Care about, theyre destroying. You cant have it both ways. A city wide curfew starts tonight at 10 00 p. M. Baltimore city schools have been cancelled and several area businesses are telling their employees to stay home. We will have a live report from baltimore later this hour. Behave businesswe have business stories to tell you about. Well be getting pfizer murick,s by tomurick murick,s by Bristol Myers and well be hearing from twitter, go pro, kraft food and others. A twoday meeting an announcement due out tomorrow afternoon. The index in april Consumer Confidence numbers well get those this morning. In global news greeces Prime Minister is confident about an early deal after sidelining the outspoken finance minister that infuriated partners but if the talks fail the Prime Minister would have to resort to a referendum. In stocks to watch today, apple is going to be sharply higher in after hours trading after erngsarnings stopped revenue. A lot of that had to do with china. The company is also expanding its Capital Return Program by 70 billion to 200 billion. This comes from boosting its dividend 11 and upping the Stock Buy Back Program to 140 billion. Bps quarterly profits beat estimates. Earnings from its refining business as with so many others help to offset the drop in crude. Ceo bob dudley is promising that the dividend is safe at bp and hondas reresults were short of guidance. Quality related costs, weaker sales in the United States as well as japan and the auto maker is now forecasting flat profits for the year. Muricks diabetes drug meeting the main goal of a long awaited heart safety study. The news remove ace cloud of uncertainty around the companys biggest product and barrick gold results were hurt by Lower Oil Prices and sales of gold. The Company Announced it started a process to sell a stake in a copper mine in chile. Lets get a check on the markets this morning. Weve been watching the futures. At this point the futures are mixed. Dow futures down by 2 points below fair value. S p off by close to 2 points. Nasdaq off by four points. In europe in the early trading at this point it looks like there are some weaker numbers for the mayor indices there. The cac in france down by 1 . Ftse off by. 8 . In asia overnight the nikkei ended up by about. 4 but shanghai composite down. Wti down to 56. 76 and in the bond market this morning if you take a look at the ten year note this yield alt this point still below 2 at 1. 923 . Lets take a look at currency markets. The dollar is weaker across the board this morning. Dollar euro at 10909 and the dollar yen at 11897. Gold prices right now down by about 2. 1,201 an hour. Lets get back to the corporate story of the morning. Apples blockbuster quarter. Lets dig deeper. More than 61 million iphones were sold during the quarter but ipads came in lighter than what analysts expected. Thats the trend there. Its now swelled to 194 billion. Eugene covers apple. He joins us this morning. Gene, i mean theres nothing what possibly could even worry you about this company . I mean nothing for the next year. I guess in the back half of the year it worries investors. The good news is the investors have been expecting these comps and any investor that bought the stock over the past few months has v known the stock is up 23 . So from a fundamental standpoint theyre absolutely killing it as you mention. Its amazing. Do you worry should we worry at all about the ipads . Im not trying to look for clouds but its like we could talk about this company as the greatest its the greatest thing that happened since i dont know what. Well in the context of how the iphone is doing i dont think we should worry about the ipad. They call it 10 , 8 of revenue right now. Its becoming a smaller part. If the iphone wasnt doing as well as it was that would be some concern and obviously the good news is here is this opportunity of greater margin with the iphone so thats the black eye is the ipad but in the context of the iphone its not that big of a deal. Do you like them giving back all this money . If i could channel larry fink i would imagine he might want them to invest some of the money back into their company. Its a little bit of a distinction. Yeah, theyre basically giving away their access. Theyre taking debt out against International Cash so this is the right strategy. They still need to do Something Bigger in terms of mna. The beats deal is the biggest thing they have done and that doesnt have as much substance on the longterm to investors would like to take big herb push whether its automotive or another sector but as it stands right now this Capital Distribution is the right thing and at the right size too. If its the greatest company in the world how do you find another company to buy where youre not diluting the greatness of your own franchise. Thats their problem. And its not they dont need to invest 7 20like 20 billion. The fact that got me is the increase in revenue in the quarter totalled 49 billion which is the annual revenue of nike. I have one quick stat to emphasize is that every 1 market share gain they had 2 in the last quarter. Every 1 market share adds 17 million iphones or 5 to the revenue. Can they Grow Market Share . If they can, this story can continue. They talked obviously about many more people switching over to their phones. Also upgradeing and that was in terms of the size difference. Now its already bigger and were going to go into i assume not the spring but the fall where i assume they will do an s version of all of these things. It will be the same except for a little faster. How many more phones can they sell and what happens a year from now . Well you have to believe this can continue. The s version will probably be remote charging. Wireless charging. Wireless charging . Not like i can just walk around and its going to charge in the air . No you just dont have to plug the cord in. You have to put the phone down on a mat kind of a thing. But the core real question here is what are we going to do about the big comps like we mentioned . Its going to get more difficult next year but investors are prepared