Invidia are focused. Our road map begin with stocks having the worst day in months as tensions over north korea rise the president tweeting that military solutions are locked and load. Dispinting earnings despite the fact that it added 7 million daily users in the quarter well dig through the report plus awkward moments on the Conference Call. Shares of jcpenney said to open at a record low well take a look at the future of that company and of course retail at large. Straight to the markets coming off the worst day for the dowt s p, the nasdaq since may 17th the rising tension between the United States and north korea although being balanced out today by this inflation data that we got in the earnings. Everyone looking for whether yesterday was going to be a one day jolt or not. Seemed like a different tone maybe a change in character for the market you didnt have a late day rally. Closed on the loes of the day. Sort of more sensitivity for the north korea headlines than had been before. Its hard to say what youre looking for to say this is the extent of the dip but a lot of people are saying we have to wait for maybe a little more of a flush but the data today is all of a sudden got pushing out again what the fed might do. The inflation at a at a is worth digging into because it tells a very mixed story about this economy overall, prices, consumer prices, what we pay rising 1. 7 from last year that doesnt tell the whole story. If you break it apart by groups t goods groups are actually showing deflation in a lot of place. Apparel is still negative vehicles are negative when it comes to used cars and trucks down 4 from last year but then you have the services, medical services, transportation, shelter, all of that is seeing year over year gains medical services up 2. 3 so what you have here is a tail of a mixed economy and overall soft number which does, i think, raise questions about whether the fed can raise Interest Rates in this environment given the falling Unemployment Rate one on side and falling inflation on the other. The fifth straight month when core cpi missed expectations. Its not about wire lesser vis. Remember you had janet yellen say there was this odd ball thing. Everyone went to unlimited data which was true but goods have been persistently on the decline. Except for food thats going to help stock like kroger and walmart that sell food and we didnt see that as a negative number. Was in the low 40s yesterday and bullard has been pretty clear. Theres things going on in technology and other places that make this difficult to read. Its the markets getting jumpy in themselves. A lot of times thats the immediate next story maybe this is going to put the fed on the defensive by the way, also german ten year yields below. 4 thats a level a lot of people were looking at so this general global tone of slower and disinflation is in place. We have the transports below a 200 Day Moving Average its been about a year. People are look at 5 . Yes so i think the message there is that yesterday wasnt this kind of one day or two day reaction theres been an undertoe to the market for awhile. You had a lot of the cyclicals and small caps not participating and it got stretched so were doing too much of the work and have been pulled back. Amazon is down 12 from the high. If youre talking about north korean tensions you did start to see it weigh on the asian stocks overnight. Hong kong one of the best performing markets of the year down 2 . The kospi that we have all been watching closely tells the story of resilience all yearlong but that cracked a little this week. Yes it follows what we saw with global stocks but samsung down 6 this week that was a big drag. Whether thats part of the tech story or part of the worries around North Carolina story. A little bit of both. Kospi is look at the worst week for a year. The war or words is continuing this morning between the president and north korea. Theres a lot to bring you up to speed on. Weve seen a new tweet from the president of the United States rationing up the tensions between the United States and north korea. Take a look at the language used in the tweet this is a president thats very much focused on this engagement right now. He said military solutions are fully in place locked and loaded should north korea act unwisely. Hopefully kim jong un will find another path that just within the past hour also hitting the wires are comments from Russian Foreign minister lavrov that is speak, those comments hitting the wires. He is saying there is a russianchinese plan to diffuse this crisis in north korea and theyre also saying that the risk is high of a north korea conflict thats something he says that russia does not want to see. Thats an interesting comment because part of the speculation here has been that Donald Trumps escalation of rhetoric has been designed to bring the chinese into the diplomacy here to solve the north korea problem if the chinese and russias are getting in with a solution of their own that could be a development to monitor throughout the morning as well were also seeing news from Angela Merkel the german chancellor that says she sees no military solutions to this conflict whatsoever. So Angela Merkel here urging caution as the two sides continue their war of words throughout the morning this morning. Meanwhile, you mention merkel, as World Leaders begin to weigh in here but a lot of people paying attention to this editorial in one of the communist Party Official newspapers in china basically saying that china will oppose any u. S. Effort to try to depose kim. Right and thats so important because it shows that china is not yet with the United