huskies. >> remind, me are they changing it next year? >> expand the playoffs to 12 teams, can't come too soon, i believe. >> after the season. >> thanks for watching power lunch. >> closing both the dow not only reversing its losses but up 150, points starts right now. kelly, thanks, what are the closing bell. i'm scott walker live from close nine at the new york stock exchange. this make or break our begins with the bounce. whether the major averages can resume their rally during this critical week. we'll ask our experts over this final stretch. in the meantime, there is your scorecard with 60 minutes to go in regulation. pretty nice move today in the mega caps and that is helping that nasdaq perform today. nvidia is leading, there makes a new a.i. related announcement. what does that mean? well, a more than 5% gain for that. coming, up we will ask tops chip checker stacy rasgon what it means going forward.

apple slipping two points this -- year but it's a big drag this hour after that incident over the weekend grounding 737 max jets. stop trying to recover a little, bit down 6%. speaking, of interest rates, there's the tenure. write a 4%. they're declining today following a positive report on inflation expectations and ahead of this week's cpi report. that takes us to our top of the tape, with the road ahead for your money might look like with learning season about to get underway and so much more ahead as well. let's ask aj owed, and jpmorgan private bank global investment strategist here post nine. good to have you back. interesting move we're seeing in the market after a pretty rocky road last week. what do you make of how this year started? >> i think the way this year started once we saw a lot of optimism priced in the last few months, november, december. and then when you add the fact that the fed sort of came up with their recipe, adding a little more rate, cuts what we've been seeing lately is the markets really trying to figure

out how many cuts were going to have this year. for us, we believe that more equities will see all-time highs at the end of 2024. the reason for that is we believe that technology will have a pretty strong year and that will sort of add to that tailwind that we are seeing inequities, into the end of the year. >> couple things there. number one, rate cuts, what do you think we're going to get the cuts? do you think will get as many as the market has seemingly priced into this point? is that the reason you think we're going to do high? just don't fight the fed? >> i think the market is pricing in a bit too much optimism, six rate cuts is what we're seeing priced in and the expectation is about 50% for a march cut. we believe it probably won't see it until june but we're not taking march completely off the table. we're looking at about 125 bass points of cuts. >> technology, that's the interesting conversation. do you think that is going to be the leadership group yet again? >> i don't necessarily think it's the leadership group but we think investors should continue to lean into technology stocks. especially driven by a.i.. i know everybody saw a lot of

that optimism last year. but if we think about, it if we go to the peak of technology in 2021 and we look at where tech stocks are today, the magnificent seven, they're only 7% above the peak that we saw before. if you think about that, 2021 had even priced in the a i move. if we think about a.i. and what we saw from the mid to late 90s and the contribution of private investment and intellectual property and how that contributed to steady growth and gdp, if we see that similarly in a.i., then we believe this is a multi year, not just a one year trend. >> you believe that the multiples that they're currently training for are justified? >> yes, i think so. i think there's an opportunity for continued growth of the comps compared to last you for earnings, we should see some positive earning results from those technology companies. we should see some top line revenue results as we believe that, essentially, a lot of that a.i. investment will turn to revenue generation soon. >> what about non-tech areas? what do you like the best? >> i think health care looks attractive just from a valuation perspective.

we like industrials because of the fact that, when you look at some of the thematic trends of ev transition, the infrastructure bill that will be needed, there we like mid cap growth as a way to position there. >> you are definitely in the know, recession soft landing camp? >> definitely in the soft landing camp. because of the fact that we've seen inflation come down meaningfully without too much pain at the labor, mark's seen the quits rate down to pre-pandemic, levels 2.3%. we've seen job openings fall from that peak back in 2022 down about 3.2 million. we've seen all of that happen and inflation come down. if we look back to the past six, months we're tracking around 3%. if you look at over the past three, months tracking close to 2%. the fed has some room to start cutting. it's deadly back in play here. >> what about the market multiple in general? we talked about what mega caps doing across the board but what about the overall market multiple? how do you justify that? >> it seems to some people a little frothy but it is trading right around what we see as our

