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tv   Closing Bell  CNBC  April 30, 2020 3:00pm-5:00pm EDT

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conversation about hot chocolate back here. >> they are so good. my son get them all the time it has been a wild month nasdaq up about 15%. dow and s&p up 10% even though we're going off stage here for april with a down day. i'm going to go get a frozen hot chocolate later today, kelly i swear. thanks for watching our breaking news coverage. it continues now into the last hour of the month with the close ing bell >> thank you rch i think it sounds delicious if a little hard to understand. a little illogical but none less tasty welcome to the closing bell. stocks firmly in the red on the last trading day of the month. let's have a look at what's drive iing the action millions more americans are out of work and seeking job benefits as data showed a collapse in consumer spending. the fed announced more spending to b even larger firm and despite strong spots, corporate earnings continue to paint a grim picture of the current
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quarter. we are down 1.4% on the s&p. >> we've got a big show coming your way we'll speak with the ceo of hologic which says its new coronavirus test could help increase the country's testing capacity and a massive afternoon of earnings. apple, amazon, gilead, visa and whirlpool. and an exclusive interviiew when i will pool's ceo. michael tracking the market on this final day of the month. courtney has a strategy update for macy's and julia is watching big moves for media stocks mike, start us off with the market down day, but big up month >> and a big five or six weeks since the market low take a look at the s&p this is a two-year this was a 35% drop on intraday
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basis. to yesterday's high, it was a 35% rally off that lower level so very sink niehaus in that way. i also point out that right around here, 3005, people are talking about how it's gained more than 60% of the overall point losses that has some significance it's kind of a may period. seasonals get weaker and yesterday was kind of a big headline day that drove a lot of buying as people thought perhaps it would feed higher prices so maybe this is a very logical place. that to me is somewhat significant. also takes us back the to 2018 type of peak levels in the summer there so that's why i think we're b finlding out some significant di jel digestion in the markets this goes back oto the early 2000s. the market tends to do best when economic data is going from
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really bad to less bad let's look at some really bad pivoting to less bad 2011, 2008, 2009 here is not so bad 2016, 2017 what i want to point out was what was going on in the markets. that usually is around a bottoming period and obviously perhaps we're getting an inflection higher here do want to stress it's not as if it's a moment in time then off races. look at that sloppiness. it's not as if the market has a clean bottom and goes higher and makes new highs but i think it's significant to keep in mind it's the inflection point, the trend change in the macro data that matters most one final thing. when jobless claims are high and falling is also when you have the best annualized returns for the market so clearly that's bet the is making even if we need to give back some of this rally. >> what sort of -- are we looking for into may and do you
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take seriously any kind of idioms the sell in may kind of thing? april has been unusual in that it's really been the infection rate, the news conferences from new york governor cuomo. some of the reopening announcements. not necessarily the economic data that has drif b ben the charge >> no, it hasn't been. in terms of the sell in may, i think there's been too many exepgss to that handy rule to really play it as an actual strategy, but it is smart to be mindful of the fact that seasonal factors tend to become less friendlily as you get through may. it's really a mountainer of okay, we've made this bet there's going to be a near term beginning of the reopening and we want to see business spending you're seeing a lot of companies say in these earnings they're going to cut capx. at some point, there might be a recognition moment where we say okay we knew things weren't going to fall apart entirely in the short-term maybe things got too oversold in the market, but we really need
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to see some recovery signals pfr we can take this much further. >> to the point of the economic data versus the markets, clearly we got u.s. gdp yesterday and euro zone today. it's basically comparable, give or take down 5% for q1 with economies shutting down in march as opposed to any earlier. it's another example here of where the performance in the u.s. seems to be shaking off the economic performance a little bit better euro stocks 50 is down 22% s&p down 10. even if you look at equal weight and you take account of those big tech stocks, you're still seeing significant u.s. outperformance despite similar economic data. >> true, i think the one thing i would point to is if you look at the policy response now versus two months ago, the mix, there's been a greater change with more accommodation in the u.s. therein there has been in europe or other places. so in other words, it's not just
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people were tightening and now they're loosening. it's just that the change has been more dramatic that perhaps has something to do with it along with the fact equity markets tend to be more spring loaded. >> thanks for that 54 minutes left of the session breaking news to interrupt the schedule with on auto sales. phil lebeau. >> wilf, ihs market, which tracks auto sales regionally and worldwide is now projecting that because of covid-19 and the impact on so many parts of the economies around the world, you are now going to see global auto sales this year fall 22% below 70 million vehicle last year, there were about 90 million sold worldwide in the u.s., 17 million were sold thisser year, it's expected to be closer to 12.5 million vehicles back to you. >> just looking at the press release. what was the number for the 2008, 2009 crisis, the peak
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then >> you're talking about worldwide? it was 63, 64 million. worldwide. in terms of sales for automobiles and this year, they're projecting it to come in roughly 69 million >> fine. just wondering about the percentage thank you for that shares of macy's under pressure as the company gives an investor update on the state of business amid the lockdown. courtney has the details >> so macy's is going to start a gradual store reopening with 68 on monday. 50 by may 11th then hopefully the whole fleet in six to eight weeks. i spoke with the ceo on the phone after he had a fire side chat with gordon and i asked him will macy's survive this and he said yes, i firmly believe we will survive we have formats from off price to luxury. gamble et of price points. i'm a 36-year veteran, wu i retain optimism for our whole in american retail.
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he also did tell me that macy's will emerge as a smaller company possibly with more store closures, lower than initially planned, sales of course and a smaller workforce. he said macy's is paying venders, but in 120 days instead of 30 and knows venders are really feeling it. i think about the pain i'm cause ing them every day and what my anchors have done for them i know my actions have a ripple effect across the supply chain and it's huge. april online sales were better than expected with strength and beauty, active wear and home he said macy's is working on private financing, possibly backed by inventory or unincumbered real estate and cash burn has been kept to a relative minimum back to you. >> not doing much to help the stock today down another 2.4%. courtney, thank you. we're also keeping an eye on social made area stocks and a big divergence between facebook
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and twitter. julia. >> that's right, sara. facebook shares about 4.5% after reporting that ad declines are stabilizing in april now the company is saying it's committed to investing in long-term growth to make itself a valuable plat forp it's also expanding with video calling and video rooms and live stream events and pushing to learn more from emerging markets and investment in india's geo platforms. twitter is down 9% right now after saying april advertising declines are similar to the 27% drop the company saw in march. twitter pulling guidance and twitter says it won't be able to fully tap into its faster user growth of this past quarter until new ad formats launch and live events return comcast shares are down about 4% after warning coronavirus will have a bigger impact in the second quarter as lockdowns drag on spending. comcast saying the company will
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lose about $500 million if theme parks emain closed until ijune on the flip side, comcast business is thriving adding 477,000 high speed internet customers in the quarter now comcast, facebook and twitter all have in common an eck poe sure to the ad market which is declining dramatically. how they fair now depends on how diversified they are and how well they can compete for those ad dollars with targeting as well as measurement. guys, back to you. >> and julia, wasn't this one of the reasons why facebook comes as a surprise on the better side because they had a will the of exposure to small and mid sized businesses for advertising so what's the actual verdict on where facebook sees the ad market now going >> one thing that's interesting and one key interest between facebook and twitter is twitter doesn't have any direct response ads now. this is a newer area for them. they're really trying to build it out and something they expect
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to be a bigger deal. but facebook has a huge amount of direct response advertising now this is the part of the ad market that has stayed very strong because it's very measurable people click through to buy. this is the kind of thing that e commerce companies are really turning to now so facebook seems more resilient and direct response where as brand advertising has really fallen off a cliff >> thanks so much for that the other point i was going to bring up on comcast, it was up a couple of percent before the calls began and now it's down 4% and the moment when they were talking about subscribers for things like sports and talk ed i te tail about that for sky in the u.k. and then in europe from sports is a huge part of it. they've allowed people just to freeze the sports part of their package in europe so it's a halfway house between cutting the cord and maintaining it and clearly, analysts were worry ie
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about what the implications of that were. i bring it up because we've all ignored espn for the last year or so for disney, but when it comes to disney, it will be interesting to that part of the business has been hit, which the comcast stock move certainly implies that's what investors are taking away as a big risk point going forward for comcast. whether we're talking in the u.s. or in europe. >> yeah, i would agree that essentially when ever the focus goes on the paid tv trends, when you get tend to have weakness in the story line i also think that what we're seeing in general right now is whatever the long-term secular trends were in various parts of media and technology when we're in this crisis, it seem like the perception is they're getting accelerated and only going to kind of duoto goh to a greater length so that would fit in with the idea that that's a worry point for investors. >> comcast down. >> so nascar's coming back >> it is >> just got word that nascar's coming back may 17th in charlotte >> you always break the nascar news just so plugged in
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>> such a fan. >> and the new covid-19 test that could dramatically increase capacity in the u.s. the company's ceo will join us next one of them.shouldn't be that's why we're offering contactless delivery and set-up on all devices. and for those experiencing financial hardship due to this crisis, we'll work with you to keep your service up and running. hi! because at at&t, we're always committed to keeping you connected. a lot goes through your mind. with fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations. that's the clarity you get with fidelity wealth management.
