They will be the Worlds LargestMarketing Group by revenues. Under structure they will retain headquarters in paris and new york and plus a Euronext Paris listing as well. David perrigo in the United States has agreed to buy irish drug company elan for 8. 6 billion. Guess, u. S. Company is going to ireland because they have lower taxes. The deal isnt expected to close until the end of the year. Liz want a job. Maybe amazon will hire you. They plan to add 7,000 jobs to meet rising demand. The company will add 5,000 fulltime jobs in the Fulfillment Centers in the United States and 2,000 Customer Service jobs. David that is good news. Ben bernanke should give a deposition in the lawsuit being brought against the government by former ceo Hank Greenberg over the rescue of the company, aig. Bernanke was one of the central decisionmakers in the huge bailout of the firm. Liz sec resting its case in the fraud trial against exgoldman sachs trader fabrice tourre. In a move the defense team didnt call any witnesses. Closing statements will begin tooorrow. After the bell starts right now. David let us get right to todays action. David cued low, breaks down why socalled barbell strategy helps you profit in uncertain environment. Gerald levy, in the pits of the cme. Jarrod, lets talk about the earnings season in general. We have had two Earnings Seasons since the year began. What do you think about the financials, their effect . Some people think the financials are so big, reporting such big numbers members, partly because of fed is doing that theyre skewing the overall, what say you . There are a couple of different opinions. Im on that side of the coin, that the financials are looking better than they should. Here is something to ponder. 270 companies in the s p reported. Were about halfway threw. Without the financials we would have negative 3. 1 growth yearoveryear. Theyre really carrying the s p, with them included it is about 3 to the positive side. So for me, again you got to look at each stock individually. I think financials as a whole probably a great sector to be in but there are bits and pieces good and bad out of all of them. Traders are looking for rest of this week, big adp in birand bls number and a lot of confusion happening right now. Were trying to figure out are these markets driven truly by just the fed or will we begin looking at earnings in actuality. Frankly i think the fed is carrying more weight than earnings, this earnings season is knot much better than what we saw last season. By the way, earnings beats, 56 this season versus 68 last season. So, again not as good as we saw last quarter. Liz yeah, but the markets continue to grind higher, jared, right . What are you talking about . It is good enough, how about that . The earnings season is good enough. It is good enough and you know, liz, heres the thing you have to remember for all the viewers out there, when you look around the world at any other asset there is no other place to put your money but here. Youre not going to china the i said this before. Youre not going to europe. You will not ion put them in bonds. The 10year is becoming so important because as the yields rise, folks stick around the dividend stocks. Byebye, i will go with the u. S. Government as flaky they may be because i get better yield in the 10year. Yes, liz, it is good enough. That is why stocks are higher. David david, there is another good thing i think is going on. For the first time in a long time good news for the economy is good news for the stock market. We had such an artificial market here, distort what the fed has been doing artificially keeping rates low that sometimes when we have bad Economic News which meant real people were out of real jobs, that was good for the stock market. I remember when American Express announced it was laying off 5,000 workers American Express stock went up. That is not good. For once, good news for the economy is good news for the market, right, david . Thats right. Thats where we want to get to where good news is good news again. Were headed in that direction or have been. With the talk about tapering, taper talk, but, you know we need to get Interest Rates normalized. The economy trading on fundamentals of the economy and the bond markets instead of being held artificially low by the fed. So rates normalize, as rates are determined by demand for capital that is good for the economy, good for the overall market and good news being good news again mean stocks trade run fundamentals. I want to bring up a name. It was not one of your names but a name came up in the last hour where we had a guest who likes rock wellautomation. That is midcap name. Near a 52week high of 93. It has done so well. Dont you think, david, that the best place for real yield is when you pick individual names you truly feel this is company that will do well versus hiding in corner, keeping your money dry powder waiting for the fed . I think that it is important that from a micro standpoint, not a stock we follow but yeah, youre looking for booed names, quality names be it in small, mid or large sector but we have seen stocks over the past few years trade more on the macro environment than on micro environment and as we move back to stocks trading more on fundamentals when it is less about the fed and more about the economy and how individual names are doing where it is not a rising tide lifts all boats. And for instance, we look at financials, the comment was made, are think, did they do better than they should, or, what i think is, theyre doing better than expected which is good. If theyre pulling the rest of the earnings season along with it so earnings are better than we expected thats a good thing. What it tells you want to be in financials. David which is why were showing right now the spdr for financials, etf Exchange Traded funds. No matter how you slice it, people out there are still afraid