p/e ratio for 2025. for looking 12 months forward, here it's not as discounted as you would like to see. that's why we really like mid cap stops because they are still priced in recession. you can get it from evaluations ten point but what we are telling clients is beat dead buyers, here if you see pullback, so that's an opportunity to lead in and beat those that way. >> you need growth to, holdup rates to go lower to continue to justify this multiple, don't you? >> growth is going to be somewhat muted this year. i think expectations for gdp is around 1.3%. we're seeing somewhat resilient growth. the i am surfaces didn't come in as high as everybody expected. >> still above 50. >> we're still an expansion airy territory, one point doesn't to note a trend. we're seeing somewhat resilient growth here in the u.s. and the fed is there to cut rates if necessary. >> what about fixed income? do you want people to continue to buy bonds? >> bonds are still showing attractive yields. you're not going to get --

we may not get that price appreciation that everyone was excited about last year. you've already got a lot of it. 100 based point move since that. the high we saw back in the fall. however, as we move away from that sort of positive correlation that we've seen an equities and fixed income, you have there for protection as well. 4% on a tenure and then you get it you're spread above that for corporates. that's an attractive yield. if you're rebuilding bond, portfolios absolutely you will want to lean into that. >> what is the big risk? the one thing that upsets your story? >> any geopolitical tensions that could add any re-inflation to the overall narrative and story. if oil prices pop up again like we saw on the fall or if we do end up in the sort of a recession. recession is still a risk that's at, there we don't think there is one. it will be anything deeper than that. if you get a disastrous event with a slowdown that is deeper than expected, that's how you could see a little more pain to markets. >> let's bring in cameron dawson of newedge wealth. nice to see you again. agree, disagree, what do you

think? >> ditto to what aj said on a lot of these points. the key risk to the market would be a re-acceleration of inflation. that is certainly not what is priced into the bond market at this time with six cuts forecast. if you look at the growth, picture it is holding up. there's probably even upside to that 1.3 gdp estimate. the question is, does that upside to gdp translate to better earnings growth? meaning, you already have 11% earnings growth baked in for this year and 2025. if you see better gdp growth, will that result in higher earnings estimates? that remains to be seen. >> do you think it might? >> it didn't in 2023, we saw a big upside to gdp and not to eps estimates. we think for this, year the estimate would have to come from the margin, line companies taking up more cost impossibly that productivity miracle, possibly from tech, possibly from a, i may be too soon to tell on that. we had also look to things like emanate coming back, capital rate employment coming back. people feeling better about the

outlook. maybe that's another source of potential upside to earnings estimates. but a lot is already forecasted. >> i'm trying to figure out with the number one risk would be if things seem kind of obvious to people at this point. growth is stronger than expected, you saw from inflation expectations today that they are down across the board. we expect the fed to, cut earnings to be pretty good. what is the risk? what is the one thing out there that would make you concerned about where the market might do this year? >> the snowball effect of the labor market. a little bit of easing, things around the corner, jolts and ease rates and of, cooling if it turns to outright weakness within the labor, mark it i don't think it being bad from payroll would be taken very well by the market -- >> i hear you on, that that makes perfect sense. but of course, then you're going to have people, say well, the fit is going to cut anyway. >> then you have to compare that where earnings estimates are. if you start have the market,

say no, it's a recession and earnings estimates need to be cut ten, 15%, the fed stepping in doesn't offset that. if there is no recession in the fed stepson to tweak policy rates, lower the market loves that. yearnings, growth evaluation. but all the sudden, if you start cutting earnings estimates, that's when the market get scared and you get people taking risk off. >> you think that earnings estimates not just in major cap but across the board are going to hold up? just 11%, is that realistic to you? >> historically, we see around 10%. earnings estimates aren't too far. i think our estimate for this year was about 2:41. a little bit below the, market which is about 2:48. we think they can and we actually think, even for q one, we should see closer to one and a half percent. the market is expecting about 1%. as we move throughout this, year it's going to be really kind of like playing a quarter by quarter. it's possible we see earnings estimates hold up. >> what do you want to do a small caps in your mind? >> small caps tend to

