overnight, the nikkei was actually up by 11.3%. but this comes on the heels of a 5% drop the day before. people are watching that closely to figure out how nervous they should be based on the oil prices in japan. oil price res down by 76 cents, to 92.85. the yield on the ten-year is 2.068%. it is the -- there's a page one story that focuses on what has happened in the month of may as bond price ves plummeted. the yield has moved up by about a half a percentage point over that period of time. obviously, still incredibly low by historic standards, but people are starting to debate about why the yield is moving so much higher. is it because the fed messed up, there's a concern about what is going on or is it the sense of economy is starting improving and you're starting to see what should happen as rates start to pick up. >> it's the big story in the journal, reportedly. reportedly it's in the journal. >> our papers are late. >> no, i saw it -- >> have you tried to restepn line in the makeup room? there's no connectivity. >> and you have to be a member of the journal to read online, don't you? >> yes,o sfp. >> you pay money, you subscribe? >> i pay money. i am supporting the -- >> you're supporting rupert murdoch. which goes against everything you stand for. >> that's not true. >> yes, it is. >> i was singing -- >> yeah, what was your song? >> i was singing we're up all night to get lucky, we're up all night to get lucky. >> i thought you were making that up. >> no. this is the biggest song on -- this is the number one album of the week, we're up all night till the sun -- girls are up all night for good fun, but we're up all night to get lucky. i don't know. are they gambling? who is pharrell? >> i know exactly what it means, it just never happened to me. but what is -- i must have been unlucky. i was up all night to get unlucky. there, that's what happened to me after i was up all night. >> pharrell is the producer. >> pharrell is? >> yes. >> he sings with dap punk. >> i don't know this song. >> we're going to play it eventually 37. >> we're going to get it after the break. but i don't know about this. >> we'll see who is going to get lucky this morning. >> papers are here. >> this market this week, i don't know. you know what i mean? >> i know. it has a weird feel. the big question is, there's a change in sentiment. we've been watching japan. >> volatility down, up, we need to look at that chart because it was up yesterday after reboundsing from that horrible day before. >> there's been much more volatility through the course of the day. >> i don't know, andrew. i know you didn't think last week the taper tepper tipper tapper none of that mattered. i don't know. i feel different. >> you were telling me we're on a straight line up. >> until last week when you told me that it meant nothing, that the fed didn't change anything. and i said the second derivative of the derivative did change things. >> it's the last trading day of the month. this month has been really crazy. >> with europe, remember that one? we got that date in history where you said, no, no, no, and it all came straight down in yields since then. last week on thursday, it was with the moment. i think that was a moment on wednesday when they let us know that eventually they were just starting to close the thicket as our people spell it here. but i think it's positive long-term. i think the market finally goes up. >> rallies. but in the short-term, it's going on be -- >> well, i think initially in watching what happened in japan, too, is that -- the fed has been moving all of these markets around the world. but your boys on thursday night told you. now you forgot that. remember thursday night you were at the hedge fund thing and they said it's different. now you forgot that and you're arguing the other side. >> because you gave him grief when he brought that up, too. >> now, it wasn't grief about that. then i started questioning myself on the same. >> we have a couple of economic reports coming today that we should note. personal income and spending coming in at 8:30 eastern time. then in the 9:00 a.m. hour, chicago pmi and consumer sentiment will be here. for expectations, we should say personal income is seen rising by 0.1% while spend sg forecast to decline by the same amount. the other thing that's going on right now, becky was talking about crude and is crude being 93 right now. opec minister res meeting in vienna today. that's where we find steve sedgwick who has more for us. good morning, steve. >> a very good day to you, as well. on the surface, you might see a 30 million barrels a day headline. yesterday for the production process and you'll see it again tomorrow. that doesn't tell anywhere near the true story of intrigue and paranoia that is going around the halls of vienna as these 12 ministers meet. they control around a third of 30 million barrels a total consumption of 90 million barrels. they produce just over that, actually. as