family to a nice dinner soon because you have made some money. Netflix up 135 , amazon up 115 , activision nearly doubling this year and nvidia up more than 60 . Oil and Gas Companies have been leading the declines. Chesapeake down 80 for the year. Consol and southwest energy down 75 and a list too long to mention of many more stocks down 30 , 40 or even 50 in the group so far this year. In the meantime, the financial and the Telecom Sectors are kind of the january and peter bradys of the market. The middle children of returns. Telecom down 1 yeartodate. Financials down 3 . The question is, can these sort of boring laggard groups this year become your Winning Investments next year . Jennifer fritsche covers telecom for wells fargo, Brennan Hawkins covers financials for ubs. The fed rate hike heard around the world hasnt proven to be that big an event nor tfor the financial names. Are there any you feel will outperform next year in part because of higher sflats. What id say is we prefer given the fed rate hike and the tailwinds you hit on briefly, we would prefer the bullish bracket groups and then the trust groups. Even if we see a flattening yield curve, they can still benefit. You get an increasing earnings lift on the back even if you see potential multiple compression across the market. The group ought to do well at least on an outperformance basis if not an on an absolute basis. Talk to us about citigroup, the most international of that bunch. We have seen emerging markets get absolutely walloped, brennan because of the commodity collapse. Is there a sign citigroup can turn it around even if commodities dont turn around. Citigroup trades at the biggest discount, a full turn Business Count on an earnings basis. So citigroup clearly the stock reflects at least a component of the risk to the emerging market exposure as you hit on, and its really more than just commodities. Its all about strengthening dollar with the worry that if youve got stronger dollar, its going to draw cash away from some of those emerging market economies and put pressure macro economically on some of those economies and, therefore, the Banking Industry within. Its a question of how much the dollar is going to continue to strengthen here for citigroup. Citigroup is a stock i like. I feel like at current prices at least the component of risks are reflected and the dollar has strengthened quite a lot in anticipation of these first rate hikes. Shes going to move slow. Shes going to move cautiously, and so we might not get a whole ton of follow through, maybe another hike or two, perhaps at most three or what most investors expect. Im with them. Brennan, i want to really hone in on that point because even in todays session we saw twoyear yield hit a 5 1 2 year high and the 10year yield come down. Were seeing a flattening of the yield curve since the fed had its meeting and hiked rates. What if the yield curve doesnt steepen, does that change the outlook . Most loans are pegged to the front end, particularly when you think about commercial loans that are often libor based. You also have credit card which is prime plus, right . So when you think about the money center banks, which tend to be more consumer lenders, most of the loans, the mortgages they keep on the Balance Sheet arent the 30year fixed theyre selling off. Rather, theyre going to be a. R. M. S where they float after a certain amount of time and then theyre going to be credit cards which are pegged to the prime rate. So really the long end of the curve is not as important to the money center as some might think. Of course, a flattening yield curve, they call it a flattener. Sorry. Have to leave it there. Thanks so much. On that note talking about twoyear note. Waef twoyear note auction. Lets get to Rick Santelli with the results of that. Melissa lee, this could be the strangest auction dynamics results i have ever seen. Okay. 26 billion twoyear note yields. Last twoyear note auction of the year. The yield 1. 056. So a couple whiskers under 1. 06 which happened to have been pretty tight. That was pretty good in terms of where the one issue was trading but here is where it gets strange. First of all, thats the highest yield at auction since 09. Bid to cover 3. 29. This one was 2. 8. That was the weakest bid to cover. How many dollars are chasing every dollars worth of securities available since the summer of 09. 37. 5 on indirects. Thats the softest since christmas of 14. The only really good metric here was the directs, and they were off the charts, 27. 1, the best since december of 2013. A lot of extremes, probably because theres extremely vacant areas in a lot of the trading desks but d plus, dog plus is the grade for first of 90 billion in supply. Tomorrow 5 year followed by 7s. Melissa lee back to you. Dog plus for the 2year auction. I have to ask you about the yield curve because we saw the 2year yield jump as i mentioned to the banking analyst and the 10year yield come down. Whats the outlook down there for what happens with the yield curve going into year end . Well, pretty much many are looking for ongoing flattening because the short end will be nailed to the notion of the fed raising rates and the long end so soft growth, whether its the 2 handle in our gdp or think china here. But anything can happen and sometimes the contagion of raising rates does catch up to the longer end, it just doesnt seem to be occurring on this tightening cycle, but it is only one tightening thus far. Well have to continue to monitor when we get into the next several meetings. Rick, thank you. Rick santelli in chicago. Lets take a closer look at tell com. Jennifer fritsche is a Senior Analyst at wells fargo. Great to have you with us. You have a few picks going into 2016. I want to start off with sprint. It seems tmobile is upping the ante in terms