outperform in a recovery. i know we didn't have the recession, but at the end of the, day we are seeing slowing economic growth is going to have to be a rebound at some point. >> we had a lot of it already. almost 14% of just a few months. >> we, did but we still like both small cats and mid caps. large caps perform a very well last year. together, both of those sub has that classes can do well in 2024. >> what do i do with that? >> selectivity has to be the name of the game in small caps. small, caps there are so many unprofitable company, is highly leveraged companies. if you have interest rates or inflation move in the wrong direction, a lot of these moves will be reversed. however, there's a lot of names within the small cap index that are trading at big discounts, mid cap and large cap peers, where you can find opportunities. we focus on names that have strong free cash flow with good balance sheets as a way to discern between the junk and those that have better potential. >> what about areas that don't do anything last year that are starting to show some signs of life? it's been a lot of m n a in

health care already to start this year. it celebrates but that you think carries on? >> we like health care going to this year because you saw huge outflows from health care as a sector. it is under, loved under owned. also not very expensive. and on top of that the mrna you talked about. we prefer health care and biotech, stay way from where we see less strong trends. that selectivity plays and health care as well. >> what do you? think >> we like health care as well, for us, it's a devaluation play. it didn't get a lot of 11 2023. >> that's for sure. >> we think it's an opportunity to lead indefinitely in 2024. >> energy, how about that? i feel like people are trying to place their bets there but i think there is already skittishness. it's not going to work again. what do you think? >> i think you have to think of energy has a hedge instead of an outright upside opportunity. >> why is that? >> meaning, if you've higher inflation, a lot of parts of the market are probably going to struggle with higher interest rates. meaning, if you see oil prices

go, up that contributes to higher inflation, energy will be your safe haven. see it is a position size more like a hedge, instead of an outright bet on upside. >> you like energy or not? >> with, energy when you are seeing a slowing economy like we are, demand is coming down. ultimately, energy going through a lot of pain. i would say we prefer real assets in general as a way to tactically hedge against any inflation or exposure there. but energy as a sector, not really loving it right now. >> you paint the case so that you are in the firm, hey, the economy is going to be good camp. >> it's going to be good, we believe, in 2025. this is the slowing. your ruling at 1.3% gdp. that is below trend growth right there. as demand is slowing down and we're seeing a slowing economy, energy isn't going to be that sector that has strong performance. >> do you feel like maybe today is the first kind of inkling of it? mega caps talks come down but people get a little scared. you had to, believe at some point, there's going to be a by

that dips. nvidia made some announcements today that we're going to get in to later with the top in the list talks at 5%. apple had a terrible start to the year. do you feel like that is the floor though underneath mega caps? but the buyers is going to come in and every bit of an settlement there? >> effectively, what you're saying is that the trend is your friend and you have enough trend in these tech and broader mega cap names. you haven't seen a breakdown in the absolute relative trends. apple, you mentioned, probably the weakest of all the mega caps charts. i think you have to watch that closely because, unlike nvidia, where a lot of the upside was because earnings estimates went up so much, apple was all multiple expansion. it was up 45% in his people the, bull earnings estimate state about flat. that's where you want to probably discern between different mega caps and maybe that's where you'll start to see kind of some just persian between the results. >> you think that's going to be the case this year? i feel like it's like today is a perfect example. people, say well, this could be

more dispersion, maybe apple doesn't trade with the, groove everything kind of traded together even though there was stark out performances from some of the names. one up, all up. right? >> that's positioning, right? if you floated, equities these mega caps really do benefit. at the same time, you've kind of the own what you know dynamic with apple and people always want to have a piece of it in their portfolios. i, understand i think it's a really good question. if you start to see those breakdown, can the overall cap weighted index continue to do well? that remains a big question for 24. >> you, guys i think, a reasonably optimistic about earnings and where they're going to begin. they begin with the financials. you like the group, finally? financials? >> yeah. >> jp morgan notwithstanding, don't have people tying on that one. alicia of a nice performance with the stop of the last year. >> financials tended to perform well also based on where the yield curve is positioned right now. still very much flat. we start to see some normalization, we could begin to lead in their.