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just under 25 minutes left to go. stocks are lower across the r board on this final trading day in april shaping up to be the strongest month for stocks since 1987. we've got all 11 sectors down though today financials and materials are the worst performers energy is the biggest winner on the month so far 29% though still the bigs loser on the year. some individual market movers, zoom feeling the heat after walking back claims it had 300 million daily active users the company reporting it saw a 50% surge but later updated to say it had 300 million daily meeting participants the difference is that meeting r participants can be count ed mor than once. and shares of the carlyle group falling today. the firm reporting a $1.2 billion investment loss also
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withdrawing forecasts citing fallout from the coronavirus pandemic stock down almost 11%. >> they had a great run last year unsurprising there's going to be some write downs at this time and weighing up those underlying exposures, whether they've got high exposure to energy and hotels and the like. we'll e see where it shakes out u. though cash rich at the moment having raised a lot of funds coming into this so we'll see if they find opportunities. helologic announce iing they ha second covid test which could increase testing in the united states the company will start distributing the test next week and expects to receive the fda's emergency approval joining us to tell us more is the ceo. this is your newer testing machine. how significant is it in terms of accuracy of the test and
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speed of which you can process them >> i think that's really the big advantage that we're bringing and i think as you know from knowing the company over the years, we've been p the world leader in hpv testing and most sexually transmitted infection tests p and while we developed a test that kind of mirrored our flu test, we turned to the high volume opportunity we had. i'm going to try to dimensionalize this as simply as i can. it's all about getting a lot of results quickly to the patients where and when they need it and the imagimagic in our test and n millions o tests a month normally is this simple and i hope you can see this. after somebody gets swabs, this swab b goes right into the tube. the swab gets broken off this tube gets sealed. and for all the video that you always see about people then pie petting in the laps and trying to take stuff out. what happens with this tube is it never has to be touched again because our transport medium is
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also what is used on the tube. this then effectively goes to the lab. gets put on to a rack and that rack is put right on to the panther machine that you were hoeing earlier the panther machine is a high volume, high throughput instrument then if you'll pardon my little attempt here, the magic is where dr. birx and the whole team is so excited, this is where the panthers are. over 1,000 in all 50 states. so instead of what's been happening where somebody gets swab bed at a drive through thing, it goes into a bag, it's going to get in a car, go on a plane, get back and the whole di lays in testing, this can come right to the hospital. example. north wall hospital. they want to test their employees at night they can swab them, run them overnight and know if they can show up in the morning and be
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ready to go to work or other things like that then literally we're dwoigoing e release three tests next week. there are a few companies on the planet that can do that scale. we've committed to at least a million a week every week for the rest of thor year. >> you certainly came prepared, steve, thanks for the demo what about that question of accuracy we've been hearing more and more about false positives and negatives. have youses been validated >> yes what we have is our pcr test, our first one, was validated then this one as well. the it's a different process than the typical fda you know rigors because they are allowing emergency use. but because we have so much experience using this is a messer rna technology. that we have so much experience in that has very high levels of sensitivity and specificity in the label itself what you see is remarkably high levels ie, labeling the test detected every false positive or
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basically no false president obama ties and got all of the negatives. so you know, that's, that's what the high throughput and by eliminating all the manual variation that happens in so many tests, this is highly automated. it brings a remarkable level of efficiency and accuracy both sensitivity and specificity, which are the key attributes >> so steve, help us with some of the math here, how long away are we from being in a position in the u.s. where everybody that needs to have been tested can get a test fairly easily >> you know, not sure i can answer that because i don't know what the true answer is as to how many tests per day i think where we really need, i think you know there are different models and everything else, but can we get to a point where we're conducting millions of tests a week in this country which should therefore and be able to sample them appropriately.
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you know when you look, obviously where you guys are in new york, new jersey area, there's still a tremendous need to get more people tested. in many states now, we're really testing the current results are very low single digits of percentages of people being testeded so i think what we've got to be able to do is monitor the hot spots. everything else and whether that ends up being call it a million tests a day, 750,000 tests a day to you know several million, not sure where that will evolve but i think you know we're working very closely with dr. birx and their team to really help answer those questions. >> so steve, you mentioned you do another, a number of other diagnostic testing pap smear, mammograms. what's happening with that business and are you concerned that people are going to be suffering in this country and we could have some real health problems as people who need those tests aren't able to access them or aren't going out
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to get them? >> i love you asking that question i think it's one of f the very real unintended consequences honestly we've got to fight the pandemic and the concern right now but when you think about diagnostics, it's all b about finding things early mammograms as frankly, probably on the order of 80 or 90% of people put off their mammograms this month detecting canner sces about detegting things early i do worry, we have for example nothing in cardiology. people who have cardiac events, everything else because they have not been going into the hospitals, so i think the best we can do is help get people back the irony and when you look at it on a national was is by the way, i think most of the hospital system has never been more empty it's incredibly burdened in some areas and incredibly empty in other areas so i think the more
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we get balance back and allow people to see people safely go back in, so we can avoid all the other unintended consequences that won't show up today but are showing up down the road >> yeah, big story steve, thanks for joining us >> thanks. thank you both >> 37 minutes left of trading. take a look at stocks right now. the dow's down by about 1% 248. we've actually made up some lost ground in the last few moments s&p down 25 points less than 1% now let's see what happens in the next half hour coming up, the man who helped oversee the financial crisis t.a.r.p. program is speaking out now about the issues surrounding the government's small business stimulus plan. he's going to tell us who he ys is to blame
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following backlash over some large firms that receive e ed funding in the first round >> some in the banking community are asking why this is necessary and allowed. here the administration is is being accused of tipping the scales the sba and treasury processing time would enhance the performance for all and insure access for smaller lenders and their customers. did smaller ones need help data showed the vast majority approved so r tar has beenfar hn by smaller lenders more than 80% were for lenders under 50%. for clarification on why this was done beyond just easing up the e tran system. banking sources tell us we're
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seeing some in the log jam but accusing them to playing favorites and it's safe to say we know this client is more than $90 billion already spoken for that's about a third of this program's funding. businesses will certainly want answers. >> the key thing it cops back to o is more demand than supply there's been different issues that we talked about so much as to how that's manifested, but again, this shows that in balance demand and supply and feels like we're going to get up to the current limit soon and if we have to have another increase in the overall pool of money available it only kind of goes back to the beginning to highlight what the key issue here that is limiting this distribution of funds. >> not enough cash to go around. the government can say it's the sba's falult. the banks can say congress didn't allocate enough money that not enough people worked
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quickly enough, but businesses that are small bank with banks of all different sizes and some here are asking why this was necessary. and if it perhaps kind of tipped the scale in favor of certain businesses that are working with certain types of lenders >> kate, thank you we're going to continue the discussions because companies like shake shack, auto nation and even the los angeles lakers are returning those loans they received from the program after coming under public fire treasury secretary mnuchin weighing in on b cnbc. take a listen. >> it is unfortunate that there's a small number of companies that have created a lot of publicity that lootook loans. i think it was inappropriate for most of these companies to take the loans. the it was clear there was a certification. we don't think they should have ever been allowed to >> joining us now, neil barofsky for the troubled asset relief
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program, t.a.r.p., during the financial crisis, i'm sure you're having a lot of da shah view some businesses blame the banks. who do you blame for some of the problems we're seeing here in this package >> doesn't seem like there's a lot of very good, pure and clean players here, but i have to say that you have to go back to the design of the program itself and view shake shack as an example everything about this bill when it was passed through congress and the rules that set treasury up the treasury and sba set up, if i was at shake shack, i would think i'm the intended recipient of this. congress went out of its way to carve out businesses that have more than 500 employees but are restaurants with chain restaurants. they wanted the money to go to chain restaurants. nothing in treasury's rules that would have prevented it. they participated because they qualify ied. then there's a tremendous
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political backlash the blame really goes in the design of o the program itself more than any other individual business not with standing the secretary's statement earlier. >> with that in mind, should those types of companies even feel the pressure to give the money back i get that shake shack is a consumer facing business the it has the extra added factor to weigh up as to whether it damages their brand long-term, what the you were a company the metrics that they were so upset b about. you met the terms? you don't know how difficult this is going to be. >> i think there's two factors there's real harm that could happen to your business by appearing piggish. giving the fact there's not enough to go around. that means a company that
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doesn't quote unquote need the money is literally taking it out of the pocket after another business that does if you're a company that really doesn't need the money to maintain your payroll given the current political environment and xwif given the fact there wasn't enough to go around a lot of pressure that could impact the brand but for a company that's otherwise going to be firing all these people and can't survive, the it's going to have to make that decision as to whether the public relation kit is worth the survival of its business >> so, t.a.r.p., which you oversaw, was controversial and still remains so about whether it was fair, who got bailed out, whether the task payer got a bad or good deal do you think any of those kind of lessons were heeded this time around from the administration, the treasury and lawmakers in dra draft thg? >> this is the exact repeat made in t.a.r.p. t.a.r.
