Look to portugal, tenyear rocketed to 4 , was 358 friday as the european indexes there are firmly in the red. Road map begins with the sell off on the globe; jobless claims fall from a week ago, and european worries drag down equities in the u. S. Family dollar profits fall for the third time as Carl Quintanilla icahn continues to push for the sale of the company. Costco, sales flat in premarket despite same store sale numbers strong. Allergan fights back after the bid to take it over. Well hear from the ceo. Third time the charm for bank of america . Reportedly submitting another capital plan to the fed to raise its dividend. First up, though, look at the premarket once again. A number of things working against the bulls today. China exports did miss for june, 7. 2 , looked for above 10. Fed minutes yesterday show us that the tapers probably going to end in object. Portugal worries about banks. Gaza Ground Invasion looms still, and industrial output from france and italy, worst misses seen in two years. Thats the negatives, and thats impacting now, but jobless claims better that morning, down 11,000. On a fourday sample. Four week moving average came down, and thats what wow want to see, continued improvement in the u. S. , labor market, europe seems to be spooking the markets because the fed minutes, nothing new, yes, the end date for october, but they didnt say much about higher Interest Rates. Thats to figure out next. Oil, though, down ten straight days. A record. A head scratcher given the worries we have in the persian gulf. Without a doubt. And, in fact, we saw, obviousl,; the response in oil when that began, but youre right. Well see how long that continues, not having, perhaps. Effect some thought on airlines, well, delta went down more as a result of not great numbers there, but American Airlines yesterday, quite the opposite being strong. But, yeah, listen, commodities may be the concern. You have a bid for gold, shooting higher. Had a good year overall, and thats what you see in the bond market, treasury, and, i mean, here we are, gold right now, up another 1. 3 , and temperature year yield below 250, who would have thought . Yeah, me men tum names, Lumber Liquidators and pop belly lowering forecasts, but not by a little. No, and getting punished. Tractor supply also. We kid with jim that these are keys to the market, but they are extremely successful stocks to own, as you said, momentum trades. Brutal. Tractor supply also. That worries me, perhaps its a threesome again. Kidding in the sense, but we talk about these names, carl, in all seriousness because they are reflective of momentum in the market and what happens when it reverses. Perhaps more finds on the Housing Market as well. Lets talk more on the markets today. Lets bring in john manley, chief equity strategist here. John, we went through the negatives, but what is causing sell off . All of them. I think last time i was not worried was march of 2000, nothing to worry about back then. Bull markets climb, walls and worries, and days like this is typical of bull market corrections, nasty, brutish, and short. People dont believe deep down. Short meaning . Are we vulnerable to a 10 correction . 4 to 6. We had a lot of those. When we get that much, scares people enough. Thats thomas hobbs on life, not markets. Im an intellectual, but i hide it well. All right. For those waiting for a tradeable correction, this is it. How long do you wait . This is one of many. Give it a few days to settle. You can get the feel for it. Its trying to get the sense we scared people enough. Why is it it takes 5 , why sometimes 25 to refresh the skepticism makes things go higher . I think we get there quickly. I dont think portugal is an enormous situation. Dont under play it, but you dont know what happens. In all these things, it fuels worry as people see its not the end of the world. Expectations for earnings growth, 5 to 6 usually prove conservative. Positive enough to keep the market going and offset Global Concerns . I think so. Something you look at. Im starting to see signs of the numbers of, expectations rising, a little bit of juice in them, a good sign. Somethings happening. Earnings coming through okay, but i get the sense the annual numbers are going up. Not the case until very recently. People ask questions, not maybe about portugal, but about europe. What happened . For a while there, looks like they were getting their act together, and now the manufacturing numbers are pitiful. They are not good. Disappointing, but back to the drawing board. Theyll try something else. You know, they have a template, whats done in the u. S. Works, our system is more effective and efficient than theirs is, but they have something to follow. Its not that bad. I think the central bank will do whatever the central bank has to do to make things better or try to make things better. Whats interesting about todays session is we see correlations come back, risk on, risk off type of stuff, gold higher, treasuries higher, u. S. Stocks down. Unusual given what weve seen over the past month. Correlations breaking down all over the place in asset classes. The last two months nothing going on, less than 1 moves, nothing happening. Its starting to get starting to rev up a little again. In terms of activity, volatility. I mean, its not unhealthy. Id rather market go up 25 points every day the rest of my life. That would make me happy. Its not going to be that way. You have to refresh fear, and markets like that today and in the next week are like. Defensives in the markets . No. Im still in basically cyclical sectors. I Like Technology and the hightech