we know and we discussed previously, a little bit of overcapacity there, overproduction, as well. but there are grave concerns that we're seeing a change in dynamics globally. demand is coming up from china. also falling demand for exported oil going into the united states because of the shale revolution. now you ask, six minutes what their problem is with shale and they say no problem. but you get seven and sometimes they might let you in on the secret they're worried about. this is the nigerian oil minister who exports to the u.s. are suffering because of shale. let's listen in. >> i don't think that in the very immediate future on the short-term the shale oil or shale gas will overtly affect opec countries or opec's production and their exports at all. but it is of grave concern for us, even though we do respect the integrity of the u.s., of course, to be self-sustainable in terms of oil and gas. however, we are, of course, concerned in the medium term. >> so there is grave concern coming out of some parts of opec. others are just saying, look, it's not a problem. we're fine. the oil has taken all the oil we produce. i was talking to the saudi minister earlier on and it was very much don't worry, be happy. >> what about the competition from u.s. shale oil? i mean, i know that at the current levels, the world will take every barrel of oil that is offered. but are you worried about this at the tail end of 2013 and 2014? >> let me give you advice. take out the words worry, take out the words concern and the world will be in good shape. >> isn't that lovely? take out the worry, take out the concern and we'll be all better. the only problem for me is that i've seen what's happened to other commodities, would a host of industrial metals that have had extreme volatility. oil hasn't had that. you have to wonder just how long we're going to see these stable oil prices. let's not forget, we saw record oil prices on an annual basis last year at $111 a barrel for brent crude. ten years earlier than that in 2002, it was only 25 bucks per barrel. this year, we're averaging $102 with w at this. so if we see slight changes in the supply dynamic and indeed the sign of demand dynamic, as well, there is a concern we will see the fall in the oil price. elsewhere, great intrigue between the iranians, iraqis and saudis who all want their man to be the next secretary general of opec. that's going to get rolled over, but it does expose the sectarianism that is flooding through the middle east because the saudis want their own man and iraqis and iranians have their own issues, as well. plus the fact if they are going to have to take some oil off the table at some stage, people are going to have to accept quotas. so there's a whole host of issues and stop blocks beneath the service which make this meeting for me very interesting, indeed. guys. >> okay, steve, got your vienna sweater on. it's raining, it looks like. is it cold? >> pretty nasty, don't you think? i live in london and it's legendary for its wet, miserable conditions. apparently in advance of me coming over here, it's been the wettest week they've seen in may in many, many years. >> "sharp dressed man" we're playing for you, steve. i like it. i'd prefer it if it had a little zipper, if it was an actual sorkin sweater. but it looks good. >> look at him modeling. >> yeah, he is. look at the shirt. it has striped and the white collar and everything else. he has it going on, but he is in europe. he's on the continent so he has to. i want to talk now about sony, although i want you to google something. just google -- just go to google because there's a line of petri dishes. >> i saw that already. >> you know what those marks are. those are disgusting bacterial plaques. and anything that you -- if you're not in a sterile room -- >> oh, uh. you spent a lot of time doing this. >> i did. >> oh, that's nasty. like to get perfectly clean agar plates, you need to be in a room with no germs whatsoever. and if anything is around, those grow. >> we did a science project like this. >> these are actually dishes from the tests done on andrew after he came back from vietnam. didn't you? you had to go to the doctor. is that all cleared up? >> it was an ear thing. >> if you've ever done this -- >> an ear thing. >> look, this could be from your computer. >> no, i know. let's talk sony. >> or not. >> what happened? >> you talked too long. >> i'll find it on my script. >> we have other news that we'll bring you, but rate knew, we're going to the latest news out of europe. louisa bojesen is standing by in london. louisa, good morning to you. >> hi, hi. good morning. joe, another thing for you to do if you're on google, go and look at wa a dust mite looks like. >> i'll do that. i'll do that and show becky. dust mite and hit images. >> yeah. that's what you're sleeping on every single night. >> let me see. >> nice. >> i know. it's quite entertaining. let me show you what europe's markets