but until we actually begin to get rate cuts on the, table i think that headwind on the regionals is still existing. that is one question that all investors are going to be looking at. head of those reasonable banks share in these queue for results that will be coming out soon. that something will be looking at. but financials right, now it's on something we're ready to step partisan. >> the performance of, late obviously they've done well of late. it's here for the banks? >> you have to be very selective as well. some banks have better balance sheets than others. >> what about large banks? let's just say to ages, point if the yield curve reese deepens, wang and goes up, reeves deepening of the curve, better for net income? economy hangs in? >> add on top of that return of investment banking revenue. practically dead for years. if that, happens as long as criticality holds, in using credit delinquencies pick up for consumers. it's an issue for those that have bigger consumer business? if it is, that's probably what will discern the winners and

losers. >> we are going to make that the last word, appreciate it very much. aj, good to see you again. cameron, we'll see you soon. camera dotson. shares of boeing are under pressure. you know by, now that incident on an alaska air lines flight to zinc dozens of 737 max is to be grounded. our phil about has been following the story from the outset. what do we know now, phil? scott, we're still trying to figure out exactly what the ntsb has learned so far in its investigation. what, surprisingly they're not giving a whole lot of details. we get an update from them tonight. it's good news, here especially if you're a boeing shareholder, it's the fact that the protocol for inspections for the grounded 737 max dash nine, that has been approved by the faa. what does that mean, it means the grounded max-9 will spend four hours each night expecting the aircraft. that's the expectation. if everything is, clear everything checks, out they do everything is they are mandated to do through the inspection

protocol, then theoretically these planes could resume flying. some of them may be back in the air tomorrow or on thursday. relatively quickly. i'm sure the airlines want to get these back in service. again, that's an important move here that the inspection protocol has been approved by the faa. take a look at united, you see the showers moving higher. especially after the approval came out. you see 79th max, planes they canceled 232 flights today. not all were max 9 relayed it but it's a ripple effect of having all of these cancellations because of groundings. then when you of alaska, 65 max nine planes. they canceled 137, flights much like united. not all of them were max night there's a ripple effect there. in terms of the actual investigation by the ntsb, as i mentioned, it will be updating reporters tonight. 10:00 eastern time. and what they have learned so far. they do now have the fuselage plug which was ripped off of the plane. they found it in suburban portland. they're looking at that.

there obviously, as you can see, here looking at the plane. they have the flight data reporter in washington now. you're looking at shares of boeing, the interesting thing will, be just a one-off incident, scott? tomorrow, boeing will be holding a town hall at the rental plant where they build the max. ceo dave calhoun will be there. even if it is a one, of this is a good opportunity. he doesn't want to waste a crisis. we can say to the rank-and-file, we've got to do a better job when it comes to keeping our eye on the ball. does it mean that boeing is responsible for this. but he understands that people are looking at the max and saying, here we go again. scott, back to you. >> we're talking about airlines, delta obviously starts reporting their earnings later this week. what kind of story are the airlines going to tell, phil? >> it will be a strong one for the fourth quarter. look, you had a clean holiday for thanksgiving and explain holiday for christmas and strong demand. the numbers are going to be pretty good for the airlines. now, the question becomes, how

do you take that and leveraging it into 2024? we know the first quarter is slow, it's always slow, but the, airlines will find it from ed bastian when we talk to him on friday. they are noticing that certain parts of the market obviously remain strong. international. what are they noticing in terms of business? continues that business traveler continues to come back, little by little. they'll be a focus of our conversation with him on friday. >> stocks on the move as well today. phil, appreciate, it fill about. just getting started here on closing bell. up next, nvidia moving higher today thanks to a big announcement at the consumer electronics show. we've got the details coming up. also going to talk to star chip in a list stacey ragson about how he thinks these developments could affect the nvidia share. we're live from the new york stock exchange, you're watching closing bell on cnbc. a force to be reckon with. no, not you saquon. hm? you! your business bank account with quickbooks money, now earns 5% apy.

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to kristina partsinevelos as we watch the stocks -- >> twilio, as jefferson steps and a ceo. this comes as activist investors and lead investors pressured the company to sell it suffered our best one of its businesses. twilio does say it expects this fourth quarter revenue to exceed its prior guidance. shares are up almost 6%. crowdstrike is higher after being named a top pick by rbc. analysts say cybersecurity spending continues to be a top priority for companies, which allow crowdstrike to continue gaining customers and marketer. that's what you're seeing shares of five and a half percent. last but not least, nvidia it's on the move higher after announcing three new desktop graphics chips with add-ons