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back then, this money was given to the banks with the hope they were going to use it to restore banks and help struggling homeowners but when the money went out, there were no incentives that they used it for these purposes and surprise, they didn't. they used it -- as if any company would in a capitalist society. and that's just what's happening with this program. the money was given to the banks to do the lending. but not with any requirements or incentives that it favor smaller businesses or that it apply a level playing field. in fact, incentives were for it to do the opposite so you're seeing the exact same thing happening again and it was pretty obvious when the original program rules came out, this was what's going to happen and with more hundreds of hundreds of billions of dollars more to come in other programs, you just hope that treasury and the federal reserve stop repeating this mistake. if you're going to rely on bapgs, you have to give them clear instructions requirements or incentives if you want them
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to carry out your policy goals >> but neil, qualify that for me how can you be sure that they purposefully allocated these funds? all the statistics and big banks have released to us in the last couple of days shows that the vast majority has gone to smaller customers and you know, i'd add to that the clearly, there's some headline grabbing bigger customers, but could you have expected the bank to turn away shake shack and say sorry, shake shack, yes, you qualify for all of the terms of this, but we've decided to stay no to you. the bank doesn't really have that position, that nort to do that >> and i'm not criticizing the banks. first of all, i think some 45% of the program funds went to the top 4% of applicants so i think there's data to back up those criticisms but from the bank's perspective,
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it is following instructions and those were consistent with the general business sense where you take care of your biggest and best customers first they also made more money per loan and there was just no other incentives to counter those things, so i don't blame the bank for giving the loan to shake shack that otherwise and still qualified for the program. the problem is that if you, if the government wants banks to kirry out its policy, it has to counter those incentives or provide itself own otherwise, it's not going to happen ultimate lig, it's the government's fault >> the fee though in percentage terms is higher for a smaller loan then, but in dollar terms, clearly that depends on how many you make, but the percentage terms, higher r for a smaller loan sorry, sara. >> sorry >> no. just going to ask -- go ahead.
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>> that's true but when you talk about the cost per loan, it cost kind of the same to make all these loans because of the underwriting standards so if you could make $200,000 doing a $10 million loan or $5,000 on a $100,000 loan, which are you going to do? that's what i meant by the v structure. >> i was just going say that the treasury might respond to you by say iing they did impose string attach third-degree time, but on the recipients of the loans. for instance, that you can't layoff your workers and you have to keep them on payroll if you want those loans to be forgiven and that ultimately, that will be how this program is judged. by how many people and how many small businesses can remain working employed when these economies reopen on that front, it feels like the jury's still out froms. >> i think that's true and i think one of the interest ing things is that a shake shack is kind of a very efficient way of achieving that goal because if you get 5,000 employees and
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they use that money to keep them on the payroll, that's going to help accomplish that goal. and so yeah, i agree at the end of the day, the program will be judged on how many people are kept at work, but when ever it comes to government programs, bailout and stimulus, it over and over again, it's the big companies and the most well connected at benefit and the smaller guys that suffer. there's larger consequences. there's anger that generated the tea party and occupied and we've got another presidential election coming up and this sort of repeated inequity in these systems, toll just goes beyond the dollars and cents but really impact where we are as a country. >> do you see the federal reserve's main street lending program going that route, too? >> there's a lot of guidance that came out today and i think that program may have been misnamed i just, the first look at it, some of these terms, it doesn't seem that your typical main street businesses as we think of that term are going to be qualified. if they do, whether the banks
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once again relying on the banks to administer the program will put those companies at the top of the line. it looks like a good program for a larger more established businesses than it does for this sort of small mom and pop. >> well stay close, neil barofsky, we're going to talk about this a lot more in the coming weeks thank you for joining us >> thank you the counterdown is on to another huge afternoon of earnings results ahead from am l, amazon k gilead, whirlpool and more plus, exclusive interview with whirlpool's ceo and analysis here's a check on bonds. mixed action today ten-year currently yielding 0.63%. so rising again having dipped earlier below the 0.6 level. back in a couple of minutes.
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it's time for a coronavirus news update. hi, sue. >> hello, everyone hooefrs what's happening at this hour georgia's governor is relaxing that state's shelter in place order. starting tomorrow, all businesses will be allowed to reopen but with some restrictions vice president pence was wearing a face covering today when he toured an indiana gm plant making masks he received a lot of criticism for going maskless during a mayo clinic visit yesterday his wife says he was not aware of the mayo clinic's policy until after he left.
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disney is selling nonmedical cloth face coverings with up to $1 million going to charity. ♪ happy birthday to you >> and a happy birthday song for that gentleman captain tom moore from his family and also from the royal opera choir as the u.k. vet turns 100 and there's boris johnson who honored him in a video message for helping to raise millions for the national health service and then world war ii era planes saluted him from the sky congratulations to him as always, more coronavirus coverage you can head to cnbc.com sara, back to you. >> colonel tom moore now >> famous guy in the u.k >> he is and actually pretty famous around the world he raised millions of dollars all on his own it's wonderful. >> sue, thank you. see you next hour. we've got just under 20 minutes before the close iing bell here's where we stand heading into the close of the month.
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dow's down 348 points. apple is a notable exception we'll find out how the company is weathering the storm. earnings coming a after the bell as well as many more names including amazon, which was higher into that report. we'll be right back.
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shares of tesla turning lower on the back of earnings, but it's comments from elon musk on the call that are drawing the most attention today phil >> roller coaster day. earlier today, tesla topped $800 for the first time since february and the stock moved higher because the bold narrative is still in place.
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surprise q1 profit no change in delivery guidance many people thought it might be lower. there's the fact that the covid-19 virus, it could impact q2 operational profits here's elon musk talking about in a very colorful fashion last night. >> what the [ bleep ] excuse me. operate system is outrage. so but of course right now, not just tesla of companies and while tesla will weather is storm, there are many small companies that will not. >> talking about shelter in place orders which he believes are quote unquote fascist. again, delivery guidance hasn't changed. still expect to deliver at least 500,000 vehicles this year >> thanks very much. for that colorful earnings call. up next, uninterrupted coverage of the final minutes of trade when we take you inside the market zone. ortant than ever. at&t is committed to keeping you connected.