are doing while you're googling the dust mites. we're lower. stoxx 600 lower by 1.9%. reversing some of the gains that we saw coming through yesterday on the close. our main european markets managing to take a leg up. and looking at the main markets, we're down somewhere in the region of 1.9%. i want to draw your attention to comments made by the italian central bank governor and the ecb policy member. he spoke around an hour and a half ago and he's saying that the ecb stands ready to intervene again on rates. they are considering that to maintain credit conditions consistent with their monetary policy stance. that according to one of my guests earlier was saying that means the nonstandard measures. he talked about monetary reforms. he's urging a common euro budget, suggest ago joint debt issuance on a trial basis. that might be interpreted to mean some type of a euro area bond, as well. last but not least, you talked about the italian banks, too. they are at risk of being in difficulty. in particular, one would seem this means the medium size to the smaller sized banks. the likes of monte paschi still being quite weak. those comments coming through earlier. we saw it coming just a little lower on the back of those comments. indeed we continue to see a little bit of selling in the euro/dollar, down somewhere in the region of 0.5% against the greenback. owner that, in general, we are looking towards broadly flattish markets over the course of the month. i think it's worth pointing out you were talking about some of the commodities. there was steve a bit earlier on. we've seen gold rallying over the last week, higher somewhere in the region of some 2.5%, despite the fact that we've seen a lot of gold weakness. i think it's interesting to see what is happening in gold in the last month and whether we're going to see this flip-flopping. we've seen a lot of equity readjustments coming through for the month of may. a lot of equity weakness. excuse me, a lot of equity strength in general, weakness over the last week, but strength in general and a lot of selling taking place in the bond marketses. is that going to reverse? last but not least, did you know that 69% of germans, they tip when they travel. that's more than americans. only 57% of americans tip when they're on vacation. i was quite surprised. i thought it would have been vice versa. >> louisa, thank you very much and thanks for making me go search google for bed bugs. now i'm totally freaked out. >> that's not new. >> no. but if you search, you can find pictures of mattresses that are infested. it was really disgusting. let's get back to the markets because it's more calming. the s&p is on track for its seventh straight month of gains. joining us now to talk about run away rallies and buying samp peat sess jeff stout chief investment strategist at raymond james. jeff, this is fascinating. this whole idea of a buying sta stampede. you coineded this one? >> back in 1997. there's been a few that have extended for 25 to 30 sessions, but it's been rare to have one go for more than 30 sessions. we're actually at a session, 104 as the dow joins industrial average has not had three consecutive down days since this buying stampede began. >> so what's different this time around? >> i think the economy is improving. i think the liquidity is vast throughout the world. i think that the portfolio manager is not just here, but over in europe. i can't find a structured account in europe that is even 20% weighted in u.s. equities when they're benchmarked. the msci is about 44% weighted in u.s. equities. so i have been telling, in fact, on your show for the past number of months that i think the s&p trades to 1700 before the end of the quarter. and then i think sometime in july and august, we become susceptible to the first deal pullback. >> and a decent pullback would be, what, more than 5%? >> yeah. i think somewhere between 10% and 12%. but i think that's for buying. people are so focused on why stocks should not be trading where they are rather than focused on why stocks should be trading where they are. >> does it make any difference to you if the fed decides to start tapering? because that's been the huge question over about the last week or so. >> first of all, i don't think the fed is going to taper. but i think if they did, i think the equity markets would assume that they're tapering because things are getting better. there have been three times since 1980 where the delta or the rate of change on the ten-year treasury yields has gone up 20% or more. and each one of those occasions, the equity stock markets have actually rallied. and we've had that just happen in the ten-year treasury yield. it's up about 20%. >> the other thing you say we should be watching are lumber prices. forget about copper. lumber is maybe more important particularly when you're talking about the home improvement front. >> well, i've had a lot of questions recently if the economy