Frans 10year yields, spain is at 2. 88. Just to put that in perspective. Rates are way too high in this country. Im not kidding. Talk to frank blake, home depot. Look at europe at this time, kind of a mixed bag. Stocks started with small gains off the lows, about flat, lets call it in a lot of different ones. Not a lot of news out of europe this morning. Consumer staples, basic resources, health care lagging, financial services, banks, media and telecoms up. Our road map and it does start with the markets. Looking to make history, the s p aiming for another record high. Weve got earnings from Toll Brothers and michael kors, adding to what has been positive sentiment. Lots of buzz at the code conference surrounding googles driveless car. Carl is at the event and he is going to fill you in. M a also in the spotlight as it has been lately. Valeant increases its offer for allergan. Ge making its case to the french for why it should be allowed to buy al sted. Futures on the high after the s p hit a record closing high for a second consecutive session, shy of 1912. On the earnings front toll brother which posted better than expected results, profits more than doubling. Michael kors beating the street with its fiscal q4 results. Global samestore sales up more than, man seems hard to imagine, 26 . I didnt like the Gross Margins. Really . 26 . Samestore sales. Would be a little higher. Thats asking for a lot. Just telling you. They were giving up margin to make sales. 2 26 . Come on. Why the stock went from 98 to 95 and go over the Conference Call and theyre saying they thought analysts were expecting 60 , did not meet the expectations. This is my friend Herb Greenberg all over this thing. Look, yes, its kate spade and this company are the two best in show in the accessory Department Williams sonoma best in show in all of retail. About a company that sports a roughly 20 billion market value. Its more than a double over the last year. Well more. Its had the momentum and no one has those comp stores. Then again, nobody no one can raise price here and, you know, i was hoping that kors would be able to tell a better story, but im looking for too much. If im an investor and see that run behind me, lets call it its lower than its high as you point out. Nonetheless should i be thinking margin compression, maybe things get a little more competitive. You just dont want inventory. You dont want inventory. Right. You never want inventory. Its a push for a big momentum stock is not what people want. Workday is not a push today. Kors never came in Toll Brothers this morning is going to be up in the premarket, up about lets call it about a buck and change over 4 or so. 35 cents a share, ahead of estimates. Revenue 860 million, well above estimates there, were betting 827 million. I love this court sghooerts Gross Margins doing the right thing. 26. 6, fiscal year 2013 backlog of units is 27. I think the average price of net signed contract after 729,000 versus 678,000 is good. They have a project in brooklyn that apparently is selling huge. I point that out because when you have manhattan real estate and brooklyn real estate you can raise the whole price of your average seller. Theyve got interesting projects right down by the water, at least theyve had one some time. Visited it this weekend. Im a believer in toll. 67 unit growth. Home building deliveries. This is a quarter that when you dovetail with the 2. 4 you mentioned for the tenyear says dont short this. Go long it. 37. Lets back up into the markets. Second consecutive session. Were right around 1912 on the s p. No longer seemed that concerned about what was a tougher road in march and april. Whats happened is that theres still one more rotation occurring. It is incredible. Go over the workday Conference Call. This Conference Call, this quarter for workday which you know is one of the Great Software service companies, knows you well we know each other, yes. This is one of the quarters that had they reported three weeks ago the stock would be down today. You said software as a service as opposed to sad, which is something you coined, software as a disservice. There are faux software disservice. This is mark benoff the king of salesforce. Com and this. A lot of companies that came public that were me too and not going i think to have a good run of it. Workday very interesting to hear the operating cash flow, not as great as i wanted. Right. But they won hewlettpackard which was a very big piece of business, won phillips and winning terrific not just Human Capital, their Human Capital software, winning finance including netflix. Thats one to watch. It was a good quarter. They in the Conference Call to this important point. Moving into a new area. In terms of a momentum stock with an incredibly high multiple we saw move from lets call it 50 to as much as 110 over a short amount of time, peaking when all so many of these stocks did in late february. February 28th, the day salesforce. Com opened at 67, went to 668, plummeted went to 68 then plummeted. High 60s to over 110 a share. Is this the end of the rotation, back to looking at okay, im happy with the multiple because the groth is there. That would be insane to do that. It would be insane to go back to the world that we thought was where we could value these companies on enterprise, value to sales. I dont like that. I do like the fact that they absolutely took another shot at oracle and sap and said dont worry about our business. Were not going back to that world. Were not going back to that crazy world. It does seem like a lot of sellers have finished in biotech. They finished in the high multiple tech. They finished in the momentum stocks but were not going back to that world. That would be too glib. Workday