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close. mike is here to baek down these crucial moments along with stephanie link who joins us today. >> stocks are lower now to close out the month but a pair of earnings report could reset the narrative in a few moments let's start with apple back in february, the tech giant warned it doesn't expect to meet its revenue guidance of 63 to $67 billion. apple citing production delays and week demand in china due to the coronavirus. the stock is higher going in it has been resilient compared to the overall market. what's the set up and what sort of numbers will you be looking for? >> it's roughly regained as much of its losses as the overall market it sort of outperformed and you have the this push pull between an opaque picture. because the guidance, not really sure what consumer trends like like anywhere in the world on the other hand, there's a real premium on those sheets and the companies that have the where with all to do a lot in a
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tough time it's not that the stock got cheap in particular, but it just got oversold and i'm not even sure this quarter's results are the key. it's the capital return program as well as the outlook into the rest of this year. >> stephanie, when you r consider this stock is essentially flat year to date and therefore that puts it into an elite club of outperformers this year, is its reason to be in that club as clear cut as an amazon or say a facebook where engagement is such a big factor? >> well they've done a really good job at diversifying the company into wearables and service fs and that sort of thing so they're not just a one trick pony like they used to be. that's why you saw the multiple go from 11 times to 23 times i think it's sort of interesting there are only 64% of the sale side that has buys on the stock so it will be interesting o to see if there will be changes are they up and running 100% or
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not? what's going on with china because i'm always looking at china. they're a couple of months ahead of us in term of a recovery and is online sales off setting the retail sales at the stares is that is smrks those are the things i'm watching. also 100 billion in net cash what are they going to do with it hopefully, we'll get some answers this afternoon >> you think they're going to actually offer buyback in dividend program in this environment where so many other companies are not and the word is caution, hunker down, we're in the middle of a pandemic and economic crisis? i get they have 100 billion in cash, but you think they're really to go there >> they usually do this quarter. so maybe this quarter they don't because they're more sensitive to this situation but my point is they have 100 billion and that they can play with. right? they have that flexibility
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they're in a position of strength not weakness. we've talked about this. there are industries that are weaker that shouldn't be buying back their stock and there are those companies that have dominant market share that are blue chip, good management teams, proven winners that have every right to buy back stock and increase the dividend. they may not do it today, but they will at some point. >> i would add one quick thing tim cook says he thinks it will be a v recovery. if he his that at all, then this is not the environment where they have to be careful about 100 billion in net cash. >> he was quoted by the president as saying that trump's comments we'll see if he backs that up. >> lots more to discuss. apple's going to be a big story this evening breaking news in the retail world. hey, court >> sources tell cnbc.com that j. crew could be preparing to file for bankruptcy as soon as this weekend. sources tell cnbc.com that the company is is looking to secure
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about 400 milli$400 million in to keep the company running in bankruptcy j. crew is one of those names that have been on many warning lists just flashing signs that this has been a possibility for some time. well before the coronavirus outbreak this company has struggled with its sales. it does have a mountain of debt that it needs to pay off as well, but it looks like it is possible those warning signs are actually going to come true in some way this weekend according to sources telling cnbc.com again that j. crew is preparing to file for brankruptcy. back over to you >> yeah, it's a huge headline but as you said, you know, the clock has been ticking for j. crew, niemann marcus finds itself on this list. jc penney. it's a real story of the have and have notes in retail the question is going to be with so much pain out there and traffic coming to a standstill
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and no revenues coming in for anyone in brick and mortar, what other collateral damages is going to be? i think that's why your report on macy's was so interesting and yef say iing they're going to b able to survive this because there are some retailers that are in the middle. they weren't doing absolutely terrible like j. crew going into this crisis, but are still suffering. >> absolutely. and i don't think we know the extent of this suffering and on the flip side, we also then don't know the extent of the opportunity. because if you are a retailer that survives or you hold on to the stores in an area where other stores have gone, perhaps then you pick up that white space. you pick up the market share that was lost. now a number of these companies we're talking about potentially filing for bankruptcy are lo looking at restructurings. they're not talking about liquidation, at least not right now, which usually means they want to continue their operations though they often have to close some amount of stores to be b able to do so but once they do file for br
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bankruptcy, it starts that clock ticking. they get 180 days to go forward with that restructuring in the court process so there have been a number of experts that say a lot of these retailers are working on deals on what they can behind the scenes before they go through the filing when that clock starts ticking. >> thanks so much for that we should mention broader markets improving. the dow is only down 240 points. so less than a percent of declines for all three of the indices. amazon set to report earnings. >> key question, will amazon deliver? shares have surge d about 30% year to date the street is certainly expegting revenue to surge amid the pandemic what could spoil the party is filing costs amazon spent billions on one day delivery last year now delivery times are often weeks away so how much is it spending on further expanding
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its xcapps pi and bringing in equipment to monitor people's hemt niz cal stores will be in focus. is this the quarter that whole foods finally breaks out back to you. >> thanks for that stephanie, are you optimistic? clearly, we all understand that a lot of a.m. samazon's sectors benefit from current trends. that already priced? >> i think so. i've trimming my position. and these guys are notorious for spending aggressively and they should obviously to keep up with demand we love that they're highing. they're doing all the right things but i feel like who doesn't know this already. by the way, 91% of the sell side has buys on this one i expect good numbers, i just don't know if the market's going to react as positively as people expect >> sort of adding insult to energy during an amazon preview, the fact they're killing it after the j. crew bankruptcy
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mike, what do you see in the market internals here going into the close of the month sfwl still soft internally little bit of a giveback day if you look at almost two to 1 negative to positive on the new york stock exchange. also, it's a reversal day from what we've seen in rekent days in terms of small cap over large. you see small caps today compared to the top five giving back some of the advantage they built up over a couple of days the equal weighteded s&p is down 2.7% even though the overall s&p is down less than half that much now then the volatility indeck has rebuilt a little bit o pr m premium in there as we perhaps get to a little bit of a pause in this rally in a minor pullback so you see it back up toward the mid 30s >> so mike as we look at tonight's earnings, what are the big cap tech stocks done for the broader market today and the day before as they beat? it's only really been p stock specific performance as opposed to lifting the entire market >> today, you can look a at
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facebook up, microsoft up a little bit as support iing the overall s&p relative to the average stock out there. so in general, they've been add ty, but not really been the whole story of this last little spurt of the rally to the highs because there was a little bit of a mean reversion in those laggard stocks and the it's been pretty noisy though in that relationship >> one minute left of the session. s&p 500 down 0.8%. dow down just shy of 1% or 250 points below the session for the dow is down 450 points or so nasdaq outperforms down just a quarter of 1% and russell underperforms. down 3.6%, but so far week to date, the russell 2000 remains the best performer two sectors just climbing into positive territory in the last 15 to 20 minutes consumer discretionary and services the other nine sectors in the red. some of those sectors that have
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been performed best coming into the day are suffering the most today. for the month as a whole, we are looking at about a 13% gain for s&p 500. up 2.7% so far this week but closing down 0.9% today. the dow just down more than 1% down 1.2% at the close the nasdaq outperforming today, down just a third of one percent. >> and that's a wrap on the best month for the s&p 500 since 1987 welcome back ifyou are just joining us take a look at how we finished up the day on wall street. lower across the board though well off session lows. dow was down more than 400 we were bouncing around the close. finished lower by b about 302 points s&p 500, saw two groups go positive toward the end. consumer discretionary and consumer, communications
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services the index still closing down 1%. the nasdaq doing better. down only a quarter of 1%. thanks in part to facebook climbing after earnings. nasdaq's the winner on the month. up 15% for april and the russell 2000 index of small caps which had been outperforming by the week, lower by 3.7% so taking a step back from the trend we've seen all week. get set for a wild earnings ride apple, amazon, gilead, amgen all set to report earnings in a few minutes. we'll have instant analysis of the numbers for you. plus we're awaiting numbers from visa, united, mgm resorts and whirlpool and we'll ask the ceo how coronavirus has impacted his business as many americans buy freezers to store food during the lockdown joining us to talk about the market, stephanie link is here and so is mike to help put this all in
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perspective. what we saw today, what we saw in the month and where we are so r far r for the year >> so yesterday seemed to be b the culmination of this rally for april. to some degree you had them feasting on good news obviously had a good drug trial. a dovish fed, all these things good good big tech earnings that people really did make a grab for the market we're at an obvious level. somewhat are stretched in the short-term backing off today. i don't think it changes the story for a month which is a panicked low people had to chase it higher. now it's about whether earnings give you any hope. that's the i think the time moment we're no right now. >> just going to hear the amazon numbers. >> stephanie link. >> so, coming out with a decent beat on the revenue line and a reasonable miss on the bottom line so revenue, 75.5 billion the forecast was 373.6 billion i term of the bottom line, eps of