is strong and housing is one of the hallmarks of the stronger economic data, then why is lumber doing what it's doing? and if you look historically, lumber prices have tended to weaken in the spring. there was a phenomenon where there was a shortage of railcars to transport it. actually. that's been self-correcting. you've had some of the timber mills and plants come back online. so we would expect lumber to be volatile over the next couple of quarters, but as the housing market strengthens and volumes pick up even better than they're doing right now, we think lumber prices firm again in the first half of next year. >> jeff, this is a soothing message, a calming message, but is there anything you would pay attention to that you would say maybe i need to reassess this for a little bit? >> i think if the price of crude oil for some off reason jumped and jumped strongly, i would be worried about that. or if you get a huge policymaker out of washington, d.c. but quite frankly, i don't see either one of those things happening. >> so even if there is a pullback, if we lose 5% down to 10%, you would tell people hang in there, that it's a great buying opportunity and maybe step up to the plate again. >> this. >> that's what i would do. i would look for the markets to turn higher, maybe put in some downside hedges at that point. i do think we're vulnerable once you get out into mid-july through mid-august. >> so we go down -- >> actually, i think we're going to trade over 1700 into the end of the quarter and probably the first or second week of july. and then i think we become vulnerable, joe. >> what does the end of the year look like? >> i think the end of the year stocks will be higher than where they are right now because i think the know will be better. >> so we could end at 1700. you're not looking for gains before the end of the year been we run up there, consolidate it and maybe run back up there. >> that's what i think. >> okay. not a bad way to think. >> we'll see. but it does imply -- >> better than the alternative. >> but it sounds like paulson. you are saying most of the gains have been made for the year, jeff, or maybe getting another 40 or 50 s&p points. >> yeah. and then you get a hit. and if you trade it right, you're going to get a chance to buy that hit and trade back up to, i don't know, 1750 by the end of the year. >> 1750 by the end of the year, okay. that's another hundred points. that would be pretty good. >> but you have to trade this properly. >> yeah, you do. you have to be nimble. >> he's saying you could hang out and just wait. and you'll end up where you are now. anyway, okay. thank you. >> jeff, thank you. coming up, defense secretary chuck hagel is warning of cyber threats. we've got the details, coming up next. but first, take a look at this. there is a new spelling bee champion, winning the prize with this word. >> k-n-a-i-d-e-l. knaidel. >> wow. >> this is the first year, we should note, that a xeertized vocabulary test helped determine the finalist. >> then he missed his last name. i can't get that. i don't know. >> wow. way to go, way to go. >> as we head to a break, we have a bit of trivia this morning courtesy of a tweeter. can you guess which major econ policy was a -- policymaker was a local spelling bee champion? win the dillon county championship? >> that should give it away. i'm on expert on softball. and tea parties. i'll have more awkward conversations than i'm equipped for, because i'm raising two girls on my own. i'll worry about the economy more than a few times before they're grown. but it's for them, so i've found a way. who matters most to you says the most about you. at massmutual we're owned by our policyowners, and they matter most to us. ready to plan for your future? we'll help you get there. as we twoent break, we asked you, could you guess which major ee conpolicymaker was a spelling bee champion. this young man, ben bernanke. there's the picture from it. i can't say i'm surprised. top speller. mark that. in other headlines this morning, defense secretary chuck hagel says cyber threats pose a quiet, siddus danger to the united states and other nations. calling for rules of the road to giet behavior. hagel is on his way to a meeting in singapore where he plan toes address cyber security in a speech tomorrow. the topic is likely to come up in a brief meeting with chinese delegates on the sidelines of that conference. joe. let's get the national weather forecast from the weather channel's jen carfagno. jen, wow, severe storms again. >> again. >> but fought as bad yesterday. we were all worried. we didn't see the worst case scenario, i guess, did we? >> no. and it's rare to get that worst case scenario. ef-5 tornados like in moore, oklahoma, account for about 1%. you might get one or two of those a year. but we see a lot of tornados here in this country every year. yesterday, reports of tornados. you go back over the past three days, 800 reports of severe