sold to you i like workday very much, but i dont like paying up here. Hows that. I think thats im trying to be a diplomat. The company has the best product. Thats not necessarily what makes for best stock. Workday headquartered out there in california where we find Carl Quintanilla at the inaugural code conference. Good morning, carl. Hey, david. Man, if you guys if anyone likes technology its been a Pretty Amazing 18 hours here at the inna nag gral code conference. Well talk about what Satya Nadella talked about his role at microsoft, but the news of the day the google selfdriving car. Unveiled by sergei last night. The first prototype made from scratch, no Steering Wheel, no brake, no pedal. Maximum speed 25 miles an hour although that could change over time. He sees couple hundred, 300 prototypes over the next several years and eventually this could lead to a partnership with someone like an ubber who by the way was a beneficiary of funding from google ventures. How does google go about building a car . Sergei was asked about that by walt mossberg. Heres what he said. Youve worked with partners like in the detroit area and germany and california. We use automotive suppliers. This is using car parts that are kind of standard but sometimes weve modified them to our needs. How about the whole body. I mean yeah. Weve worked with partners auto manufacturing firms that have helped us with a body. It so is the talk over the entire technology universe. Aaron levy of box tweeted last night and i quote, google is literally making a car and it actually looks awesome. The future, he says, is going to be incredible. Big lineup coming up today. Among the people speaking, travis callnick of ubber, john chen of blackberry, jimmy i owe veen of beats and massason of sprint and here on cnbc, jeff weiner of linked in, eric po of Hair Ventures and Brian Roberts the chairman and see of comcast. 9 40 well talk to kara swisher who interviewed sergei and satya last night and why she named the google car phyllis and talk about her ride in the car which was done a couple days ago. Phyllis . Phyllis. Okay. You are where the action is. Extraordinary. The west coast is where innovation is taking place. The east coast is where Financial Engineering is taking place. It will be interesting to see if these stocks which return to momentum style, do not in the end fall flat because these are not earnings stories. They are pizazz. And right, carl . Youre just getting a lot of pizazz. The car is not going to move google stock. But the Retail Investor likes the car. Yeah. This is a longterm story. No doubt about that, jim. In a way, the point of the conference not to talk about business questions as brin would call it and less interested in talking about last night but more the visionary aspect of technology which is what a lot of these leaders are all about. Right. Theyre not about inversions, theyre not about smith and nephew getting a bid from stricker. That was an indictment of the east coast. There are Technology Companies here not just about financial teslas . Flat iron building . Google does have a big they could ibm is starting its Watson Center in the fall in the flat iron area. People telling me they have good stuff involving spectrum and be careful. Dont go against ibm even though i am. Even though you are. Yep. We got so much more to talk about. Carl is where i mean carl is where can we give you the ball . You are our running back today. Were playing defense, linebackers or cornerback maybe. Ill see you guys in a few minutes. He will take the ball in a few minutes. By the way, those drivers, driverless taxi in new york city one day but what about all the immigrants. The first rung, man there wont be any. We dont want robots 25 mile an hour driverless taxis. Sha hail with your smartphone. Maybe our lifetime, maybe the very end. Can we just worry about the quarter . When we return by the way well talk about companies that are taking steps to make acquisitions or at least try to. First among them, valeant, which increased its offer for allergan. You heard jim mentioned smith and nephew, an ft story well take a look. Another look at futures before we head to commercial break and pointing to a slightly higher open. More squawk on the street after this. Look at that, 2. 473. I told you, of course, you can go to france and get paid a lot less, 1. 7 something. But thats the lowest since july, jim. The lowest yield on the 10year note since july. You come into this year saying im going to short that 10year were going higher, no. We should never have gotten to almost 3 a year ago. Should never have happened. It was out of sync with the rest of the world, where the rest of the world was going and our rates are too high. One of the reason why toll brother wills not stop today. Why this market does have legs, is because the market is going beginning to realize that lower rates make our businesses do better. This counterintuitive period going on for the last month we didnt like lower rates. A year ago remember we started that surge up to almost 3. It was wrong. Markets got crushed. No demand there. Bernanke initial comments there. Made a mistake. Its okay. Move on to m a this morning. Barely a day goes by we arent talking about it. Valeant pharmaceutical raising its offer for allergan. An unsolicited nasty battle, the cash battle up by 10 baux share. Stock component remains the same and the ratio the same at 0. 