States in terms of the diplomacy here the chinese used north korea as a proxy here against the United States for decades whether or not they can be brought fully on board in terms of a diplomatic solution here is the question if theyre signaling that they would not be part of a regime change effort now that might be reassuring to the north Korean Leader and well have to see the impact of that in one sense it could be a stabilizing thing. In the sense that it doesnt provide north Korean Leadership with a reason to panic now. The president ramped up his rhetoric against north korea and has also done so against the Senate Majority leader whats the reaction to that on capitol hill especially from Senate Republicans as we all try to ponder the status of tax reform and whether theyll be able to raise the debt ceiling on time and avert a Government Shutdown . People are baffled. Republicans are baffled by the president s attacks on Mitch Mcconnell. The reason hes doing this is to show that hes an outsider but then you saw him give his full support to Mitch Mcconnell saying hes been one of the best leaders they have seen in the senate on the republican side so this is a lead their has a lot of support among his colleagues that look at the president s efforts here to be little him as simply unhelpful the president would like them to come back around to balm care repeal and replace and it seems very much like Senate Republican leadership would like to move on and do tax reform this fall as promised remember they have got a big legislative calendar here. They have a debt ceiling fight coming up. They have to do a budget and they want to do the tax reform effort as well all of that is going to require the president and the Republican Leadership to work closely together and right now what were seeing is that. Well talk to you in a bit. Thank you. Well switch to snap following double digits after reporting a bigger than expected loss missing on the top and the bottom line. Fewer users than anticipated further controls about competition which was addressed on the Earnings Call last night. We have always been last to market come peeth against companies and we have been able to grow our business in markets that are highly competitive and saturated by our competitors because were so focused on innovation that explains why were willing to take this wait and see approach in markets that dont make Financial Sense for our business at this point but may make sense in the future. Of course saying he wont sell any shares this year except for those that are tax obligated but still under pressure this morning for not giving more clear guidance to the street. And perhaps because they cant do it. A diversity of opinions most of them are less than positive lets call it. Here in the u. S. As a positive sign the growth there not bad still not meeting some analyst anticipation what it would be but those at least trying to be positive are certainly looking at that. At the same time we have people that say well if the market cap that this company has doing about 180, 2 million in revenues now and losing 194 million why am i anywhere near this. Its still not clear to me that the growth path is there i would refer them, our friends saying snap should never have gone public when they did or how they did. Obviously with that valuation you have to hang your hat on things like momentum and advertiser adoption, momentum and usage. All of these things that are nonfinancial they can say fine this is getting us quicker to a place we can justify the valuation and a lot of people are saying we cant find it yet. Maybe its a longterm story and six months you wont have the evidence but also the overhang of it. Nobody is really sure. Which is monday. Monday morning so if the market going to be swamped with new stock or is that going to be that occasion that said like facebook okay all the supply all the analysts are wright about the facebookinstagram competition and thats when the results started to turn. When momentum started to slow and same with the average revenue per user there was a funny moment, i dont know if you caught it on the Conference Call when he asked aquestion and there was hot mic moment when one of his assistant analysts got caught make fun of the response listen to this. People as they become more reliant on notifications relaxed the standards there and its important for our business. Thank you. Our next question i didnt even understand his response okay. Thanks. Everybody heard that. That was the response to the question which is a difficult to understand concept. I guarantee not the first time a snarky comment was made this one just happened to be caught. But to your overall point whats the value of proposition for advertisers on this platform our own Parent Company owns half a billion dollars worth of stock. I dont think were spending more than 10 million from universal and some people are looking at that and saying if the big owner is not spending who will be. Some people are fixated on the iphone 8 the capabilities in terms of augmented reality and better camera features and as if thats going to be this rush of new sign ups i dont know if thats justified or not. Overall a lot of price target trimming but not many downgrades p per se theyre still early in the process of monetization. When we come back, speaking about the pressure, jcpenney getting hammered at the open thats on track to open at aa record low you have to go back to the early 70s to see a stock price this low. Well dig through the earnings take another look at the premarket. More squawk on thetrt om st 9 continues in a moment Courtney Reagan joins us with more on the report and this ugly reaction as well. Thats true hate bringing all of this bad news but shares hitting 45 year lo lows more shares traded premarket than we get in a typical day already. The ceo is currently speaking to analysts on the earnings Conference Call. Hes not his typical upbeat self a 9 cent loss. Thats almost double the loss forecast they say its the results of Liquidation Sales of stores. They sell everything as much as 90 off tin the end. The Department Store is reiterating its full year earnings guy danidance but it ho make up all the earnings and today the premarket share price indicates investors do not believe that it can get there. Revenue is coming in stronger than expected with comparable sales shutting 1. 