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$5.01. the forecast was for 6.25. north america revenue just ahead of expectations. 46.1 billion we've got international coming in at 19.1 billion that was in line so aws, perhaps a little light given that the other one was slightly ahead we'll come back with that in a moment, but either way, beat on the top line slight miss on the bottom line. stock down about 2.6% as a result we talked about the huge run up of course it had had coming into this sxwl yeazbl yeah, it was up 12% since the peak of february 19th. so going in a different drek the cost of delivering on that demand for amazon. a little bit less discretionary type goods free cash flow down on a 12-month basis in here it seems as though they didn't fully capitalize it on this new
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business i think the delivery cost is going to be perhaps some issue >> there's so much text in this release it's going to take 25 minutes to go through it but i'll just pick out one line on that point, mike. about profits. here's a quote from jeff bezos if you're a shareholder in amazon, you may want to take a seat because we're not thinking small. under normal circumstance in this coming q2 we'd expect to make some 4 billion r or more. we're going to spend the entirety of that 4 billion basically talking about making the investments they need to get their business up to speed and they say when it comes to aws, groceries, retail on amazon, they're being tested when it comes to just delivering in so much demand because of the current crisis so there you go. they're back in spending mode. >> no doubt about it and you know, i think you'd be surprised if it were other wooids, but the way it's articulated there brings it home >> i just mentioned the aws
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numbers. 10.2 billion the forecast was 10.3 billion. there's still the big lead er i this area in terms of year over year growth. that's 33% growth for that number so you can't really argue with it i guess. microsoft's beat relative to expectation was a bit stronger on that line in terms of cloud but none the less, stephanie, 10.2 billion growing 30% plus fper year, profitable business. something still to celebrate and offers diversity of their earnings at this time. i guess again it comes back to the point of how much was priced in and what this is going to mean to the bottom line. all this extra spending going forward. it's down 6% as we speak in afterhours trade >> i think the cloud business very impressive but nothing like what microsoft printed yesterday and i tweeted that out yesterday because i think that the expectations are so high, they're coming from a much bigger base. so i get that, but this needs to be a perfect quarter
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a beat across the board and see the guidance, seems like it's better so we'll have to go through that, but every single line item you mentioned, north america, international, aws. all just kind of came in line. and you can't come in line when you're up 31%. expenses are high, but the mix is really hurting them as they sell more grocery and essentials also first party versus third party. these things in addition to them spending are why they thought the expectations were too rich into the print this is not a zdisaster guy, we want them to invest. >> we also getting q2 guides, that guide reasonable compared to what a will the of other companies have been doing in terms of forward guidance, which is nothing let's get to diedra who has more standouts for us
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>> just looking through the different productlines arnlgs ws at 30% growth year over year. remember that's lower than what google showed us just earlier this week. i also want to point out physical store sales that was up 8% year over year coming in a little bit above expectations and that's mostly made up of whole foods there could be some concern though perhaps you investors want to just see a little bit more of a bump when amazon goes into new sectors, you usually see much higher growth in that. it's been muddling along it was negative over the last two quarters now this is up to 8% so perhaps encouraging. also just want to identify the other revenue line and this consists mostly of amazon's relatively new advertising business that's up 44% year over year hire on a sequential basis so that's interesting while it makes up a small percentage of total revenue, amazon has been moving aggressively into the
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advertising space and as we know as facebook and google look at declining ad sales, it seems to be consistent here with amazon, but i think the point guys what we talked about earlier is thes costs are rising we heard from bezos in this letter saying that their 4 billion they were allocating is going to be spent on covid-19 measures and remember, this company still is taking weeks now to deliver goods so they have to also think b about their logistics in getting that up to snuff for as long as this goes on >> i guess that's what he means when he says you may want to take seat because we're not thinking small they also go to great length lengths, a lot of points in here, about how they are protecting their employees and their customers and how they're investing in ppe to make sure they're safe. there's clearly been some bad headlines and publicity for amazon and warehouse workers complaining about some of the conditions not sure it's had much of an impact on the stock but how has
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it impacted the company? >> right i'm so glad you asked this question who can forget a few weeks ago bezos tweeted a picture of him walking through a warehouse getting his temperature checked. walking into whole foods so they are clearly trying to promote the safety because a lot of labor unrest going on at amazon that existed before the covid-19 crisis but we've really seen it accelerate over the last few weeks and months and tomorrow actually on may 1st, there's a general strike we've seen these little strikes going on, but tomorrow is supposed to be a much larger one. we'll see if that impacts the business amazon has made a point to say it hasn't impacted operation or demand whatsoever but you have to wonderf the longer this goes on if there will be some impact and also remember b even if it's not impacting the business, lawmakers are certainly taking note you've got senators like bernie sanders and joe biden putting their support for workers in this case >> just quickly --
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>> they've got a lot of line items there to respond to them >> before the -- thanks so much. before we go on to the next couple of earnings, whatever the valuation, it is extraordinary in this environment to be able to report revenue up 26% year over year. and even if you go to the point that the lockdown only really began late in the quarter, they're able to forecast that revenue would increase again for the quarter going ahead with 175 billion this quarter the guide is 75 to 81 billion for the next quarter we'll be talking a similar percentage year over year, top line growth for q2 when the lockdown has been hitting it which is just unbelievable . >> think b about how many amazon orders our family has been making a lot. it's the kind of range they're giving for the second quarter.
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you see the spending in the guide they're giving where operating income or loss is expected to be -- comparing it to 3 billion last year so that's where the crisis is eating into cost as they try to right side the businesses to get them ready for this increased growth and also invest in safety around their employees and around their customers. we have more ayeshaings to get to though and especially one that a lot of people are paying attention to, which is gilead. also amgen is out. meg has those results. >> let's start with gilead it's a beat for the first quarter and the xacompany is giving clarity into how much they're spending to manufacture spending of remdesivir, the drug for covid-19 that yesterday showed positive results in an nih study. for the first quarter, adjusted eps coming in at 1.68 and revenue was $5.55 billion versus $5.54 billion. company said it was helped by
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$200 million in sales of increased customer buying patterns and patient prescriptiontrends due to the pandemic, particularly in the united states. that's something we've been hearing from a lot of drug companies. in terms of the big hiv franchise coming in at $4.1 billion, hepatitis c beating $729 million company holding off on updating its 2020 guidance. saying it will give it in the second quarter let's dig into remdesivir. they say they've spent $50 million in research and development expenses related to remdesivir in terms of the scale up for the manufacturing and the clinical trial costs for that drug. saying here in the release that the total investments in that drug primarily to expand production could be material but the amount, time lg an accounting as well as a potential to recoup gilead's at risk investments in the future are depending on regulatory
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outcomes they say we're authorized by authorities, they'll focus on making it affordable to governments and parents around the world. we'll listen closely to this on their call this afternoon and we have the ceo joining us tomorrow morning on squawk box and we'll be talking with him about all of this want to talk b about amgen's results. it was a beat for that company adjusted eps comeing in at $4 and they are reaffirming their 2020 guidance and perhaps that's why the stock is up there more than 2%. back to you. >> meg, thank you. stephanie, what do you do with a stock like gilead that's moved so much around sentiment and clinical studies that have come out around remdesivir? >> well, i mean it's hard to
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sell into all this momentum but the stock is up a lot. i mean it's up 26% year to date and that's a lot we don't know what the pricing is going to be for this drug and i think that is going to be the key issue on that conference call but i look at the quarter and the it's kind of disappointing hiv is their franchise you need to have them do well and for them to come in a little light, this makes m and a that much more important. they've got a ton of cash on their balance sheet. they can make an acquisition or two but they have to do it because their base business isn't great. >> this is shaping up to be a theme that covid-19 is causing fewer patients to access their normal treatments. whether it's for hiv we heard it from hologic 90% of mammograms canceled last night. health care spending is down sharply so it's hurting our economy and companies and people a theme we're ging to continue to cover but more earnings.
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visa is out. dom. >> yes, ma'am, visa shares down about a half a percent after spiking initially on earnings coming out about 632,000 shares of afterhours volume so far the number, it comes in at 1 clnt 39 per share adjusted there are some questions about whether or not that's comparable to the average analyst estimates out there. what we know is revenues came in at $5.85 billion that was better than the $5.75 angelst ists were look iing for. ublg add visa to the list of companies who have withdrawn their 2020 year of earnings because of the uncertainty because of the virus they said they didn't see a significant impact to some of their business trends until the latter part of march in this past quarter but again, no forecast offered they've yanked that one. revenues better than estimates the profits may be not comparable so far. those shares off csignificantly from where they were when they first spiked after this earnings report came out. back oaf to you. >> thanks so much for that another one out. whirlpool earnings
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let's have a look. we've got decent beat on the bottom line. 4.33 billion estimate was 4.3 billion the eps at 282 the forecast was for 248 for them and it looks like the beat there is coming from slightly better than expegted raw material costs so perhaps one of the few areas out there in the economy benefitting from commodity price declines in terms of regional breakdown, u.s. which is the biggest part of the business was in line on the revenue line. amir and asia, slight miss slight beat. and the guidance for 2020 they've kept they've lowered it though. revenue guide for the full year at 13 to 18% decline the estimate had been for about a 10% decline so able to maintain guidance of some sort albeit negative. we'll break down those numbers in a few minutes time when we're joined by whirlpool's ceo exclusively. don't want to miss that one.