of the promotional activity and thats causing others to up the ante including sprint. When tmobile rolled out free video streaming sprint came out and rolled out an aggressive half price deal here. So, jennifer, what do you like about sprint and are they going to be sort of forced to continue to discount into 2016 . So sprint is kind of the big empty airplane. Remember, they have the most spectrum of any of the four National Carriers and as all of us continue to use more data, thats extremely compelling because the rest of the carriers with less spectrum will be fighting with one arm behind their back. They need to get customers to them and thats why these promotions i think are value add. Remember, these are temporary but sprint from a network standpoint is ready to take them in and show with their greater depth of spectrum they can offer more for their dollar. Do you get a read based on christmas weekend sales of phones as to whether or not sprint is gaining from the holidays . Our checks do show that sprint has seen nice momentum. Remember, their churn was really at an alltime low in the in the most recently reported quarter. We expect that to continue but we also expect gross a. D. Ddds w is new customer additions coming to them to see a nice lift. Its coming from the larger carriers, at t and verizon. One thing we love here, jennif jennifer, are new names and im not familiar with zayo corporation. You say theyre a great dark fiber player. I presume youre not talking about cereal. Who is zayo and why do you like them . We like with the wireless pressures which melissa just alluded to, wire line is actually becoming a lot more exciting. These are the pipe layers, the Highway Builders to and from the cloud. Names like zayo is the dark fiber. As you have companies and headlines like apple building their own cdn, more edge out strategy, google needed more bandwidth, this is all positive for the highway owners and names in that space would include zayo, also level three which is our top pick. We also even like the Highway Builders names like dicom, ticker dy. Jennifer fritsche of wells fargo, thank you very much. Sprint and zayo, have a happy new year. Well see you soon. You, too. Thanks. Speaking of the highways of the sea, the era of the mega ship has officially begun. The largest container ship ever to come to america arriving at the port of los angeles. This literally is a huge story. Morgan brennan joining us now with more. Morgan . Reporter hey, brian. Thats right. Were going to call this the dawn of a new era for shipping as this mammoth ship called at the port of los angeles this past weekend. So the ship is called the b benjamin franklin. Its the biggest to ever arrive at a u. S. Port. It has capacity for 18,000 containers, that is about double the average ship that calls at l. A. , and just to put its dimensions in perspective, it is longer than the Empire State Building is tall. Wider than a football field and when its fully stacked, it stands about 20 stories high. So the ship is making a test run. Its coming from ashia to l. A. Late they are week it travels north to oakland. It was not loaded to full capacity, only 70 utilized in part because u. S. Ports are just not ready for these super sized ships yet. Even l. A. Which after a decade of planning is the closest. So one maritime consultant recently warned if we see more of these super size vessels before the ports are actually ready and specifically the flood of containers they bring, that could overwhelm the west coast ports and make the east coast ports look even more attractive. Still, the expectation is we will see more and more of these super sized vessels coming on the transpacific trade routes in coming years because they are very fuel efficient and they dramatically cut down the overhead costs for cmacgm and other container shipping lines. And a few Amazing Things about this ship, it has the thrust power of 11 747s but to me the most incredible thing, the crew is only 27 people to run that huge thing. Its only 27 people. Its all computers. Reporter it is pretty incredible. Right now cmacgm has not announced any more plans to bring the ship back and forth to the west coast, but the expectation is were going to see more and more of these massive ships coming online and coming into places like l. A. The fact that the crew is that small with that many containers is really quite something. And they do have an indoor swimming pool, i might add. Morgan brennan, thank you very much. So this year was a tough year for most bond investors. What about next year . One fivestar fund manager will tell us where he is finding some relatively safe yield. By the way, youre watching cnbc. We are first in business worldwide. Shows that people really like how with directv you could put tvs anywhere and not see cable wires and boxes in every room. Why cant we get people to just say cables, schmables . Hold on, hold on, i really like what youre doing there because if we just add schma in front of something, it just doesnt seem like a big deal. Boxes, schmoxes. There you go. Cold sore, cold schmore. Yes scotch, schmotch what . Ill take some of that schmotch alright. Schmank you vo get rid of cable and upgrade to directv. Call 1800directv. Welcome back to plunk. Im melissa lee. Chipotle shares are lower. A restaurant near Boston College has reopened several weeks after 136 patrons fell ill with the neurovir neurovirus. Valeant pharmaceuticals taking a big hit. Michael pearson has been hospitalized and has take an medical leave because of a severe case of pneumonia. His illness comes amid government scrutiny into drug pricing and pressure from investors on how the Company Plans to grow profits. We have more on this story in the next hour. Lets get to seema mody for a market flash. A bright spot on our radar. Sign Signet Jewellers up 1. 