Lunch starts right now. Im melissa lee, American Airlines reach an agreement with mechanics and ground workers over salaries under the deal the workers see a double digit pay increase. Tropical storm earl is dumping torrential rains on mexicos coast and expected to land in mexico later tonight. Brazilian soccer great skips the Opening Ceremony due to illness. Pele was expected to light the olympic caldron. Im your busboy for the our oh, no. We have the block buster, jobs report. There you see it at 2181 and change, sending gold in the opposite directions, bonds as well in price selling off as yields rise. Precious metals dropping more than 1 at this hourment lets get more on the market moving higher. Bob . And, tyler, its a broad rally. 31 advancing to declining stocks. Most importantly, all the indexes near new highs. This is the market stapp shot. Historic highs, s p 5 he recollects and nasdaq, approaching highs, not quibbling in the mid cap or small cap, though not in the nasdaq 2,000, the other small cap. Techs been on fire in the last few weeks, not just today, but biotech doing well. The utilities, telecom, this is market reation, and its very healthy. Today, bank stocks, not saying momentum stocks, not yet, but showing signs of responding to the slightly higher Interest Rate scenario seen since this morning. Our old partners noticed when the nonfarm payrolls beats by a large amount, what happens on a day like today is financials, industrials, and materials out perform the market. They nailed it. Essentially, look at sectors. Financials, industrials, and materials outperform the market. Tech stocks up 1 , on fire. We had good momentum in the names. Microsoft up 12 . Highest level since the year 2000 this afternoon. I can go over many stocks up double digits in the tech sector. This is the one to watch right now. Why is this happening . Why today . Brian mentioned were seeing the jobs report, and thats a factor, but on top of that, weve seen decent earnings, fewer downward revisions in the second half, crude stabilizing, and we got more talk of fiscal stimulus out there. Guys, back to you. Bob, thank you very much. Well, it is payroll friday, but dont forget about that other big weekly number. The recountings. They are crossing. They are higher for the sixth week in a row, rising seven last week to a total of 381, down 289 from a year ago, but up six ore seven weeks in a row. Oil down, down already, down 1. 25 , which is 50 cents which is 41. 41 per barrel. Melissa . A big story, bristolmyers having the worst day in years, failed to meet goals in a drug to treat small cell lung cancer. That sends shares of merck higher. They are developing a competing drug to treat the same cancer. Lets bring in aleck covering the health care space, and minutes ago, upgrade e ed merckm an overweight to a hold. What does this mean specifically for merck in terms much future shares as well as market share in this particular space . Its a seismic shift. Merck has front line lung cancer market, the largest market in the immune oncology all to itself for the foreseeable featu future, and they have at least 2030 market share. In terms of sales, we reeaised r forecast from 4 billion to 6. 5 billion by 2020. Higher already, alex, a in terms of price target, what adjustments are you making there . We increased sales from peek sales of 9 billion to 12 billion in 2026, all lung cancer. Once youre established in a setting in lung cancer and front line, these are healthier patients, parties treated more aggressively, and duration of treatment is longer. Finally, a significant dosing advantage, once every three weeks for 30 minutes. Right. This is why we think its all basically straight off dcf, and the eps growth changes the eps Growth Profile and forecast at least 14 or 15 eps growth justifying our pe valuation of 17. A question, alex. Sure. It would just intuitively, it appears the big dropoff in bristols stock suggests that people expected this drug to succeed. What went wrong, and is it game over for this drug . In other words, for those of us who dont know how drug trials work, can they go back and tweak the formulation, subject to another test, or is it all over . This was one of the biggest surprised. They expected it to work. The drugs have shown great clinical profile. The reason we think the trial failed is because it was not enriched enough whereas merck focused on parties that are highly likely to respond, and we have to see the data, but thats why it probably failed. The drug is not dead. Its approved in second and third line cancer, and its worked fantastic, but the major opportunity was in the first line setting, bristol will reevaluate this. They have other trials coming in first line, but they conceded the first line market to merck for the next couple years, and thats going to be enough to alert merck to get established. Alex, thank you. Just upgraded shares the merck. Brian . Bringing in nancy tangler, she got completely out of bristolmyers last year. Merck up 5 in a year, bristol down 3 . A tremendous move by you. What did you see coming to make you make that move . Oh, brian, were valuation driven. We were to a point where bristol was too expensive and forced to trim and then eventually eliminate our holdings. Then you, you know, we faced the down trend in pharmaceutical and biotech stocks, and its not even today yet quite attractive enough for us, but we are looking after this event. Usually, these stocks go from love to hate to disappointment and neglect. We are going to wait for settle valuation to set up for us, even on a technical basis, its on a technical move down although we look at things fundamentally. Well, okay. Know that bristolmyers has the day it had with a massive drop, do you relook at bristol . Not only is the price down, but the valuation metrics we look at are coming down. Is ems now a valuation stock . Yeah, its close. I think what id like to do is just let kind of the people that are going to get out and growth managers