of individual stocks. They have seen so many scandals where people get in before the Retail Investor gets, they figure, no way i will beat the analysts on fast traders, supercomputers on individual stocks. I may as well go into a fund and thats why, by the way, all of your picks are for Exchange Traded funds orsiders. Certainly we have portfolios where were picking individual names. Like sectors like financials, regional banks, take biotech as an example, where it is highrisk, high reward scenario for all those individual names but the sector we like overall, hahm game no, maam last several years and human genome or by an etf or regional banks as a sector and make a play on that sector overall with a diversified portfolio. Liz well, let me go back to jared because a diversified portfolio, if held, for the past yearandahalf would definitely show some real gains. Unless youre heavily into gold which indeed has pulled back just a bit but looking forward where do you think the real opportunities are . You know, liz, i think there is something to be said first of all etfs. I think theyre great but you have to look inside of them. Liz of course. What you want to see here are stocks that maybe underperformed that are not in those superhot sectors. You know what, to be honest with you, look at growth versus what their value is. Look what the real company is making. Some stocks get caught in a halo effect. Theyre not really making that much money. They have high valuations, the stock is making more han what it earnings in a year look for companies that are cheaper. Here is company you might consider. Waste management. Theyre reporting earnings. If the economy is that good, people are consuming, guess what theyre doing, theyre throwing away. Companies like that maybe arent talked about on the headlines those you want to check up. Etfs david do you own that particular stock . I do not own waste management, i do not. David very good. David kudla, thank you very much. David, thanks very much for coming. We appreciate. Thank you. Liz back to school stock shopping, we know it is still the summer but a new study Shows Americans will spend less on back to School Shopping this year. Heres a question, will it be boom or bust for retailers and their stocks . Number one retail analyst on the street still has top plays in the sector. You need to hear her choices. David publicist and omnicom coming together to form the Worlds Largest advertising company. 34 billion market cap. Well talk to mdc partners. Competitors often Work Together with those theyre competitive with. They will talk about the impact on the industry of this huge merger and what it means for the firm. We want to hear from you. U. S. Companies are merging with foreign companies. Guess what theyre doing . Theyre moving from the u. S. To the for return Companies Country for the lower tax rates. Is this proof that our Corporate Tax rate, it is highest in the world, is too high . Log on to facebook. Com afterthebell. Are we losing jobs because of our Corporate Tax rates . We want to know what you think. [ indistinct shouting ] [ indistinct shouting ] [ male announcer ] time and sales data. Splitsecond stats. [ indistinct shouting ] its so close to the options floor. [ indistinct shouting, bell dinging. Youll bust your brain box. All onhinkorswim from td ameritrade. From td ameritrade. Pcentury link provides reliable yit Services Like multilayered Security Solution to keep your Information Safe secure. Century link. Your link with whats next. Now get the unmistakable thrill. And the incredible rush. Of the mercedesbenz youve always wanted. But you better get here fast. [ girl ] yay, daddys here. Here you go, honey. Thank you. [ male announcer because a good thing like this. Phew wont last forever. Mmm. [ male announcer ] see your authorized dealer for an incredible offer on the exhilarating c250 sport sedan. But hurry, offers end july 31st. Liz pharmacy benefits manager express scripts reporting Second Quarter results just a short time ago. We should head whack to nicole to get the numbers. Nicole . Express scripts beating on both the top and bottom lines. Lets break down these numbers for the latest quarter, secondquarter earnings per share coming in at 1. 12 versus estimates of 1. 10. That is good news there. Were also looking at the revenue and that too beat the street. 24. 6 billion, versus estimates of 25. 5 billion. The bid ask is is not too far where it closed, nicole, forgive me for interrupting but we do have herbalife. Dennis kneale, i see the stock popping afterhours. That scream you hear is coming from the short seller ackman because he bet wrong again. Earnings per share, huge beat, looks like on first glance, up to 1. 41 a share, far higher than 1. 11 a share wall street was looking for. Wall street was looking for 7 growth. It got 28 growth. Revenue a beat coming in at 1. 2 billion. Wall street was looking for only 11 growth, 1. 6 billion. The fullyear forecast the company lifting that forecast to higher than what wall street was expecting. Wall street expecting full year per share earnings of 4. 79. These guys raising it to 4. 83, to 4. 95. Almost 5 a share. That has the stock popping up 2 so far today. 