that not only allow gamers but also computer users in general to make better use of a.i. on their personal computers without having to rely on the cloud and services over the internet. it is the apc everyone keeps talking about. nvidia isn't, alone amd and intel are pushing the new a.i. pc with hopes it will revitalize a pc markets. and for the up over five and a half percent. >> perfect setup. kristina, thank. you will see you soon, kristina partsinevelos. for more on today's and i surge and this news, let's bring in bernstein senior analyst stacy ragson. good to see you back. watch it will stop it run the market, five, percent is that on this a.i. at home, if you want to call, it news? >> to be, fair it was up before they made it. was having a lousy day after -- i don't know if it's entirely because of the announcement, but the announcement certainly isn't hurting. >> what do you make of the

announcement? how significant is it? what should we think of this a ipc? >> look, because of nvidia actual numbers, probably this doesn't matter very much. more abundant data center business which is getting 80% of revenues anyways. the idea that a.i. in general is proliferating is a good thing. some of these announcements, they announced the new gaming parts and health care partnership announcements and some other things. these are all good in terms of just driving home the idea that a.i. is starting to proliferate. specifically around a ipcc, we've been hearing a lot of those from intel and amd. it's kind of nice, finally the king of a.i. is talking about a.i. pcs. that is something that we haven't actually had really until today. the fact that they can actually be pushing that a little, bit i think it's maybe a good thing from that standpoint. >> are we at the point now where we are beyond the rising tide lifts all boats thing? last, year s in each had the best year in 20. so many things went, up we

don't even know which ones that went up a really capable of monetizing a.i. over the long run. do we get more dispersion this year? >> yeah, you mean for the sector. semis had a strong year last year, semiconductors in 2023, the stock was up. pretty amazing. this is honoring the. down in terms of, revenues we've had fairly significant cuts in terms of writing everything else. the easy money has probably been made. 2024 will probably be an interesting year. broadly, it should be a growth year after some fairly nasty results in 2023 around memory and some other things. not all and markets though. it's been an asynchronous cycle at different and markets were different points. things like pcs and smartphones, i think they are through their inventory cycle. they should have a decent year after a horrendous 2023. i think things like a i clearly

are off the charts strong right now. they will be. traditional data center, networking, service cpus, they've been weak. probably still weak. i think things like auto and industrial actually have just started to roll. industrial actually is rolling over hard. auto, we've been seeing some cracks until last, week we had mobile line, which had a pretty nasty negative on inventory. audit will be something to watch this year as well. some of the analog names might be a little more challenge because of those industrial and auto trends. >> i had been at the, forgot because every time we, talk i feel like it's invidious world and we're just living in it. i didn't realize a broadcom as your top overall pick. why is that? >> i like broadcom, it has a number of things going for. it for those unfamiliar, it's not a semiconductor business but it's not for. business software business as much, bigger -- 40% of the revenue now. for their semiconductor business, in a world where people are worried about

numbers, they de-risk to the semiconductor segment. they're guiding their non a.i. pieces anywhere from high single digits all the way to high teens depending on the segment. david today i, story second best a.i. story in the space, i think, after nvidia. they're involved in making custom compute off-load a six with hyperscale doing their own a.i. chips as well as networking. that's very strong. actually bridging the gap from the shortfalls of some of their other businesses, which are cyclical shortfalls. in the meantime, they did just by vm where -- you're going to run into a 2025 broad column, by the time all the synergies are, in they'll be doing close to 60 bucks a share and eps on i-70, is popping up on 80% gross margin and 30 billion dollars in free cash flow. and it's cheap. multiple expansion but still very very cheap relative to the space of relative to the quality of the business. i really like broadcom. >> amd has had a really good

run of late. dr. lisa sue has really been out, they're making the case for that company. hey, we're here to and we're going to be real players. we suggest that the stock might be over its skis, you do have a perform rating on it. why is that? >> it's funny, i don't know if i should say this on tv, i don't know if you should listen to me for amd, i'm a capable of calling that stop properly. we downgraded early last year and it was on a thesis that gross margins were too high and numbers are too high. that was absolutely true, that happened and nobody cared. they did something really, really smart. the a.i. story from nvidia actually, when they had the sort of printed heard round the world in the last year. amd latched onto that, and to their credit, they had a roadmap with products on it. there's some demand because people are looking for a second source. and they left themselves some room for that narrative to run, they said they will, do quite a, more than two billion dollars