for that. The good news is in 2016 well Start Talking about iphone 7. Is there anyway the watch could be a negative . It doesnt have to be that big of a deal incrementally but is there anyway it could turn into a negative for the stock price . It could. One of the big things from last nights call was that the profitability on the watch at least for their guidance for june was less than investors had hoped. We believe thats a near term ramp. But thats one piece, if that doesnt play out, this becomes the ipad mini. But the margins overall for the company were quite a bit better than most analysts were expecting. Yes, they were better. It did have a negative impact. Do they care if people start buying laptops with keyboards . Its just a name. One is a laptop with a key pad. If they saw a bunch of them does it matter whether its an ipad or laptop . I might buy one. What matters is the revenue. Yeah. You get the keyboard. Its the typing issue again. Yeah. All right. Although what is that an operating system where suri knows what im saying. I only hit one letter and i look and the word is up there that im hitting. I sent something out on twitter yesterday or sunday that was totally messed up because the iphone changed it. Changed it from tony romo to ton romo. Do you see the words up there where it says im going and two will be there if you say going and then the its unpredictable. Maybe unpredictable. Before we go what does this mean to google . In terms of the android ios fight . I think theyre going to lose share for the next few quarters. It wont be huge share but theyre not going to be gaining shares so this is advantage apple at least for the next six to nine months. Thank you for joining us this morning. Thank you. Im just averaging 2 im averaging 2 letters per word now. She comes up with ridiculous stuff. Say something clearly and i look at where it is and thats where you say someone. Telephone game. But other times she gets the word. They have got it. It hears you and understands the words. Do you get to know the person . I dont think there is a person. Ill have less performance if i could actually talk to someone i know. You saw what happened to that her. Totally fell in love with the operating system. Are you in love with suri. You got a guy that falls in love with his operating system. Who made that movie . Who green lit that thing. And yet you know the story. Youve seen it. Have you ever asked the phone questions like hold on suri do you love me . Now its not work. Thats how much suri really loves me. There is a what is it . If you dont have something nice to say dont say anything at all. It will say crazy things back to you. Robot chicken suri falls in love with him and he wont date her anymore and she says take a right here and he drives off a bridge. Anyway, the feds twoday policy meeting could set the tone for todays trading ahead of that earnings and market caution dominated yesterdays session even though am was up and now dow comeponent so the dow should have been up. Here now is ed campbell and reading the stuff that the preinterview notes a lot of the themes are things we have been talking about. Thats sharp slow down in the economy. Yet you think we go back to a run rate of 3 for the rest of the year. Europe might be a better place if youre going to invest for equities and the weak economy pushed the fed back to fall at the earliest. Thats a consensus view of a lot of things. Yeah so when i was last here in january mentioned that i thought europe could be the big outperformer here and that played out. Weve got the dax up 20 plus percent and that view was driven on europe rebounding from recessiontype conditions last year. Good valuations. Policy tail wind. So i think the margin of out performance of europe over the United States is likely to narrow over the course of the year but thats a good play. So youve got your clients and maybe not all clients are completely nimble. We had someone say buy individual companies in denmark. Not everybody is necessarily going to be able to do that. If you do lighten up in the u. S. , what are you supposed to do . Do you sit in cash . Do you buy any fixed income at all . I would not be sitting in cash. We would be overweight stocks. We like u. S. Stocks. We rotated overseas and we think youll get more bang for your buck. How would you do that . Etfs . We have done it with futures. We have done it with futures because we didnt want the currency risk associated with japan and europe because we thought the u. S. Dollar would continue to strengthen. That happened in the First Quarter and now were starting to see the u. S. Dollar flat line a bit here and consolidate. We think thats likely to be the trend for the next quarter or so. And you also think this is a market for the dollar and u. S. Stocks will continue to have that head wind in currency. You have to remember that the u. S. Is a relatively closed economy. Just 13 exports so the u. S. Can absorb the head wind of a rising dollar. In the late 1990s we had a very strong dollar and still had the u. S. Stock market outperforming. So this year is going to be a descent year for u. S. Stocks. I dont think it will be a great year. Year to date up through last friday were up 3. 5 . You get to a number like 10 so similar to what we got last year. I dont think we can expect much better than that given the fact that earnings are likely to be flat to weak this year given some of the head winds weve talked about. The stronger dollar. Energy sector taking a big hit on earnings but thats not going to be the case in 2016. So we think earnings get back on track because we think this is likely to be a very long expansion. Possibly one of the longest expansions ever. Long slow expansion. Yeah. So you dont think that do bull markets ever end before the enof an expansion just because of sentiment . We have this rsvp frame work. You want to be in stocks except for recessions stocks excess valuation, and policy mistakes. So if you sort of go through each of them the probability of a recession in the current environment. The possibility of policy mistakes is a low probability in the current market. Valuations are a little bit above average but not excessive. May have already made a policy mistake. Made a series of them which ones . Fiscal and monetary tightening. The economy has been what fiscal tightening. Were still at 0. Well the end of qe. Well no i mean, weve had fiscal tightening for several years and now thats starting to lighten up. The economy is going to be at 1 . Fiscal tightening. In terms of monetary tightening you know were just beginning but i think the economy is Strong Enough to stand on its own and take off the training wheels of 0 Interest Rate policy here. So i think the fed will move in september if the economy bounces back in the spring as we expect. We think this weak First Quarter, which youre going to see reported in a couple of days is probably going to be about 1 1. 