and old tech. Im in industrials. I think america builds out, earnings are coming through. Energy, i think theres going to be a big build. Its not the price of energy i play as much as the activity going on to expand Energy Production and delivery. I dont need to tell you on housing, the number of companies that today, Lumber Liquidators, usg, stock is coming down. The clues about a slow down in housing, and retailers saying on consumer spending, this week alone and more today. Thats two big pieces of the economy. It is two big pieces. They are early cycle stocks. At some point in time, that economy gives way to capital expansion. Thats one of the reasons were playing industrials. Whats weakness in housing is weakness versus expectations, weakness versus what it was two or three years ago . I think the Housing Markets doing okay. Its not getting the daytoday stimulus with rates down, fed added money to the system. What about Profit Margins . Continues to be the date, whether they peaked, whether they can sustain high levels . I think Profit Margins are high by standards, but high for reasons they were not before. In the past, we had a Strong Economy for two or three years when margins got to the level. Its a Strong Economy. American corporations are more efficient, and if we get a better economy here in the u. S. , i think youre going to be pouring more revenues over very lean. Youre on tptimistic. Looking for good guidance . 5 can happen at any time, and im willing to change my mind, but feds accommodate, and evaluations are moderate to me. We get a better economy, we could have been saying the same words, and, in fact, heard them so many times, and yet we have not got that better economy, but an okay. Right. You know, the way i look at the target, make money when things when the economy goes terrible to bad, from bad to okay, and i think its okay. Going from okay to bad . Yes, exactly. Bad to terrible is really bad. Been through that too. In the end, after reading the minutes, are you in the school that yelleyellens hawkish or m dovish . Shell follow her own path. I suspect shell air on the side of the angels. Theres a riskreward there. If i had to place a bet in one sentence, earnings go up before Interest Rates do, and thats good for the stokt. Good for the optimism on a down day in the markets. Family dollar out this morning with first Earnings Report since icahn called on the company to put itself up for sale, profit of 85 cents for the fiscal Third Quarter, a miss. Revenues above consensus despite a 1. 8 drop. Costco Beat Estimates helped by rising fuel prices, transactions up 25, and fx less head wind. Really, the only thing to worry about was electronics were flat, even though theres inflation in good food. They have momentum. Interesting to read the quote from the ceo of Family Dollar, results reflect economic challenges facing our core customer. Hard to figure out where the core customer is in terms of consumer spending. If they are challenged, they would go to the dollar stores, walmarts of the world. Those are the ones that are having trouble right now, and the costcos doing better. Not all in trouble. Family dollar, i saw that quote in the last quarterly releases. I think they trot it out on a regular basis. Consolidation continues, of course, to be a Big Conversation amongst investors in Family Dollar area, Dollar General seen as a potential acquirer or walmart, unlikely as that seems, hope springs eternal maybe the small store format shows itself to be advanced by consolidatioc, but well see if any of it happens. In the meantime, stocks this company, particularly not performing well with Dollar General, an outgoing ceo in may of next year. People think the deal when it happens speaking of walmart, Family Dollars going to start offering wine and beer next fiscal year following in walmarts path. They see q4 comps flat, the coming quarter, and analysts did not guide lower, which suggests to some, at least if youre a believer that the worst is in after, obviously, the tough environment, you know, theyve been a part of. They are continuing restructuring, right . This is the defense, closing stores, opening fewer stores, cutting costs when they can, and carl icahn still pushing the company. Yeah, hes not going away. More than 99 , right . Costco performing well. Yes, helped by gasoline prices this particular quarter, and, again, an annuity business, most profits come from the fee and they can put up respectable comp keeping margins where they want them at 15. Interesting. Loyal fan. I have not been to a costco in ages. Really . I have not been in hours. I think you need kids to go. When we come back, allergan ceo and what he told jim on mad money last night. 11 00 a. M. Eastern, jeff jordan, previously ceo of open table and president of paypal. Take another look at futures. We have not had a 1 move in the s p since april 10th, and today might actually be the day. More squawk on the street from post nine in just a minute. Really. So our business can be on at ts network for 175 dollars a month . Yup. All five of you for 175. Our clients need a lot of attention. Theres unlimited talk and text. Were working deals all day. You get 10 gigabytes of data to share. What about expansion potential . Add a line anytime for 15 bucks a month. Low dues. Great terms. Lets close. Introducing at t mobile share value plans. With our bestever pricing for business. Been awhile since we saw a futures board like this. Looking for a big drop at the open today, dow down 160 points or so on a number of head winds well talk about. Bill ackman trying to shake things up at allergan, and the