in a.i. revenues, and i 300 is the product, more than two billion dollars in revenue this. year left alone, that could be three, four, five. it is a rounding error relative to the size of the business. for, empty that could be good enough. it's very possible that as long as that a.i. narrative can hold, people may continue to overlook some of the shortfalls of the rest of the business, which have clearly been there, i worry they're still there as we go into next year. but the a.i. story for, them they don't need to do 60 billion dollars or 80 billion dollars or whatever it is that nvidia is going to do, right? if they do four or three, that maybe enough and that may keep the stop going from them. >> it's kind of my point that i mentioned earlier. you talk about a.i. a lot and then bang, you get the a.i. bump but the rubber has to meet the road at some point. i guess we'll see, i guess we'll see. i believe it, there stacey. >> i still wary numbers could be a little high, but like i said, that narrative could

carry and it has been carrying them for the last several, quarters even as numbers have improved. >> i appreciate your honesty on your md calls. we'll talk soon. >> all right. >> that is stacy ragson joining us on closing bell. of, next the deal making frenzy and health, care not just today but to start this year. we're going to bring you up to date on all of the stocks being impacted and what it could mean for not only mna going forward before that sector and your money. closing bell is coming right back. ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term

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closing bell, several health care deals getting announced today. leslie picker here with all of those deals for us. hi, leslie. >> hi, scott. this is what one might call a healthy amount of deal activity. this morning alone, we saw an announcement from boston scientific to acquire axonics for 3.7 billion. that expensive position did you hear it battle function to --

j&j by amber x and merck buying harpoon for six 80 million. journal reporting recently that novartis is planning a takeover of cytokinetic, switch has a promising heart drug and a ten billion dollar market evaluation. this flurry of deal making, not a coincidence. it comes amid the jpmorgan health care conference taking place in san francisco. the reportedly 8000 people attending this year's event is an annual occurrence or health care companies can talk up the recent deals and discuss future ones. the conference comes on the heels of an active december, where just three pharma giants, abbvie, bristol-myers squibb and astrazeneca scooped up nearly 30 billion dollars worth of drugmakers. the prospect of more deal making as well as those declining interest rates set the spider s&p biotech etf surging about 25%. since the start of december. lots of, high lots of excitement surrounding this

space, scott. >> are we going to be talking, leslie, about other sectors that health care when it comes to a deal and a pick up? it's just the beginning, do you think? >> it's interesting. because one of the key drivers of mna is very health care specific, that a lot of these companies are facing patent cliffs. whereby some of their key drugs, the patents are expiring and they're able to -- other companies are able to create generic versions of those. that is kind of driving the mna here, as well as of course those declining interest rates that we saw at the end of the year. when you think about the ipo pipeline, when you think about the mna timeline and how that interplay is with, we can start to see some more activity if rates to stabilize. but there's still some concern surrounding regulation, private equity says there's still some disconnect between what the buyer is willing to pay and what the seller is willing to sell out in terms of valuation. a lot of the hurdles we saw last year are still in play.

that said, activist activities of the event people are pointing to as a key driver of potential m in a in 2024. >> appreciate that, leslie. thank you. we'll see you in the market zone with another report as you follow the money. up, next five star stop, picks capital wealth planning is kevin simpson's back to break down the latest trades. how he is also playing earnings season as it gets ready to get underway. closing bell, back in just two minutes.

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starts rebounding today after week start to the year. that's ahead of earnings from the big banks later in the week. let's bring in capital wealth planning's kevin simpson. good to see, welcome back. >> hey, scott. >> you're always active and here you are. i see you sold jpmorgan. we're talking about earning starting the end of the, week this one included. it was a big winner. why did you sell it? >> you know, we trim this position, scott. we love jpmorgan, it's been a top bank position for a long time. over the past few, months the stock is up 25%. that gives us an opportunity to sow into street. we have it as a full position, but when you've done something that makes that kind of move, especially a company that isn't an a.i. related stock, you want to take advantage of that. great to size your positions. we still think it's going to do very well. they beat earnings 82% of the