5 or so. We think thats largely driven by one off factors. The weak winter less energy cap ex. But you think the fed will raise rates even if china gets into quantitative easing as europe is doing the same thing . I think the fed is going to raise rates but i dont think were going to see a fed thats going to be aggressive here. Im going to take them at their word that theyre going to be data dependent. Thank you for coming in. Thank you. When we come back this morning, a bird flu outbreak in the midwest. Millions of more birds at risk this morning. We will have the latest. Plus the streets reaction to aetnas latest results. Revenue coming in a little bit light. An analyst will join us on set right after this. First, heres a look at this date in history. [ radio chatter ] [ male announcer ] andrew. Rita. Sandy. Meet chris jackie joe. Minor damage or major disaster, when you need us most, were there. State farm. Were a force of nature, too. Welcome back to squawk box. In global news today people in kathmandu spent another night outside. The death toll reached above 4300 from saturdays quake. The Prime Minister says the number could reach 3,000. Nepal is still experiencing what must be horrifically frightening after shocks and, in fact one of the people that were told it was two minutes. The original quake was 2 minutes. They said it seemed like it was forever. But two minutes is you know there was one out in california i cant remember 1987. I guess it was maybe a minute. But the fear that you have as its rolling you think that its going to just accelerate into just and then it finally does stop and then the after shocks start but two minutes of a 7. 8 and you know its a scale so a 7. 8 is ten times stronger than a 6. 8 which is ten times stronger than a 5. 8. The whole thing is frightening. Completely frightening. It makes you worry about california. Being on a mountain knowing that an avalanche can fall too. Back here in this country a different kind of horror but lets not include it. Bird flu cases said to be probable in iowa. Initial tests positive at five commercial sites. In the state more than 6 million birds are effected. We had an analyst on that said were not supposed to worry about it. This is 20 of the bird population in iowa and thats where you probably look at things differently. These numbers keep adding up and there has to be a point where they say this has great impact on prices. Youre not going to get rid of it either. We could be talk about it for years. No right. Different states. The problem is its wild foul that fowl that spread it. You cant control it. Beef prices are already really high. And as we have heard from other analysts dennis was pointing out its the corn prices where you see it first. Some of the feed prices. Maybe that will help the fed. Aetna is out with current results. Revenue a little light though. Theyre raising guidance to just above the current consensus. Before they were at 7. Now theyre talking 720 to 740. Joining us now with more is the managing director and Senior Research analyst. Thank you for coming in today. Good morning, thanks becky. Your general thought is this is a good report . Its a good report. Its 30 cent raise. Typically Insurance Companies dont raise by the magnitude of the beat. Aetna has a specific issue as well. The state of kentucky rebid their contract so the second half of the year im estimating as much as 10cents of pressure from a reduced rate. So one of the things i wonder is weve seen a lot of companies with issues on the revenue line maybe coming in lighter than expected. Especially International Companies dealing with Foreign Exchange issues but when they miss on the bottom line sometimes they beat on the top line. Not by 45 cents. What happened . How did they manage to have such a strong beat when revenue is not what analysts expected. Aetna raised prices significantly. The consolidated medical loss ratio both beat expectation substantially and the miss on the revenue was for membership as opposed to pricing. It came from medicare and medicaid. It surprises me why its so much higher. They lost a contract or something in the employee market. Overall, how does aetn harksa match up with some competitors. Its good that they reported well on commercial margins in particular and government margins because theyre very transparent on their reporting. Its some what hard to tell from united. I think this report should lift manage care erngs. It sets off anthem which reports tomorrow and is fairly focused in a good way. When you Start Talking about how profitability is up at some of these health care ensurers you get to the point where people say, why. Obamacare was supposed to be defending these massive profit increases. Is there pressure that comes back at some point. Overtime commercial margins will continue to come in. Its more of a slow bleed down as opposed to a big cliff. Aetna trades at a discount on this continuous fears that the margins will compress all of a sudden. Cash flow yields are very high. I dont think well see this cliff, if you will. So its a good report. The earnings should continue to be mid to high Single Digits on the core earnings. Why do they have better margins . Better operating company . Well last year all the companies saw a lot of pressu