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>> and we say thank you to stephanie link for being with us during this madness. we are just minutes away still from apple's big earnings report find out how the coronavirus ihn as we are released we are back in just 90 seconds
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♪ ♪ ♪ ♪ ♪ big earnings afternoon
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a.m. sop shares moving lower after reporting earnings moments ago. joining us to wraek down the number, ed lee from "the new york times" and cara swisher also joining us is michael levine, senior research analyst at pivotal verge good afternoon to you. clearly, this was a top line beat they're seeing strong sales growth bottom line miss as it's costing a lot to serve these customers and to do it safely. what stood out to you? >> remember back in the day when amazon used to miss on the bottom line all the time and no one cared then we got used to them making prochts afits i think the thing that stands out is after second quarter guidance we know the first quarters or back half of it was hurting everybody and we started some softness but the fact they're willing to give guidance i know will fled was talk about that yerlier, but could be 20% growth clearly amazon was made for these time and that guidance
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proves that. their subscription service, their prime service, it was up 20% on a quarter that's not unusual but it sort of gives you a sense that you know this idea of buying into a regular subscription whether it's the media stock or delivery stuff is even more important now. so two really strong parts of the business clear will i. >> michael we kind of always wonder how much it's going to cost to deliver these products we're all spending more online do we think this increase in costs with a one off because of the special environment r or o is this a long-term impact to their profitability? >> i don't know really think it's, i don't think it's a long-term impact but the part i think people need to appreciate, yes, the operating income was weaker in the states one of the things i would highlight was aws margins were better that was an area of controversy. this hit everybody so fast, amazon i think reacted quickly, but did inefficient things in the short-term in terms of
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shipping costs, fulfillment, rushing to basically hire more folks, so i think people are going to want to understand more when they're talking about the oi guide for the second quarter with 4 billion of covid-19 related costs but my gut tells me that you're going to get out of thef this, this is going to be a much, much stlonger business. it's going to be better streamlineded, the margins ultimately go to a better place. >> one line that stood out to me that i've been hitting for a few time us was a quote from bezos saying to shareholders, take a seat because we are not thinking small. talking about how u a lot of those profits are going to go into protecting workers. based on your reporting and perception, how is amazon sort of risen to this occasion where there's so much demand for delivery of groceries and basics now? >> well it's not an overnight success. they've been investing in motes foa convenience mode, a delivery mode.
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a pricing mode an ability to know what people want mode. this is all stuff they've been investing in and he invests in things even if there are more costs now spending money for later is the smartest thing you can do. this stock is going. it could be one of the first trillion dollar companies. as scott galloway has talked about on pivot they're building for the future as they have been doing and they understand this is the tk anybo going to be able to catch them as i think about it going forward. it's really hard to imagine a competitor tho them in this spae and the people they've attracted to them now this this crisis this is a massive move for them. >> michael, how did the aws performance stack up compared to microsoft and google >> deaccelerated a little bit. maybe missed by about $120 million versus street but you know a 32%, 33%, i think pretty much noise and there were a a
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couple of quarters last year where it seems like a dollar growth so i think both i was much better margins but maybe people could pick a little bit on t running into earnings and you need to have a ten out of ten. i think on the operating margin side, it's completely understandable but as i menged before, it's a big number and i think people will want to better understand what the composition of that looks like >> ed, what are we learning about grocery? when they bought whole foods, it was sort of slow as a grower now, there's so much demand for online grocery and we know amazon's been planning on this, but they've had to limit new customers coming in. so is it prime for how much demand there is right now r for online grocery where does it stand? >> i think that's the right question i think online grocery delivery
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has been an achilles heel for amazon in terms of their same day or next day r or however many sort of, however they want to shorten that window now is the opportunity they were at least also trying to be kind of a delivery platform competing with ups and fedex a little bit they've sort of pulled back on that because of covid-19 they just need to put the resources elsewhere. but if and when, to listen for on the call, if and when they can figure out grocery delivery, which is a much harder nut to crack, i think they really win that game for everybody and that they then really become the same day platform for delivery. that's where you know, as big and as sort of unstoppable as they seem, that's the thing they still haven't figured out yet. >> in terms of the share price performance, it's going over what we've discussed already, but down 4, 5% is not much
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relative, not of course just to its year to date performance, but it's recent couple of year, it's had an amazing run. >> it sure has this is really just a little bit of a rounding error and i don't think it changes much in terms of the core thesis investors have been with this for the forever future for a long time. i think tactically what will happen perhaps at some point is it's now kind of a lead stock in the shutdown basket so to speak. so if we start to relax the restrictions and the economy seems like it's coming back and people are going to store, just from a sentiment perspective, the stock will probably give back some of this performance just because it's basically taking advantage of the disadvantages that others are at right now, but that's a more short-term concern >> kara, what about some of the criticisms about warehouse workers, the safety, the fact they need to make sure they provide everyone who delivers are masks and equipment and gloves
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they go to great lengths in this report to spell out everything they're doing. do you think this is going to have a bigger impact and attract more attention from say washington >> amazon has been attracting attention from washington for the past couple of weeks for a number of things again, this is an area they've never really been very good on is this treatment of workers and these essential workers are treated as sacrificial in some ways and so the question is can they make a convincing case they do care about their workers. bezos did visit one of the warehouses and i think it's probably top of mind from a pr point of view at the least, but it should be from a good corporacorp. citizen point of view. i think the question is who can catch them in this way and wla they can win and at the same time, protect their workers. i think that will be, that will be their biggest problem going forward after this where they get so much advantage from this crisis people signing up, people loving grocery delivery people are not going to go back
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to old retail the way they had it was already a trend that was happening. the question is is can they turn it arn and redeem themselves in the area of workers. it's a must do for amazon. >> the other stock of course are one of the other stocks that's benefitted a lot from the stay at home basket is netflix. do you think amazon investors give amazon enough credit for amazon prime video we've talked a lot about aws, online shopping. is that a big part of this story as well though >> yeah. i think the prime video stuff has always been a curious thing they've embarked upon. they're spending plenty of money on it. you mentioned netflix. between netflix and amazon, these are the kind of two coronavirus you know, made companies if you think about it in terms of their operating system and the way they, their whole value proposition is kind of designed for the current situation. not that they intended it that way, but it's fortuitously i think i'd like to know a bit
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more in terms of amazon kind of thinks about its services business, its media businesses do they need to spend more money creating stuff they just renewed a thursday night football deal with the nfl. they're not necessarily exclusive games. you can still turn on your broadcast station and watch them so what's their thinking there just a way to boost more prime subscribers or can they become the dingital distributor. so that's still something we need to figure out, but again, it's a bright spot for the company. >> amazon down 5.6% after hours. michael, karen, ed, stick around we are waiting apple results in a few minutes, but first, let's hit mgm resorts. contessa >> sara, a miss on revenue and earnings coming in slightly below expectations a rough quarter with casinos
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closed across the united states. a big hit to revenues because of coronavirus. but let's look at the balance sheet here 6 billion cash on hand at the end of the quarter the company just did another big bond race. now they stand at 7.2 billion. it's burning $270 million in cash every month but the company says look, the balance sheet remains sound. mgm resorts owns a significant stake in the gaming reit gaming properties it says it could sell that stake if it needs more access to capital and the earnings call starts in about 20 minutes with the new acting ceo at the helm i expect much of that call to focus on phase reopening where it happens, what factors are going into reducing that cash burn sara >> contessa brewer, thank you. stock down less than 3% here after hours. wilfred. >> just waiting for apple of course just 30 seconds or so away from
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when we expect that to drop. the stock pr apple is essentially flat year to date coming into this it was up 3% or so, 3.8% week to date, 2% to date coming in, so toughish set up like amazon's was where forecast 54.5 billion and 226 per share in terms of eps and we're waiting for those numbers of course due to hit any moment now within that 54.5 billion, the key numbers to look out for are iphone, services, but here are the numbers. josh lipton. >> wilf, apple reporting q2 eps of $2.55 that's first expectations of $2.26. revenue comes in at 58.3 billion versus expectations of 54.5 billion. gross margins 38.4%. im iphone revenue drops about 7% to 28.96 billion. the street has been looking closer to 30.89 billion.