usually get out darn quick, so we let them move to the side, and then well step in and start accumulating holdings. We are moving to a significant overweight in the Group Despite the political potential problems with the stocks over the next six months during Campaign Season and election, and the reason for that is, you know, ive lived through the last Clinton Administration as an investor who invested in pharmaceutical stocks, and while they underperformed initially, they dramatically outperformed indexes by 120 , 345 for the S P Health Care index, and 113 for s p 500. A flip side to brians question. At what point does merck get too expensive after the gain seen today . Right. So were looking thats a good question, obviously, were looking at earnings and stock on a relative price to sales ratio basis and relative yield basis. It has spiked up into our ranges. Of course, you expect Earnings Growth to increase as to stay true to market share expanding, but i think its getting close to being in a position where we have to start trimming and selling out of the stock to stick to our discipline. All right, nancy, we got to leave it there, but a great call by you for you and your clientings. Have a great weekend, thank you. Thank you. Lets get back to the big employment report crushing, crushing expectations is the economy added 255,000 jobs. Steve leisman, the crusher, here with the top take aways. Hes the professor. Now the crusher . You know, one of the big take aways from this blowout jobs report is its hard to find anyone saying anything bad about it. No political tweets out there about it. Showing 255,000 in job growth, showing the market in all important dynamics to improve. A little checklist here, job growth broad based. Wages up. 3 . More finding jobs, why the Unemployment Rate was up changed, hours worked up, and previous months revised higher. Heres where the jobs were, what i mean by based job growth. Leisure and hospitality up 4, 0 45,000. Government up 38,000. One of the biggest two months in a e row we had of government job growth. Manufacturing construction, helping out a bit, temporary help, a sign of things to come, people come on temporary then made permanent, retail up 15,000. Whether its Strong Enough to hike as soon as september is the question. Dear fed, wake up and smell the job growth. But take a look at how the market reacted so far. Heres the percentage chance by meeting month of a fed rate hike, just 36 in december, 17 in december, 40 in february. Not much going on there, not until theres a 50 move until we add up the december where the market is looking for that next hike. Over in oxford, they say, unless other incoming information changes, the fomc will likely nudge the Fund Rate Target at the december meeting. Ubs, one or two strong labor Market Reports are not enough to pull forward the december hike that we expect. Three factors hold the fed at bay. First, renewed decline in oil prices pushes down inflation. Measured gdp is weak, fed needs collarly between the two numbers showing the real economy, and, third, bank of england announced more stimulus, cut rates, europe, japan, negative, fed is weary of getting too far away from its colleagues, the central bank. August reports are important ahead of the september meet k. Expect the gains continue . Anything underpining anything seasonally to make the august report just as robust . Could be a funny month for data and jobs. You had a big seasonal adjustment, but not a bigger one than normal in the month of july. Some people talk about that, doesnt make sense to me, but jackson hole communique is key. Youll be there in a couple weeks. Will be. Steve, stay with us. Bill rogers, chief economist, now a a professor at rutgers. Remember carnac . Go forward. You follow me. He did this. Put a question here on his head, and would open up the envelope, and he would say, oh, and the answer is oh, im remote today, yeah. The answer is not now, maybe later. Whats the question, bill . Will the fed raise rates in september . You got it right. What do you think . I dont think they will, but i do think that youll start to hear that wonderful phrase, weve got to love and possibly hate a bit, and everythings data dependent. You know, they definitely will change their language in the statement if we get another, you know, strong report like we did today. So you take this strong report, you which is, for the month of july, you compare it with the weak print on gdp for the previous three months through june, what do you make of the u. S. Economy . Strong . Weak . Middling . Good . Bad . Yeah, i think were its as my former boss labor secretary used to say, its steady as you go economy. Were growing at a pace that is now in terms of the job Growth Numbers over the last three to four months, you know, it exceeds the number of new jobs we need to help to push unemployment down where people are coming in and getting jobs, and we saw in this report, the year over increases in wages that exceeded, you know, the growth Consumer Price index, and theres one area that remains, you know, my kind of focus on is that u6, Unemployment Rate that includes not only those actively searching, but those who want a job or those who work parttime only for economic reasons. You know, thats still, you know, just a tad below 10 , its not returned to its, you know, level prior to beginning of the recovery. It did pop up. It did by a tenth this time around, bill. I think one of the questions yes a lots of questions folks have is, can the strong growth continue . Theres a narrative out there. Look at the past year in job growth, we have a weakening in the spring, say, march and april, especially may. We had a really lame report. We have a chart on that. What it shows is that this looks very much like a bounceback from the two months, and so the best bet is that we return to some kind of trend in the coming months of around 150,000. Bill, whats your take on that . I think thats about right. Hopefully we get closer to 200,000, but i think that, you know, may was definitely a low. You know, you reported on some of the Key Industries that turned around this month and actually over the last two months now. It was leisure and the hospitality, and then, also, within that professional Business Service sector, temp employment. Those were the two that rebounded in the last two, three months that were the, to me, when i looked at the data, were the major contributors to the may lull. Brian, we have a chart here, if youre a 25yearold, a Fouryear College degree, youre full employment, 2. 