ceo has a bone to pick with ackman and came out swinging on mad money, take a listen. Bill is saying that you have gotten, and im quoting, a disabling conflict of interests which arises from the fat that you will lose his leadership role at the company and likely his job as a result of the transaction. When i started allergan, it was worth 2 billion, and before Persing Square appeared, it was 42 billion. You know, i got enough money to put a meal on the table, and, in fact, unlike so many other ceos, im not interested in what happens to me short term. I only care about Value Creation for allergan stockholders. Interesting from here on out. Its going to take time. Thats important to point out as well, interesting that he decided to come public. He also met with a number of reporters on background yesterday making the rounds, if you will, in new york to put out a few story lines. Which weve heard before. Namely that vail i cants product line in terms of ogranic growth is not really there, but importantly, when i talk about time, yes, this is going to potentially ramp up, but you may be looking at a december shareholder meeting, and, certainly, theres months to go here in terms of allergan fighting ackman and say its not way it appears to be, would be a mistake for allergan shareholders to vote for the deal when they get et opportunity in terms of so listation which they need 25 for. Not easy. Vote for the consent, hold shares to vote them at the meetings, and consent is voted in order to then vote 50 shares to get the board out, if you can follow me there. Well see what develops here, allergan is fighting the fight now, and he said time and again im not in this for any other reason than to do what the owners want me to do. Interesting, he say this on mad money and in other conversations, hes hearing from the shareholders a potential acquisition by allergan may be the number one thing the shareholders want him to do with the cash that he has, given the Free Cash Flow they are generating, and the debt capacity they have on the Balance Sheet. That stirred people ina bit yesterday. Journal reported on it, and i also say he shares that over time. And shire, citing analysts, trying to be taken over by abbvie. By the way, we have not heard from shire since abbvie made a proposal. It would be an inversion if allergan were to do that, but inversions require shareholder vote, and that begs to question, would shareholders allow it to buy cher to avoid vail yent. You take up the debt capacity on the Balance Sheet which valient needs, and you would not need a shareholder vote. That would be something to do, but if hes a man in favor of rewarding shareholders, he has to make that decision whether thats the best way to go. And valeant could raise the bid. Couple nice pots boiling on the m a stove. With activists and big stakes. Of course, that was unique in that he teamed up with the operating company to do it, hedge funds said, how is it legal he knew about it . Of course, it was, and the same response was, how can i get a deal like that . When we come back, looks like a day to fasten the seat belts. Would he have a helmet on, david . Maybe, maybe on the desk. The desk. Not helmet on head territory yet. What art cashin has to say about it, and a look at the trade, dow down about 170, and more squawk on the street from nyc in just a moment. I make a lot of purchases for my business. And i get a lot in return with ink plus from chase. Like 50,000 bonus points when i spent 5,000 in the first 3 months after i opened my account. 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Is that really what this is about . Well, its 90 of it, yes, yes. Its been brewing for a couple days over there, and it started in the commercial paper market in a bank subsidiary, and they had to defer a payment, spread to the bank itself, and the bank is down 32 over the last four day, and portuguese market was down, dow equivalent of 750 points, so that has spooked everybody. Its begun to spill out into some of the other club med areas down there, a little in spain, a little bit in italy. While you were speaking, i think we have breaking news on portugal. Lets go to michelle carusocabrera. Reporter to followup, the regulator in portugal announced they would suspend trading in the shares of the Problematic Bank talked about tonight pending material information. So we are waiting to see new news about anything to find out. Remember, its initially the problems with the Holding Company that art was referring to, but the bank has investments in the Holding Company, and they have clients with exposure to the company and, hence, the dramatic decline seen today and several dayings as we wait to see whais gone on there, and theres concerns with the bank over the last couple months as welcoming to the headlines. Carl, back to you. Michelle, thank you very much. With all that in mind, art, i mean, futures are weak, but they are the rustsell will be smacked the worst today. The russell, social media groups, feeling on wall street those positions are heavily levered, one of the reasons why you saw an 8 drop in a dozen stocks without any specific company sensitive news. Art, trying to gauge the sort of level of worry right now. Portugal is a small country. We dont follow it too often, but we are having deja vu to the european stock crisis when the u. S. Had a 10 correction. Does this spiral the idea of the bank and sovereign to other bigger countries in europe, or didnt the ecb fix all that . Im not sure they fixed all that. They talked a good game, but well see how well it holds. What you got to frvt here and everybody is sens