time. might be a little late year over year but they're talking about 10% growth. we also sold covered call on it heading into earnings. you get a little bit of volatility increases when earnings seasons start. it's a another treat technique readable take advantage of. >> are you bullish more or less the financials in general or not? >> yeah. i'm bullish on the market. i think, if we look at this year from a longer term perspective and we think about where we started the year and where we end the year, were positive on how that shakes out. whether that affects rates in march, that might be premature. whether there is as much as americans hoping, for six or seven, cuts i'm not sure. if that's a case either. but from a broader perspective, we think stocks are going to be higher. we want to sell into some strength modestly and definitely want to be buyers on pull backs. >> you think earnings are going to be good? >> yeah. i think they are going to, because we're looking at a low bar. we always talk about earnings season as this majestic --

we always tend to set the bar just to the point where we can look smart and get ovethat's no. >> home depot. you added to it. >> same thing in terms of our thought process on home depot. we think lower aides are going to do good things for the consumer. we think it will do good things for home depot, larger purchases, home renovations, this is a stock that is done well in the period of this rate spike. looking at this position and right sizing, if there is a little bit of a pullback last week. we added, it we rounded out to a 5% position. when i like most of it at home depot this time of year is that they traditionally give you a dividend boost in january. for the past five, years that dividend increase, scott, as average about 16% annualized. looking at a hedge against inflation, strong dividend growth is the lifeblood of our portfolio. we are expecting home depot to raise their dividend again when they announce quarterly

earnings in q one here. >> that you are preferred housing related play? >> it, is 100%. in the retail, space we also own walmart. we've always been fans of home depot. for the past, decade we favored it over lows. >> guy. you see you soon. thanks, kevin simpson. that, next shares are surging in today session and more when closing bell comes right back. when you think of investment risk, do you consider climate risk? changing weather patterns are impacting the way we live and the value of businesses large and small. this can mean disruption to supply chains, changing demand for products and shifting regulation.

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leslie picker, back with data on how hedge funds fared last year and what may lie ahead this. but mike santoli, you first, pretty good bounce to start the week. >> yeah, one week, a little bit of a reset, i wouldn't say that you can declare it over, but it showed you that last week you had that sort of pent-up selling, that carried into the new year. which you knew was going to collide with peoples interest in getting involved into a new year. i know the discussion is will we get new highs? we are 1% away from a new closing high. it's nothing from here to get there. i do think it was nice and broad throughout the day, so the combination, i, think i'm just bad things continuing not to happen, the inflation expectations going down, bottled's staying tame. the corporate commentary, the focus you are able to have on the consumer stocks, on the health care names, as things kind of ramp towards earnings season, i think it was enough for now, again, i don't think you completely skimmed away the optimism that you came in, a

little bit over allocated in the start of the year. so far so good in terms of that dip fires feeling after this year. >> this inflation expectations thing, if nothing else, helped yields to study for a while. >> it seemed like. it i've been sort of not dismissive of the expectations piece, but basically that's just not the game. the game is the numbers. and we know i gasoline prices are doing. it's very linked with that. but all of the leading indicators, and what the actual inflation data are going to do are also friendly. which i think is why the focus is a little more on downside risk to growth. you're not really seeing a reason to get to panic about it. there was an uptick in corporate involving credit. consumer evolving credit in november. it's all this stuff is still good enough, i think, to accommodate this idea that you are not too far off the soft landing pad. >> you mentioned what's going on in retail. courtney reagan, why don't you tell us more. i see a number names getting a nice bump today. >> absolutely, a lot of these have to do with retailers presenting at the ice your

conference in orlando. let's go through some of them. crops, biggest mover up 20%. better than expected fourth quarter revenue, company executives also called 2023 a year with sheer gains, also successful holiday season. but barn, up 7%, city calls its quarterly pronouncement better than feared. it's icrp than patient showing comps improved in december from november. promotions also remaining in check. american eagle, raising its fourth quarter guidance on record holiday sales. also raising revenue and operating income guidance. those shares up 6%. five below, reaffirming quarterly earnings and revenue guidance. but failing to top expectations for those. shares down about 4%. just go, that's the company that owns journeys, a couple under international retailers. it cut its four-year guidance saying holiday sales decelerated after a strong start to the season. shares there are down. they were down 2%, they have paired some of those losses down just about 1% now. scott? >> courtney, appreciate it, by the way, we have the ceos of