83 of a valeant share. Also General Electric improving its offer for alstom, according to an official in french president hollandes office. Sources say that improvement includes a pledge to create 1,000 new jobs in france over three years. That news follows a meeting between hollande and the ceo of General Electric, jeff immelt. I dont know where to start. Then we got some news out of the ft. Start with quickly dispatch with ge. My only question on ge announcement why they werent more prepared for that response from the french to begin with and perhaps didnts do the outreach earlier that seems to be taking place. This is one of the things with why didnt you play the card immediately, were going to higher people. Thats all i wanted to hear. But all you had to do was say, you know what, this isnt about firing. Its about hiring. This would have been a snap. Thats my take. Jeff immelt, im not going to criticize try to do the right thing, but a case to be made that had they gone in this is a chance to make this company bigger i dont think you would have much of a debate. Yeah. Bit of a surprise perhaps they hit that road block early on. It does seem theyre making progress. Move on to valeant, progress may be hard to come by. Allergan, i say finally, they had been taking a kid glove approach i would argue to combatting valeants offer yesterday. They did not this morning. Valeant as promised increases its offer, significant, 10 bucks a share in cash. The overall offer going to 58. 30 for allergan. You can see valeant shares there, thats the key still. The currency is a lot of the consideration, though the cash portion certainly is higher. As you see. They are also talking about this product and a cbr that would be valued as much as 25 bucks a share depending on this product. Its for macular degeneration. It would compete against lieu sen tis. And also region ron, good luck. Well get to so much more here. Ill go more in the faber report. Thats ways away. But that cvr is another part. An endless presentation. 200 slides long that valeant began at 8 00 a. M. This morning with bill ackman, of course, who sort of is leading the charge for them as the largest shareholder in allergan. What do you think about the nestle involvement. Thats another thing, right. Selling certain products to nestle they acquired with medicsis. Buy it for the idea of having restyla restylane, botoxlike from your nose to your down to your chin. It works like that. For really wrinkles around the mouth. And juvederm is a product allergan has pioneered against that. Whats happened is that you bought metasys. You fire a lot of people. Next thing you know you sell the products for 1. 5 because allergan has a product, they need this deal now. They got to get this done. That was a principle reason why they bought met sa sis. It is a rollup. Valeant is a rollup and they need the deal for any number of reasons, including their strategy, of course, is to continue to acquire, use a low tax rate, use the strategy that they claim is completely misunderstood by allergan in terms of really efficiently using capital, efficiently looking at r d, cutting a great deal of it. Thats the strategy. By the way pearson in the presentation saying the nestle deal is a win win transaction. The natural buyer and eliminating one more road block in terms of integration with allergen. Save smith and nephew for the mad dash. And nestle, what are they. Right. What are they . What are they now. Theyre big. A big they give you pimples with their chocolate and solve your face problems with this. Up next cramers mad dash as we count down to the opening bell and talk smith and nephew. A look at futures. Back with more squawk on the street after this. I make a lot of purchases for my business. 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Read you some of it. Citing sources, process at an early stage, exact value that stricker is putting on smith and nephew could not be ascertained but any offer would likely be above the 3. 85 billion pound value, a report from the ft. Thats why. Exactly. Get the right price. Smith and nephew, hips dont lie, this is smith and nephew goes up against biomed. This is about hips, artificial hips. When you saw that merger the zimmer to buy biomet had been taken private many years ago, sold to right . You need to do a defensive acquisition. Stricker buys smith and nephew, its inversion, this is killing me that i didnt see this coming. Because its obvious that smith and nephew is a way to be able to do this inversion. Its a win win. I think it happens. And i want to make that point. This would be another inversion. Yes. For so stricker would, therefore, benefit from a lower tax rate in the uk and pointed out many times the ability then to start taking car that is overseas for deals in the u. S. Without having to pay taxes on bringing it back because you would no longer be a u. S. Company. In an inversion you do have to issue at least 20 of your company in the company youre acquiring has to receive stock in excess of or equal to 20 of your market cap. Which does at least prevent the biggest of deals. If youre 100 billion Company Issue 20 billion in stock. Thats not the case here. I wanted to make that point we talk about inversions left and right and all over the place. Stricker is issuing a statement. One thing thats important stricker up big. This is the pattern. This is the pattern when you do the inversions, the buyer goes up too. I think people dont understand at home one of the reasons why this market is working so well, is because companies are doing deals and the market is lapping them up. So then your banker which you have told me over and over again, i want to do a deal. I want my stock higher. This is a remarkable time in this business. Inversions are interesting as we said. Stricker says they have no plan to make offer for smith and nephew apparently. Where are you seeing that . Up there. Which would conflict perhaps with the Financial Times story. A dow jones headline that jim read you no plan to make an offer. This is how quickly thin