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services jumping to 13.35 billion. the other category, ipad, 4.4 billion. mac, 5.345 billion wearables, 6.3 billion in the quarter. the company also does authorize an increase of $50 billion to its share repurchase program declares a cash dividend of 82 cents per share. it does not provide q3 guidance at this time did have a chance to catch up with tim cook to talk about this quarter. obviously we dove right into the iphone franchise and the supply side, i asked him are the iphone factories now back up and running. he said at full capacity, he said they would by mid march on o demand side, i was interested to hear more about iphone demand in china it's such an important market for apple and i asked him whether the lead indicator for other mashlrkets. he told me there was a
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significant steep fall off in february that began to recover some in march and we've seen further recovery in april so it leaves us room for optimism hard to tell if that's a leading indicator, saying there are differences. the u.s. has had a bold stimulus progrand that will help and i a optimistic about the pace of a recovery in the united states. also we talked about the work from home thing. obviously millions more people working, learning, playing from home i asked if that had caused a shift in demand for apple services cook saying it's clearly helping the ipad and mac and for that reason, we envision both of those to have improving year over year improvements if you look at tv plus, we've seen an uptick in the number of people viewing content as well as engagement with content and finally, he did not offer q3 guidance cook telling us we have great
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confidence in the long-term of our business in the short-term, it's hard to see out the windshield to know what the next 60 days look like so we're not giving guidance because of that lack of visib visibility and uncertainty it has nothing to do with our great confidence in the business it was a unique quarter, cook says never had anything liquite like this i hope to never have it again, but i'm incredibly proud of the company and what was achieved during this period of time back to you. >> thanks for that services, a slight beat off setting iphones a slight miss and the higher profitability of services allowing the eps line to be a decent little beat mike seeing the shares up 1.6% and i think that kind of speaks a bit to the way that today services are seen as a little more important to the investor as compared to iphones was a couple of years back >> certainly part of it. understo i don't think it's necessarily all that bullish that the ceo says one month into the quarter,
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not even going to give a guess as to what the business looks like for the other two third of this quarter but on the other hand, probably below what people are looking at the and a half of april awe some firming of activity and enables investors so say february into march was the trough of trends we're seeing in terms of demand and you can maybe hang something on that. >> still, it's hard to find a company that's buying back stock. that's one show of strength. and the china comments paint a pretty optimistic picture about what they're seeing in terms of growth you heard the optimism in tim cook's quote about recovery in united states because of the fiscal stimulus. what did you make of that? >> so i think the china comments
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are sbresing we heard from in this earnings season, other companies that have any kind of exposure or business in china including come cast from this morning where they talked about positivity and seeing the workers go back so china is a little fwlims of the future i think hopefully i don't know to what degree apple sees that as an important part of the business in term of moments like these where you're not going to rely on hardware sells and this reven revenue. i have yet to see a really coherent media strategy in terms of f are they a distributor, a content owner. seems like their real push is being a platform the way that amazon is a a platform with its video stuff. so more coherence, more sort of understanding the strategy is something i'd like to see more about. >> we're joined by dan and as
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we've mentioned, clearly no guide for the quarter going forward. i've scanned the press release and i don't thidon't think we hn announcement on when the 5g phone will be launched given that revenues missed in the quarter looking backwards, is it about a concern for you? >> i would characterize this as a small victory in the dark environment. i mean investors were expecting another one to 2 billion further miss on iphone and if you hook at the services businesses, a rock for apple combine that with china. i think not giving guidance is prudent. i think many not expecting that. but i call this better than fear with and services i think is the key focus points >> what about the boost to the
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dividend and buy back? >> i'd say here, many investors going into this were thinking they were going to pause the buyback just giving some of the political and pr pressures and i think that they're continuing that that's something that's going to be president obaositiv stock. that was the fear they'd have to put a pause and freeze that buyback. you combine this all in this dark environment investors are really expecting friday the 13th type of quarter and you didn't really get that you've got to o give them credit in what they're doing in an unprecedented environment. >> ross is joining us. what's your take on this clearly an outperformer coming into this and moving higher on the news? is. >> well, i think apple, dan is also right i think they did much better than i expected in china in q1 because boy, that could have been hard for them and actually their iphone numbers weren't as bad as i thought because honestly i thought who would buy
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an iphone in the u.s. right now. seems like the last thing you're worried about. to their credit, they had moved into services, but once again, i agree with dan i don't think their strategy was that effective and boy, if they would have had a great streaming service, apple could have gone to the next level now, but instead, it's acting a bit more like a really solid arch and tim is a great pilot of the barge. and he's done a great job navigating the waters, wu this is a slow growth value type stock that will own for a long time but you know, i just see the motivation there and i think it's great in this kind of market to own. but i think longer term, i still question where does apple go from here? >> well services is one place. you almost forget we're in the mid of a pandemic and one of the worst recessions our country has ever seen going through u these amazon and apple reports
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debating things like innovation. just how unusual are these two megacap technology stocks right now in terms of how they're doing and weathering this crisis >> well, amazon is so much more. i think ross is right. i just did an interview with alex and his book about these tech titans and he called apple a company refinement i think amazon hands down is the most innovative of these large companies and doing using things and he's 100% right about having really gone to the mat around streaming and other services they sort of dip their toe in. that said, not to go all larry david on you, but considering the situation said before, pretty good. you know not as bad as you were thinking you know what i mean it was fine. i think the issue is who comes out of this stronger i think probably if you had to bet, amazon is going to run away with everything. going forward.
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>> everything's turned negative. it's basically flat in after hour trading dan, i want to come back to the broad theme, we're in a massive recession. are people going to be buying iphones, particularly expensive 5g iphones as people's ability to consume big ticket items like that has been diminished >> it's a great question because right now, the average consumer is focused on health, jobs and groceries, not buying a $1,000 iphone tha going to be the challenge for apple going forward. you asked before in terms of the timing for 5g, you can't launch it into a sort of pandemic environment. do they push out the holiday season and what is the growth curve look like from a demand perspective. i think that's going to be the quagmire for apple as they launch the phone but importantly as karen ross talked about, a lot of this has been built into new estimates and expectations and i think
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that's going to be the focus for cook is especially about china china is right now the real focus point in terms of what we see from a rebound there >> ross, final word. >> yeah, i think that you know when compare amazon with apple, the perfect dichotomy of risk taking, making bold moves and i didn't like whole foods for a long time as part of o amazon and now i'm like dude, that totally paid off and that is the difference between bezos and what's p happening here with tim cook and apple that's why apple concerns me so it's still in our top three holdings and we're not changing that, but it's just hard to get exciteded about the company when amazon is doing so many amazing things >> ross, kara, dan, ed lee, thank you all for joining us
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>> great discussions there on both apple and amazon. we've got another one out. united phil lebeau has it >> for the first quarter, united report iing a smaller than expected loss of $2.57 a share revenue light of expectations coming in at $7.98 billion we've cesaid it before with a airlines, the first quarter doesn't really matterer. what matters is cash and liquidity. united ended the first quarter at 7.2 billion in cash they've had a couple of capital raises since then. as of yesterday, it was f up to $9.6 billion in cash in cash assets that it has at its disposal also the daily cash burn rate in march, it was $100 million day by the end of q2, united expect that is to be down to 40 to 45 million a day. the conference call is is tomorrow we'll get more color from the executives then. quickly want to shae you shares of boeing. david faber reporting that
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boeing has basically cured buyers for $25 billion worth of wonderfbonds of a variety of mas here the order book oversubscribed demand for up to $70 billion in bonds. not surprising given we've seen the credit markets improve guys, back to you. >> thank you mike, we go from amazon and apple back to reality with uniteded and updates on the cash and liquidity positions. what do you make of it >> right, so we go from what's anning going to do with all this abundance of surplus cash to companies that have to go and boll terror their ambulance sheets >> not surprised this deal got done every deal, every credit issue is oversubscribeded. people have to bid for more than they think they're going to get and they have to pay up for it a little bit not like it's necessarily all that expennive 5% it looks like across the curb but definitely r for its credit
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rating, they had to give a premium out there. but at least it buys them plenty of time. >> i have one final thought going back to the apple debate they've slightly increased the dividend but the yield doesn't change much. about 1% what if they put all of their buyback having clearly highlighted that it didn't work perfectly during the pullback and shares are packing it at all time highs what's the total cash back neeld yooeld and do investors at this requirement favor a dividend when so many others are being cut? >> i don't think any favor a dividend that's essentially funded by a payout of all the accumulateded cash if you're saying you're going to raise our payout, that's fine. so you have more than a 1% yield now but is it a $1.2 trillion company. if they were to sort of pay out 100 billion that they have sitting there in net cash. going to be a really rich looking yield.