abercrombie and five below. they sat down with morgan brennan today in overtime. still want to catch those. mike, just a comment from you, nike sort of got people a little bit concerned about the consumer. but maybe that was a little more nuanced, and today is more evidence of that when you hear from some of these others. >> yeah, a little more specific, maybe the nike, but also the setup for nike was a little bit unfriendly. lulu tried to track down the prospects, nobody believed them. i think it's still steady as she goes. not really eye catching growth numbers on the top line across the board. but there's enough strength there. jp morgan, again, pointing to this sort of reservoir of excess savings, it's still not down to zero. so if on friday, you wanted to be worried about 4.2% annual wage growth, because it was made inflation, there's obviously a really good element of that in terms of spending power. >> some good new data on what hedge funds are doing, at least what they did last year, and how things are setting up for 2024. leslie picker? >> yes, we do, scott.

for your hedge fund numbers are in. according to these new numbers, just published by data collector h f r, the fund rate weighted composite index gained 7.5% in 2023. now, while not all funds are equity focused and therefore compared to the s&p, the broader index, of course, was up about 24% last year. the big move inequities though served as a tailwind to the activist tragedies, which added to their november games in december, making them the best performers at the end of the year. among the loggers included macro, particularly funds that are uncorrelated with the market, uncorrelated macro funds were effectively flat in december, as commodities and interest rates declined. still a different president says the outlook for 2024 has, quote, improved with higher nominal levels of bond yields, continuation of powerful a.i. driven technology trends, expanding cryptocurrency,

liquidity, and strength in m&t. scott? >> leslie picker, i appreciate that very much. the dow is at, we are basically at session high across the board. frankly, the dow with a whole lot better if it wasn't for boeing today, which is a huge drag. we do have even more developments now on those inspections of the 30 -- 7:37 max nine airplanes. philip, what can you tell us from some headphones that we see dragging chancellor? >> yeah, scott, take a look at shares of boeing. the reason they're being dragged lower is this is a report that first came out 15 minutes ago from the air current. matched by our literally joseph set cnbc.com. essentially comes down to this. united airlines has found a loose balls on door plugs of several boeing 737 max nine planes during inspections. remember, some of these planes were initially expected by united as well as alaska on saturday, after there was the incident with the alaska airlines plane on friday night.

that was before the faa said no, we're going to ground all of these until we have protocol here. this reporting from cnbc's dot comes leslie joseph, as well as the air current, john ostroh, are essentially says, look, some of these points that were checked out have loose balls. in the door plug on the 737 max nine. if that's the case, scott, it raises the question, which is the primary drag on boeing, which is the quality control in the lack of, them or appearance of the lack of them. at the right, in washington factory. that's the latest, scott, we reached out to both united as well as faa as well as boeing, we'll let you know if they are any comments at all. scott? >> do you know, phil, forgive me for putting on the spot if you don't, but just for people you've been talking, to assume these balls have been found in their loose, are we talking about something as simple as just tightening the bolts to get the planes back in the air? or is it something more significant? >> hard to say, scott. i don't know exactly.

look, i don't imagine that this is likable that you and i see around our house and we tighten it up, and that's the end of it. it's far more intricate than that. having said that, scott, loose bolts is just a terminology that i can imagine people who are bowing shareholders are looking at this going, if this is true, if this is part of the problem here, what's going on? this sort of comes down to craftsmanship 101. why would this problem be cropping up now, on the 737 max nines? >> yeah, that's a fair point. i appreciate you answering that. it's gonna be interesting what shares do from here. jim lebenthal, for example, has been's big a boeing share supporter as long as i can remember. dumped those shares today, said enough is enough. just tired of watching that story unfold. phil, thank you, let us know if you get anything else between now and the end of this day. that's fill about. mike, we're going to go out

here. >> we, are we're going to have another little update when you saw the general market clause close older. that show the first emergency to get money into this market before gets away from you. we'll see if that's enough. 2% from the two your high, it's forcing a buy. >> boeing would be up like 4:50. a pretty strong day across the board. closing bell: overtime with morgan and john. >> well, your school car has a lot of green. mother's day certainly a winner stay for a lot of the market. all the major averages higher. even the dow being dragged down by boeing, welcome to closing bell: overtime, i am jon fortt, morgan brennan is that the ico are conference in orlando. coming up she's going to be discussing the outlook for consumer spending with the ceos of abercrombie & fitch, and five below. boeing had been a highir