30 of the shares in this company are sold short, betting that it will plunge. Someepeople such as ackman argued its a ponzi scheme or pyramid scheming but herbalife doing so well. David when you sell that much, have revenue, shows that you do have a product the market out there is buying. We should add to all the positives dennis just announced, the announcement they will become more aggressive repurchasing their shares. That sends the stock. Everything is going in favor of this stock going up right now. Liz looks like bill ackman awoke a sleeping tiger. Because as you and i discussed, weve said, herbalife has been around for decades and suddenly now, they have woken up and are fighting back, raising their 2013 view. Jared levy. What do you think . So interesting story herer ay scarce the heck out of you when you hear ponzi scheme. Herbalife, they have a multiple. Buying stock. You cant buy stock with fake money. They are beat earnings 15quarters in a row or something crazy. From multiple standpoint look good. Take a step back and look at the company itself. This short selling by the way will accelerate that rally. Well see a big up move tomorrow. Do you buy here . Probably wait a little bit for the sell, settle, rather. Still a viable company. David keep in mind as you were looking at the afterhours stock, we had a pop earlier of about 5 . It has come down a little bit afterhours, again this stock was trading at 24 a share back in december. That is when the shark attacks, the short attacks were there. They are sharks and they were in the water circling around this company. Imagine a pop from 24. Weve seen 12 month increases in share price in a lot of stock but december, as of december, this stock was trading at 24, liz. Liz yeah, it is unbelievable. Remember bill ackman, the billionaire financeer and hedge fund manager, his cost basis, he bought the stock 50 a share. He is hurting. Showing yesterday a 200 milliondollar loss on paper. No telling what is happening now. One person who is cheering carl icahn who took the other side of the trade. David 5 increase afterhours. That stock is trading 63. 25. Ended the day at 60. 50. Dennis you have one more nugget. Go ahead. One thing traders may have not noticed yet, while the company lift ad full year outlook beyond what wall street wanted, in the current quarter, the company reducing earnings outlook to below what wall street waned. Wall street is looking for 1. 16 a share. The company reducing its own outlook on Third Quarter earnings to 1. 09 to 1. 13 a share. The market looking past that to the full year estimate where they raised expectations from 4. 95, from wall streets expected 4. 79. Third quarter outlook could used some sales and pushed them up into the Second Quarter and you see a bit of a sales short fall down into the Third Quarter perhaps. Liz we have to bring in the shakes and try them. Thank you, Dennis Kneale. Jared, our thanks to you. We appreciate you being on. thanks, liz. David this was the big news as we woke up this morning. The french ad company publicis and american ad agesy omnicom announced their intention to merge into company and how will they pull it off and what will they mean for the business world. Liz we have md partnerss ceo. That is the 8th largest Advertising Holding Company in the world. Did sir martin call you . Were wondering who is next. Were 7th as a result of this. Stay around long enough you go up the chart. Look, this surprised everyone. Not that a consolidation was expected. It was expected. This combination of number two and numbehree was an unexpected combination. Its a great move for them and their shareholders. It is zero premium merger and they expect 500 million of synergies. That is 5 billion of economic value to be split between publicis shareholders around omnicom. Liz does it make you want to get in on merger action as well. Weve been a huge beneficiary of it. Our own stock was up 5 today. The entire industry actually has benefited. We see huge organic Growth Opportunity as a result of this because there will be client, you know, spillover and conflicts and, because clients dont really love big megamergers. Number two is, theres a great opportunity to acquire entrepreneurial creative talent. The third thing there will be very little competition for the m a were involved with. Now theyre just focused on consolidation of this huge behemoth. To put it in perspective their revenues are 35 billion. David their market cap would be 35 billion. Revenue is lower, 24 billion but their billing base is over 100 billion. You bring up a great point. A rising tide sometimes does lift all boats. Everybody could benefit from this the difficulty, lets talk for a moment from an ad guys perspective. Corporate cultures are always difficult to merge but when those corporations come from two literally different cultures, one in france, one in the United States, two countries that have very different tastes, very different styles the way they approach things, how difficult is it going to be to merge those Corporate Cultures . I dont think you can. Although i have this expression, all men are created equal, some are more equal than others, someone will become the dominant player in this merger. Weve always believed that all you should focus on is what is good for clients. None of the megamergers have ever benefited the clients in terms of better work, better impact and better Financial Performance of the work. Liz so are you saying a firm of your size is better for a big client that maybe they have right now that you can give them bert attention. Thats what weve won huge share of markets david she is getting a peeves your action . We have been the beneficiary. Weve grown 12 compounded in an industry thats grown two over last five years. So we have been very fortunate. The scale has never, scale has been the enemy of innovation and creativity. Liz why . Because it, jay had a great correction, how big can we get before we get bad . The reality is the most Innovative Technologies are developed by smaller more entrepreneurial firms. David let me stop you there because were looking now at some of the companies, some. Companies you deal with, some of the companies in the market. Getting back to that question of very different cultures, very different cultural approaches, are we at a point now because we are in a global economy, where thats less important than it used to be . Where people from different cultures can put out an ad campaign and it will appeal crossculturally . Well, keep in mind, this is merger really of holding companies, not necessarily the entities.