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it's 8%. but that's not the way they get paid in interpreters of valuation. so i think they want to reward shareholders like warren buffett who doesn't sell any and every time apple buys back stock, he owns a greater proportion of the business and that's the thinking i think behind it. >> you know, mike, i was going say apple's trading lower and i wonder if there are going to be questions on the call, mike, about the fact that tim cook is telling josh he's very optimistic he told president trump he believes in a v shaped recovery yet the company isn't issuing guidance >> it's a question that will be legitimate but i think i don't think you can expect him to have clarity on what this world's going look like that nobody else has either so the valuation is perfectly full right now not like the stock's been penalized. just kind of a wait and see time
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for this stock and many others apple trading lower, about 1.7% in afterhours trade. still ahead, we'll ask the ceo of whirlpool to break down his latest results and ask whether there are plans for manufacturing facilities and how he'll ensure workers are safe. these days, it's anything but business as usual. that's why working together is more important than ever. at&t is committed to keeping you connected. so you can keep your patients cared for. your customers served. your students inspired. and your employees closer than ever. our network is resilient. our people are strong. our job is to keep your business connected . it's what we've always done. it's what we'll always do.
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millions of dollars to charities helping with covid-19 relief. keeping our promise to be on your side. whirlpool beating expectations but expects declines of 13 to 18%. joining us now is an exclusive interview, mark. thanks for joining us. >> thanks. >> what is business like right now? >> well you know obviously and let me first maybe talk about the human dimension of what we're all experiencing our job number one as a company has been and is and will remain to protect the health and safety of our employees and continue to serve our customers and help in our local communities. i'm are very proud about what our company has achieved here in the last couple of weeks now the economic phase of the
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coronavirus is of course a very ugly one having said that, and in particular taken into account during the month of marnl, we saw heavy impaglobally from coronavirus. we're pretty pleased of our results in q1. we kept operating margin despite these head winds which just shows how strong our business is and how resilient our underlying operations are. keep on going. >> i was going to say you've been able to give guidance as well which is down 13 to 18% for the full year. how have you managed to come to that estimate and what have you been able to learn from sales in regions like asia as to what might happen in the u.s. in the rest of the year >> first of all, we withdrew our guidance mid march and aren't establishing new guidance because there's so much uncertainty around this, it doesn't make sense to establish any meaningful guidance.
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however, investors have probably three questions. one, wh type of recovery do we expect two, how are we going to protect our margins and essential hi we more than doubled double our net cost program and three, how does our liquidity look like we finished with 2.8 billion cash and we have 1.2 billion of facilities and we have ample cash to sustain this crisis. >> it's hard to find a freezer that you can actually buy and get shipped to your house right now, mark. is it because there's so much demand as people stay home and they stock up on things like meat or is it because your supply is disrupted and you can't make that? >> first of all, i appreciate that you were checking on freezers, but having said that, what we saw and by the way, that's not only in the u.s., and we saw it in other markets and in the outset of the crisis and people do some hoarding, there is a lot of demand for really essential products
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freezers, washers, a second fridge, et cetera. that is not a typical, we've seen in the u.s. and we've seen in europe and we've seen that in china. as for the virus and as the crisis progresses, i would say you see a more of a normal mix now, specifically to your question about production, we actually did not completely shut down operations. very simply, consumers who are ordering products they do it for a reason and we won't let the customers down we kept our factories always in line with the guideline, but we kept it open for most of the time. >> across owl regions or was that in places particularly in mexico that were shutdowns >> of course, you have the on and off, but to give you perspective, over the last seven or eight weeks on average we had 75% to 80% of the factories open which is quite amazing given everything that's going on, and
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the mandated government shutdowns like this india, but we are 80 to 58% open and i also recognize that is very different from what you heard from the manufacturers, and it's for two reasons. one is we want to serve the customer the second thing is we essentially believe that what we call slow walking a factory. i.e., running at low speeds, low supply base and accepting a low yield if you want to say so is a safer way to establish a good supply base and a good supply chain. so we slow walked the factory and learned a lot over the last seven weeks. >> still, you have thousands and thousands of employees around the world, mark. what are your strategy sessions like right now with your top lieutenants about how you are going to safely reopen and protect your workers and when that's going to happen >> yeah. first of all, on a global level and we all know this crisis didn't come with a leadership
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manual, so you learn, but pretty much ever since late january we had weekly, daily calls and video chats and even in an odd way, that's never before and that's the nice thing if you want to say so of this crisis. in term was reopening and it gets back to the earlier point i made is we never shut down we kept most factories open even to give you an example italy, when you heard the nice, we only had the factories closed two weeks. we kept it running as you can imagine, you learn a lot how you keep on running and you make every day safer this virus is not invisible. it didn't come with a safety manual so listening to the medical advice and in dialogue, but with respect to the governments, every day we learn more and you will learn that the devil sits in the detail and today we're in a situation where we can say with a high degree of confidence our factories are as
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safe as they can possibly be >> mark bitser, we appreciate you talking to us ahead of that conference call tomorrow morning. >> let's get back to deidre bossa. more on amazon's numbers, d. >> i just got off the phone with brian olsovsky he said capacity constraints have been easing and i asked him if amazon was scaling back anything else given the enormous cost they are facing going into the next quarter he said most of the other businesses are less impacted on the capacity side and pointed to strengthen aws, a number of new prime video watchers he was also asked to give a number regarding the number of covid-19 cases at warehouses or among employees. he said that they declined to give any kind of number there and this could be important we have seen rising labor unrest.
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>> remember, they invested billions in, and they've reduced that this past quarter to essential goods even show more is coming back online and he is more optimistic and they'll be able to handle orders more quick le and we did see the one-day dlich are delivery percentage going off. employ, they provided some for the second quarter and are this is such a key part operating at an optimal level >> he sees a million in car taxes. back to you. >> deidre bossa. thank you very much. amazon down 5% the key things we are listening to on the conference calls on the other side of the break. when the world gets complicated,
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it's been a while in after hours session. here are the earnings movers apple beating on the top and bottom lines raising its share buyback program by $50 billion and lower by 1.5% suspending guidance amazon missed the revenue and was well ahead of the estimates. jeff bezos writing if you're a shareholders in amazon you may want to take a seat discussing spending in the upcoming profit on covid-related investments, also giving some strong double-digit sales growth. gilead and amgen both beating on the top and bottom lines and united airlines after a mixed quarter and a liquidity update they're 9.6 billion in total
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liquidity with an expected daily cash burn of 40 to $45 million mike santoli, take your pick as we go into the conference calls and what you'll be listening for. >> i mean, the mega-cap tech stocks don't owe anybody at this stage and you are seeing a sell the news response in apple and maybe it does come along with the overall market seeming that it's at a culmination point for this rally in the short term and it doesn't steeem to have chang the overall picture and we saw the average stock and the s&p exchange-traded funds, and it's all about figuring out that this is going to be a pause or something of a sharper pullback if we get that because by the way, the overnight action has not always been one direction. >> also, when we had all five stocks i could have suggested a return to the rotation of earlier in this week airlines bouncing, health care and tech, of course, declining and mike, on that point, broader markets had a soft day today,
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but unbelievably strong month. >> very strong month 12.5% and up 32% or so from the lows and also the theme of it doesn't really owe you anything, so i think it's kind of let's assess if that was too much, too soon or not. >> and we are out of time on "closing bell". >> and of course -- >> go for it sara. >> best month for stocks since 1987 though coming off the worst month in the '30s. >> melissa lee, over to you. >> i'm melissa lee, apple, amazon, visa, united all in the move in the after-hours session and many of the conference calls are just getting under way our traders tonight are standing by to break down the big headlines. with us for the hour, guy adami, tim seymour, dan nathan and karen finerman, but we begin with the biggest one, apple well off its after-hours highs and we have full-team coverage and deidre bossa is diggin

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