3 which was in line with expectations nearly all categories approved particularly kids apparel but cosmetics was weak and thats an issue because we know it drives a lot of traffic nordstrom reported it beat across the board but unlike macys and kohls comp sales improved premarket shares only marginally higher because of the pressure from the sector. Thursday we got those low area cross the board. Even those that beat consensus for two key reasons. Shares have run up anticipating an improvement in trends that we did get in fairness but investors are losing faith in the longterm viability of that Department Store format. Next week well hear from coach, home depot, tjx. Thats on tuesday and target on wednesday and the biggest retailer of them all, walmart on thursday along with ross stores. Its a tough day again for Department Stores. A lot of those. Arent there . Thank you very much Courtney Reagan covering jcpenney today well take a break and another look at the premarket as futures rebounded. Well cover them as well requk enlk ahead of the op mo sawon the street in a minute um. Im babysitting. Thatll be 50 bucks. You said 30. Yeah, well it was 30 before my fees, like the pizzaordering fee and the dogsitting fee. And the rummage through your closet fee. Are those my heels . Yeah yeah, were the same size. In shoes. With tmobile taxes and fees are already included, so you get four lines of unlimited for just 40 bucks each. And now, get zero down on the hottest smartphone brands. At ally, were doing Digital Financial services right. But if thats not enough, we have 7500 allys looking out for one thing, you. Call in the next ten minutes to save on. And if thats not enough, well look after your every dollar. Put down the phone. And if thats not enough, well look after your every cent. Grab your wallet. Access denied. 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People decided that nothing much is going to happen until korea makes its decision about whether its going to fly some missiles close to guam or not and thats due later in the week next week so we have time here for rhetoric thats an editorial in one of the prominent chinese papers that seems to be a warning to both sides to north korea that if they initiate hostilities china will not aid or assist them and the u. S. If they initiate hostilities then china will come to the aid of north korea and thats a warning and then finally i think theres concern here that the president may be boxing himself in rhetorically that hes kind of got into the line in the sand kind of routine that if they do something theyre going to be surprised. Were going to hit them in a much harder fashion than they believe and then if something comes up and there arent any military options his credibility is a little bit stretched. So you have all of that confusion and these hard to quantify factors on top of a market, it was tired and there were areas that were a drag on things so now you have this cool inflation number what does that leave us here in a late summer period where sometimes it gets choppy. Well, people recall a couple of weeks ago i was on saying that in years ending in a 7 you have a top emotion in the second week in august and maybe thats happening. But i think youre right there were divergences and other signs and right now they probably decided its not going to be a nuclear event. And thats why we didnt get hit much worse and theyre going to try to drag their feet assuming the next move is up to the north koreans and Nothing Happened so nearly the move of next week. Did you see the latest posting recommending 5 to 10 of assets should be in gold theres an increased bid for safe havens this week in gold in the japanese yen a little bit in treasuries, do you we know when that buying turns into panic interestingly this morning you had to move toward the havens that has sense changed the goal is not seeing the upward buying pressure so i have been saying this since the quote, unquote, crisis began i would continue to watch the safe havens. They will be your thermometer and tell you how hard the fever pitch is going to go finally, people are circulating a story of the late mike epstien can you tell that story really quick. Its actually, i think mike took it from me. We were good friends my version of the story was my dad died when i was a senior in high school so hi to pass up a college scholarship. I got my education in bar as around wall street and as long as i had enough money to pay for it an anyway, there was a heavy rumor that the russians had actually pressed the button i tried to buy some puts it didnt work as only an 18yearold would i ran hurriedly into the bar an i said the rumor was the russians pressed the button and i tried to sell the mark and i couldnt. He said buy me a drink and sit down and listen to me. When you hear the missiles are flying you buy them, you dont sell them. I looked puzzled and he said you buy them you