5 . The company was the focus of an article in barrons over the weekend suggesting shares are expected to rise and the recent selloff and credit concerns are largely overblown. For the year, shares though down about 8 . Brian . Seema, thank you. Turning now to the broader bond market. How are investors balancing their positions as we head into next year . Thoughts now from jeff, manager of the fivestar 3. 8 billion thornburg limited income fund. Joining us from beautiful santa fe, new mexico, this afternoon. Thank you for joining us on power lunch. I guess the delicate balance, the basis of your job going into next year is going to be where can my client get a relatively decent yield but relatively safe yield because we have seen many bonds, especially the higher yielding junk bonds, have severe problems this year. You know, thats absolutely correct. Our job every day is looking at the markets. Its global generalist. The team here trying to find interesting sources of yield that wont introduce a lot of volatility into the portfolio. One of the ways we do that is dividing the word into a three Balance Sheet approach. Government Balance Sheets that started off the crisis in a pretty poor situation and have since gotten worse. Corporate Balance Sheets that started off the crisis in a relatively safe place but have leveraged up and the consumer Balance Sheet which arguably may have been the reason for the crisis but have since delevered. Its the consumer Balance Sheet where were finding the most interesting sources of yield. Like what . Across a lot of spectrums. When i say the consumer Balance Sheet that can be on the assetbacked side, auto loans securitizations, credit card securitizations, fairly highly rating securities short term. Even in the safer parts of fixed income where spreads have moved out quite a bit, those look kind of interesting to us. But as well as on the corporate side of the consumer Balance Sheet side as well. Auto loan story, jeff, is interesting because we have highlighted on this program many times about all this sub prime concern around auto loans and how auto loan defaults could spike. It doesnt sound like youre that worried about that. It depends. You really have to divide the world up. Theres a pretty significant difference between your average person with a relatively hifgh fico buying a reasonably priced car versus that of the subprime world. We have played in the Higher Quality auto story as well as the subprime story. But in todays market where spreads in both sectors have widened pretty significantly, were finding more value in the high quality, not the subprime space at the moment. Well leave you with one final question because people say this is really the housing problem redux on a smaller level. And the housing issue, as our viewers know s that crap loans were bundled in with good loans and then sort of packaged together and sold. Is there any indication that these crap for lack of a better term, auto loans are being bundled with the good stuff or can you really identify the good stuff as the good stuff . I think it depends on which name youre speaking towards. There are certainly programs out there that do pubundle a wide spectrum of loans out and pile them into one broader securitization. Then you brought up the story of subprime auto loans and generally speaking in the market they tend to be two different buckets, if you will, where the Higher Quality securitizations go into a unique bucket versus the subprime borrowers who are pushed into a discrete bucket as well. All right, jeff. We appreciate it. Thank you very much. Have a happy new year. Well see you in 2016, buddy. Thank you. Sounds great. Thank you. The collapse of oil certainly one of, if not the biggest business stories of this year. Prices were down 30 . Saudi arabia posting a record budget deficit because of those declines and that could have an impact on how the government deals with its citizens. Whats ahead for Oil Next Year . We have your 2016 playbook. Thats next. As 2015 draws to a close, cnbc is breaking out the 2016 playbook looking at ways you can make money in the coming year, and this hour were focusing on oil. Here is jackie deangelis. Oil prices saw massive volatility in 2015 hitting lows not seen since the financial crisis. Global producers continue to pump more crude choosing to maintain market share despite a low price environment. Here are three predictions in energy for 2016. Prices will bottom in the first half of the year. The biggest global oil producers, opec, russia, and the United States, have not and will not significantly drop production in the first half of the year. This will cause crude to bounce around the 30 range, maybe even the 20s before profit pressures force more meaningful production cuts that will eventually stabilize prices. Iranian oil will come online. Though the markets have already priced in this expected bump in reserves, when it actually happens, it could cause more pricing pressure initially until Global Supply is curtailed by other producers. Buy big oil. Share prices of Big Oil Companies have suffered this year as crude prices dropped. They could see more pain in 2016 but names like exxon and chevron that pay dividends and are diversified will weather the storm and see upside when prices stabilize. All right. Take a look at this video. Iraqi forces declaring a big victory as they reclaim the city of ramadi from isis. Is this the beginning of the end for the selfproclaimed Islamic State. Michael reuben with is the enterprise institute. How meaningful if at all is this victory over isis . This is extremely meaningful for iraqs Prime Minister. He pulled a rabbit out of the hat because his back really has been against the wall. He had this oil crisis making it hard to pay salaries. He lost a lot of territor