5 , and High School Dropouts have a better time, their rate from 8. 5 to 6 prepondera. 5 . What do you see as the hold up right now to a stronger job market in the United States, what should we do . Im big on human priority expenditures, and these are expendtures the Public Sector makes and private sector can make, not only on human capital, but education and training, but also on social capital. Where youre investing in communities, and so this goes beyond what was said this morning. He greed to wanting a pack taj that would focus on physical infrastructure, but we have to focus on human infrastructure. Theres been a great deal of deferred, what i call Deferred Investment in the two areas, and those would set us up in terms of providing opportunities today, but also its an investment in the future and improve productivity numbers seen. Do you have a statement, steve . No. Youre done. I didnt know. If oil and gas turns around, its a better number. That was the only sector, again, down about a couple hundred thousand jobs, losing 6,000, so if we get Mining Mining oil and gas stabilized not even stabilized, but improve the number. They are cranking up rigs again. Steve, thank you very much, bill rodgers, we appreciate you being with us. Still ahead, a call to haction, why apple pays you to hack their products. Whats driving netflix higher right now . First, jobs, the economy, and race for the white house. Mark is up next when power lunch persons. Welcome back to power lunch, stellar jobs report driving stocks higher. 2 255,000 jobs added last month, more than expected, but how much a tail wind does this offer the president ial candidates . Thoughts from morning, president and ceo of the National Urban league. Hi, mark. Hi, ty, how are you . Your colleague told us he thinks this is no occasion for a a victory lap. First quarter gdp revised down to. 8 , and president obama will go down as the only president since 49 not to have one year with above 3 growth. Your reaction. Well, the president and on his watch inherited the worst economy since roosevelt with millions and millions of job losses, and on his watch , its converted to a trend of over 200,000 jobs a month with one or two exceptions in the last several years. And i think thats important to upsz. Its not a time for a victory lap because unemployment is high in many communities. The Labor Force Participation rate is not where it needs to be. Overall growth rate is not where wed like it to be, and question is, how staepble is this, so while i believe firmly that president obama maeds a substantial contribution to taking what he had and improving it substantially, theres tremendous amount of work to be done. Im here in baltimore, and theres still, in many neighborhoods, high unemployment. What do you want to see done in either administration to address pockets of unemployment that you point out rightly are so intractably high . Minorities, young minorities, particularly. Important question, ty. These times call for an investment approach, and that should include fiscal spending, public spending, as well as how to realign the incentive structure so that jobs find their way to the inner cities, to the urban communities, and not abroad. I believe that theres a lot of work to do to rebuild water systems, sewer systems, transportation systems. Its always been a part of america to build our infrastructure for the future. I think thats job one for the next president of the United States. To give us an infrastructure based jobs initiative. Secondly, i still believe strongly that a 15 National Minimum wage high to inflation has the effect of stimulating wages across the board. We do have a better situation when it comes to employment in the country, but wages a stagnant and americans are not seeing a pay raise in the sense of wages increasing visavis inflation since 2000. Thats important work for the next president and next congress. Okay. Thank you. Good as always to see you. Thanks, always. Americas Company Looking for hackers, how to cash in when we return. Welcome back to power lunch, shares of Weight Watchers down more than 5 in todays trade. Second quarter revenue fell short of analysts estimates. The big issue is membership. The company add the members in north america, but was hurt by lower numbers in europe. The stock has lost more than half of its value so far this year, and, melissa, as you know, this is a company that brought in the help of media mogul Oprah Winfrey in october of 2015 to accelerate the turn around, but, perhaps, we have not seen the results just yet. Thank you. House Hunters International olympics edition. See the digs for the usa basketball team. Setting sail for rio when power lunch returns. Theres a lot of places you never want to see 7. 95. [ beep ] but youll be glad to see it here. Fidelity where smarter investors will always be. If only the signs were as obvious when you trade. Fidelitys active trader pro can help you find smarter entry and exit points and can help protect your potential profits. Fidelity where smarter investors will always be. Narrator kubo est place come on, this way. E. Narrator . Is in the forest. Kubo wow. Narrator so grab your loved ones monkey dont even. Narrator and explore a world of possibilities. Kubo its beautiful. Narrator visit discovertheforest. Org to find the closest forest or park to you. Hello, everybody, heres your cnbc news update for this hour. The u. N. s